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STATUS
REPORT ON COUNTRIES - 2005
CHANGE IN ADDRESSES:
PLEASE TAKE NOTE ON THE DETAILS OF OUR ADDRESSES ON THE
ENCLOSED BROCHURE. OUR OFFICES IN COSTA RICA CHANGED LOCATION, WE HAVE A NEW
OFFICE IN BOGOTA; AND WE STILL NOTICE THAT MANY UNDERWRITERS ARE STILL
MENTIONING OUR FORMER ADDRESSES IN LATIN AMERICA. WE APPRECIATE IF YOU CHECK
INTO YOUR RECORDS AND MAKE THE NECESSARY ADJUSTMENTS, NOTIFYING YOUR STAFF
AND REGIONAL OFFICES.
MOLLER GROUP SERVICES:
IN THE ENCLOSED BROCHURE YOU CAN FIND A LIST OF OUR
OFFICES IN LATIN AMERICA AND THE SERVICE WE RENDER. WE ALSO OFFER OUR
SERVICES FOR MAJOR CASES IN THE CARIBBEAN ISLANDS AND NEIGHBOUR COUNTRIES.
SINCE THE FREE TRADE AGREEMENT BETWEEN ALL THE CENTRAL
AMERICAN COUNTRIES AND THE USA IS EXPECTED TO BE IMPLEMENTED IN THE NEAR
FUTURE AND WILL AFFECT THE UNDERWRITING BUSINESS IN THAT AREA, WE ARE PROUD
TO ANOUNCE THAT WE ARE IN THE PROCESS OF OPENING AN OFFICE IN MEXICO THIS
YEAR AND ARE ALSO LOOKING FOR OPTIONS IN PANAMA. WITH THIS PROJECT WE WILL
BE ABLE TO PROVIDE OUR SERVICE IN ALL THE COUNTRIES THAT ARE SUBSCRIBING
THIS FREE TRADE AGREEMENT.
TO OBTAIN AN UPDATE OF THIS DEVELOPMENT, OUR SERVICES,
OUR GROUP OFFICES, ETC. WE INVITE YOU TO VISIT OUR WEB PAGE:
WWW.MOLLERGROUP.NET
IF THERE IS ANY FURTHER INFORMATION YOU MAY NEED, JUST
CONTACT OUR HEAD OFFICE IN CARACAS.
STATUS REPORT:
AS GENERAL INFORMATION FOR OUR CLIENTS WE ARE ISSUING A
GENERAL REPORT OF THE GENERAL SITUATION OF EACH COUNTRY WHERE WE ARE
LOCATED, WITH THE MAIN POINTS OF INTEREST FOR THE UNDERWRITING MARKETS.
VENEZUELA :
PORTS:
MAIN PORTS ARE PUERTO CABELLO, LA GUAIRA, MARACAIBO, EL GUAMACHE AND GUANTA
IN THE CARIBBEAN COAST, AND PTO. ORDAZ, AT THE ORINOCO RIVER. PUERTO CABELLO,
HANDLES APROX. 60% OF THE CARGO FOR THE WHOLE COUNTRY, GUANTA AND MARACAIBO
ARE MOSTLY USED FOR THE OIL INDUSTRY AND PUERTO ORDAZ ON THE ORINOCO RIVER
WHICH IS MAINLY USED FOR THE IRON AND ALUMINUM INDUSTRIES.
PORTS ARE CONTROLLED BY THE REGIONAL GOVERNMENTS. HANDLING OF THE CARGO AND
STORAGE IS DONE BY PRIVATE COMPANIES. PIER INFRASTRUCTURE NEEDS RENOVATION
IN ALMOST ALL THE PORTS
THERE ARE WEIGHT FACILITIES AT LA GUAIRA AND PTO. CABELLO IF REQUIRED.
WEIGHT STATED ON RECEIPTS AND DELIVERY DOCUMENTS IS USUALLY TAKEN FROM THE
BILL OF LADING. CLEARANCE OF CARGO IS SOMETIMES SLOW DUE TO GOVERNMENT
BUREAUCRACY. NATIONALIZATION IS TAKING APPROXIMATELY 5 DAYS.
AIRPORTS:
INTERNATIONAL SHIPMENTS MAINLY ARRIVE THROUGH THE
MAIQUETIA AIRPORT (CARACAS) , VALENCIA IS ALSO INCREASING CARGO DELIVERY.
MARACAIBO AND PORLAMAR AIRPORTS ARE NOW HANDLING SOME INTERNATIONAL FLIGHTS
AND CARGO SHIPMENTS. IN SOME CASES CARGO IS TAKEN BY LOCAL FLIGHTS IN
CONNECTION WITH INTERNATIONAL AIRLINES. IF ANY ABNORMALITY IS OBSERVED,
CARGO WILL BE WEIGHED AT THE AIRPORT SINCE MOST OF THEM HAVE WEIGHT
FACILITIES.
AIRPORTS ARE CONTROLLED BY THE REGIONAL GOVERNMENT, CARGO
IS KEPT IN PRIVATE WAREHOUSES.
RISKS:
ALTHOUGH IMPROVED IN THE LAST YEARS, ROUGH HANDLING ON
DISCHARGE AND PILFERAGE BEFORE LEAVING PORT OR AIRPORT IS STILL THE MAIN
RISK FOR THE CARGO. CERTAIN TYPES OF SHIPMENTS SUCH AS HOUSEHOLD
ELECTRONICS, COMPUTER, AUTO SPARE PARTS, HARDWARE AND PERSONAL EFFECTS ARE
AT HIGHER RISK OF PILFERAGE. WATER PENETRATION IN DETERIORATED CONTAINERS IS
A COMMON CLAIM DURING THE RAINY SEASON BETWEEN (APRIL - NOVEMBER) SINCE
CONTAINERS ARE USUALLY STORED IN OPEN AREAS.
STRANDING OF VESSELS IN THE ORINOCO RIVER OFTEN HAPPENS
DURING THE DRY SEASON (DECEMBER TO MAY) DUE TO LOW RIVER LEVEL. DREDGING OF
THE RIVER HAS BEEN NEGLECTED RECENTLY LIMITING THE VESSELS DRAFT, TOWAGE
SERVICE IN THE RIVER HAS ALSO IMPROVED.
RECOVERIES:
RECOVERIES AGAINST INTERNATIONAL AIR OR OCEAN CARRIERS
ARE POSSIBLE DUE TO THE STIPULATIONS STATED ON THE AWB OR BL, ANYHOW SINCE
THE LEGAL PROCEDURE IN VENEZUELA IS DIFFICULT WE RECOMMEND THAT RECOVERIES
SHOULD BE INTRODUCED ABROAD. RECOVERIES AGAINST WAREHOUSES AND GROUND
TRANSPORT COMPANIES ARE VERY DIFFICULT BUT IMPROVING ALTHOUGH STILL LENGTHY
AND EXPENSIVE. WAREHOUSES AND SOMETIMES BIG GROUND TRANSPORT COMPANIES HAVE
A LIMITED LIABILITY INSURANCE ISSUED IN LOCAL CURRENCY.
GROUND TRANSPORT:
THERE ARE HIGHWAY FACILITIES FROM THE MAIN PORTS AND
AIRPORTS. THE HIGHWAY BETWEEN THE PORT/AIRPORT CLOSE TO CARACAS IS IN RISK
OF COLLAPSING DUE TO LANDSLIDES THAT ARE AFFECTING ONE BRIDGE. ROADS ARE
PAVED EXCEPT IN VERY REMOTE AREAS. THE MAJORITY OF CLAIMS ON GROUND
TRANSPORT ARE DUE TO ARMED HIJACK OF THE TRUCKS ON THE MAIN ROADS OF THE
COUNTRY. THIS TYPE OF CLAIM HAS BEEN INCREASING ALARMINGLY. COMPLETE
CONTAINERS ARE TAKEN AND THE AUTHORITIES ARE OVERWHELMED WITH WORK, THEY ARE
UNABLE TO FURTHER INVESTIGATE SUCH ASSAULTS AND RECOVERY CHANCES ARE NIL
SINCE THE ASSAULTS CANNOT BE ATTRIBUTED TO NEGLIGENCE ON BEHALF OF THE
GROUND TRANSPORT UNLESS PROVEN OTHERWISE.
INSURANCE:
INVESTMENT OF INTERNATIONAL UNDERWRITERS IS PERMITTED
SINCE 1994, OVER 50% OF THE LOCAL UNDERWRITING MARKET IS NOW OWNED BY
FOREIGN COMPANIES. REINSURANCE IS MAINLY PLACED ABROAD AND REINSURERS OFTEN
ESTABLISH THE COVERAGE CONDITIONS AND THE NOMINATION OF THE CLAIM AGENT.
GENERAL SITUATION OF THE COUNTRY:
THERE IS FOREIGN EXCHANGE CONTROL SINCE JANUARY 2003;
ACCESS TO FOREIGN CURRENCY IS CONTROLLED. NEVERTHELESS DUE TO THE HIGH OIL
PRICES IMPORTS ON 2004 RECEIVED US$ 17.000 MILLION AND 20.000 MILLION IS
EXPECTED FOR 2005. UNEMPLOYMENT RATE IS AROUND 15%. ALLTHOUGH OIL PRICES ARE
HIGH THE UNSTABLE POLITICAL SITUATION OF VENEZUELA PLACES THE COUNTRY ON
HIGH RISK OF CIVIL CONMOTION AND UNCERTAINITY IN THE FUTURE. THE
GOVERNMENT’S CLOSE RELATIONS WITH CUBA ALSO CREATES UNCERTANITY AMONG THE
POPULATION AND PRIVATE INVESTORS.
COLOMBIA:
PORTS:
PORTS ARE CONTROLLED BY PRIVATE REGIONAL COMPANIES.
HANDLING OF THE CARGO AND STORAGE IS DONE BY DIFFERENT PRIVATE COMPANIES.
MAIN PORTS IN COLOMBIA ARE: BUENAVENTURA ON THE PACIFIC COAST HANDLES APROX.
40% OF THE CARGO AND CARTAGENA,SANTA MARTA AND BARRANQUILLA ON THE ATLANTIC
COAST HANDLE APROX. 20% EACH. BARRANQUILLA AND CARTAGENA ARE ALSO PORTS ON
THE MAGDALENA RIVER. CLEARANCE OF CARGO TAKES AN AVERAGE OF 4 DAYS AFTER
VESSELS ARRIVAL. THE PORT OF BARRANQUILLA HAS ONGOING PROBLEMS WITH THE
DRAFT OF THE ENTRANCE OF THE RIVER.
AIRPORTS:
SOME AIRPORTS ARE STILL CONTROLLED BY THE DEPARTMENT OF
CIVIL AVIATION, PRIVATIZATION OF ALL AIRPORTS IS PLANNED FOR THE FUTURE,
THOSE PRIVATE AIRPORT HAVE HAD CONSIDERABLE IMPROVEMENTS IN THEIR
INFRASTRUCTURE. BOGOTA IS HANDLING APROX. 55% OF ALL IMPORTS, MEDELLIN AND
CALI APROX. 25% EACH, AND BARRANQUILLA THE REMAINING 10%.
RISKS:
ROUGH HANDLING OF CARGO, PILFERAGE AT PORT OR AIRPORT
WAREHOUSES. STRANDING OF VESSELS IS VERY RARE. PENETRATION OF WATER DURING
THE RAINY SEASON IS COMMON SINCE OFTEN DETERIORATED CONTAINERS AND MANY
ITEMS ARE STORED IN OPEN PLACES.
RECOVERIES:
ALTHOUGH PROTECTED BY LAW, RECOVERIES ARE VERY SLOW AND
EXPENSIVE; WE RECOMMEND THAT RECOVERIES SHOULD BE INTRODUCED ABROAD WHENEVER
POSSIBLE. RECOVERY SPECIALIZED LAWYERS CHARGE THEIR FEES IN US$ CURRENCY.
GROUND TRANSPORT:
OF 114.000 KM OF ROAD, 38% ARE IN A MEDIUM FAIR CONDITION
(ONLY 25% IS PAVED), 43% IS IN BAD CONDITION AND 16% IS ALMOST UNUSABLE.
ROADS CAN BE VERY STEEP AND CURVY MAKING THE TRANSPORT OF HEAVY EQUIPMENT
DIFFICULT. PILFERAGE OFTEN OCCURS WHERE TRANSPORT IS SLOWED DUE TO THE
CONDITION OF THE ROAD. COMMON THEFTS OF TRUCKS AND CARGO IS ALSO A RISK.
INSURANCE:
FOREIGN INSURANCE ON IMPORTS IS ALLOWED. REINSURANCE
SOMETIMES INFLUENCES THE COVERAGE CONDITION AND THE NOMINATION OF THE CLAIM
AGENT. FOREIGN INVESTMENT IN THE LOCAL INSURANCE MARKET ALLOWED AND
INCREASING.
GENERAL SITUATION OF THE COUNTRY:
COLOMBIA IS RECOVERING FROM SEVERAL YEARS OF RECESSION
THE GUERRILLA CONFLICT AND OTHER SIMILAR SITUATIONS ARE STILL AFFECTING THE
ECONOMIC AND POLITICAL SITUATION OF THE COUNTRY, BUT DIMINISHING VERY QUICK
UNDER THE ACTUAL PRESIDENT’ GOVERNMENT. THIS SITUATION ALSO AFFECTS THE
MANPOWER. INFLATION IN 2004 DIMINISHED TO 6% AND IS EXPECTED TO BE LOWER IN
2005. IMPORTS IN 2004 WERE OF APROX. 15.600.000.000 US$ EXPORTS OF APROX.
US$ 16.400.000.000 . FOREIGN INVESTMENT IN ENERGY, WATER AND TELEPHONE
SERVICE HAVE INCREASED CONSIDERABLY IN THE LAST YEARS; NEVERTHELESS THIS
TREND DEPENDS OF THE GENERAL POLITIC SITUATION.
HONDURAS:
PORTS:
PORTS AND CUSTOM WAREHOUSES ARE GOVERNMENT OWNED. CARGO
HANDLING AND STORAGE IS PERFORMED BY PRIVATE COMPANIES. CUSTOM INSPECTION
CAN BE DONE EITHER AT THE CUSTOMS WAREHOUSE OR AT THE CONSIGNEES PREMISES AS
LONG AS IMPORT TAXES ARE PAID IN ADVANCE. INSPECTIONS AT CUSTOMS ARE DONE
VIA LOTTERY; THEREFORE NOT ALL GOODS ARE INSPECTED.
MAIN PORTS IN THE ATLANTIC COAST ARE: PUERTO CORTES
(CONSIDERED AS THE BEST EQUIPPED PORT IN CENTRAL AMERICA), LA CEIBA AND
TRUJILLO, AND HENECAN ON THE PACIFIC COAST. THE LATTER DOES NOT HANDLE
CONTAINER CARGO. PUERTO CORTES WAS CERTIFIED TO TIGHTEN SECURITY AGAINST
TRANSPORT OF DANGEROUS GOODS AND OR THREATS TO UNITED STATES PORTS. THIS
CERTIFICATION WAS OBTAINED IN 2005. RECENTLY, A CONTRACT WAS NEGOTIATED TO
HAVE ALL INCOMING AND OUTGOING CONTAINERS SCANNED BY GAMMA RAYS, ALTHOUGH
THE PROCESS HAS BEEN QUESTIONED DUE TO THE EXCESSIVE COSTS ON EACH
CONTAINER, $35 TO $75 EACH.
AIRPORTS:
THERE ARE FOUR INTERNATIONAL AIRPORTS IN HONDURAS:
TEGUCIGALPA, SAN PEDRO SULA, LA CEIBA AND ROATAN. SAN PEDRO SULA AND
TEGUCIGALPA HANDLE INTERNATIONAL CARGO. THESE TWO AIRPORTS ARE UNDER
CONCESSION TO A PRIVATE US COMPANY. CUSTOM WAREHOUSES HAVE BEEN RECENTLY
TRANSFERRED TO PRIVATE COMPANIES.
RISKS:
PILFERAGE AND ROUGH HANDLING IS THE MAIN RISK FOR ANY
CARGO. CUSTOM PROCEDURES HAVE IMPROVED AND ARE MORE STREAMLINED SO IT CAN
TAKE A FEW DAYS FOR A CONTAINER TO CLEAR ALL THE PAPER WORK.
DURING THE RAINY SEASON WATER PENETRATION IS ALSO A RISK,
MANY ITEMS ARE STORED IN OPEN PLACES AND RECENTLY WE’VE SEEN CLAIMS
INVOLVING CONTAINERS WITH HOLES ON THE ROOF AND / OR SIDES.
DRAWBACK INDUSTRIES ARE ONE OF THE MAIN FOREIGN
INVESTMENTS IN HONDURAS, SINCE THEY OPERATE UNDER SPECIAL CONDITIONS AND ARE
TAX FREE, THERE IS NO LEGAL CONTROL ON THEIR BOOKKEEPING, IT IS VERY HARD
FOR SURVEYORS TO ESTABLISH INVENTORIES BASED BY BOOKS, LACK OF ENGLISH OR
SPANISH LANGUAGE BY THE OWNERS AND DISTRUST TO SHOW ANY RECORDS ARE ALSO A
DIFFICULTY TO ESTABLISH CLAIM AMOUNTS.
RECOVERIES:
RECOVERY ACTION IN HONDURAS IS ALMOST IMPOSSIBLE;
GOVERNMENT INSTITUTIONS, WAREHOUSE OPERATORS AND GROUND CARRIERS WHERE MOST
OF THE CLAIMS MIGHT OCCUR DO NOT ISSUE CERTIFICATIONS, LESS FEEL LIABLE FOR
ANY CLAIM ARISEN UNDER THEIR CUSTODY.
GROUND TRANSPORT:
ALL THE PORTS ARE ACCESSIBLE ON HIGHWAYS AND PAVED ROADS.
RAILWAYS ARE PRACTICALLY NON-EXISTENT. CLAIMS FOR GROUND TRANSPORT ARE
MAINLY FOR PILFERAGE. LOCAL TRANSPORT COMPANIES DO NOT CARRY INSURANCE.
NUMBERS OF ASSAULTS BY GANGS IN WHICH DRIVERS AND CUSTODIANS IF ANY, HAVE
BEEN HURT AND ABANDONED, ARE ON THE RISE.
COMMERCE WITH NEIGHBBORING COUNTRIES AND THE CREATION OF
A TRUCK CANAL TO PUERTO CORTES BRING A VAST NUMBER OF CONTAINERS FROM EL
SALVADOR, COSTA RICA AND NICARAGUA, WHICH CRISS-CROSS THE MAIN HIGHWAYS. A
NEW HIGHWAY FROM OMOA IN THE NORTHERN PART OF THE COUNTRY IS BEING
CONSTRUCTED TO JOIN WITH NEIGHBORING GUATEMALA.
INSURANCE:
THERE ARE NINE LOCAL INSURANCE COMPANIES, SOME WITH
ALLIANCES WITH OTHER CENTRAL AMERICAN INSURERS. REINSURANCE IS PLACED
ABROAD. TRANSPORT POLICIES ARE NOT WIDELY OFFERED BY LOCAL COMPANIES, IT IS
USUAL TO IMPORT AND EXPORT WITH FOREIGN COVERAGE.
GENERAL SITUATION OF THE COUNTRY:
DESPITE THE DAMAGES THAT HURRICANE MITCH WROUGHT IN
OCTOBER OF 1998, VIRTUALLY STOPPING GROWTH FOR TWO CONSECUTIVE YEARS,
HONDURAS IS SLOWLY RECUPERATING. FOREIGN DIRECT INVESTMENT FROM NEIGHBORING
COUNTRIES HAS GROWN AND VARIOUS SECTORS LIKE TOURISM AND COMMERCE HAVE
BENEFITED FROM IT. THE COUNTRY HAS FINISHED DICUSSIONS OF THE FREE TRADE
AGREMENT WITH THE U.S. THE GOVERNMENT HAS ALSO SIGNED AGREEMENTS WITH
INTERNATIONAL CREDITOR AGENCIES AND INSTITUTED TAX REFORM PACKAGES TO
ALLEVIATE THE PERSISTENT BUDGET DEFICIT. ALSO, MANY POLITICAL REFORMS ARE
BEING INTRODUCED TO STRENGTHEN DEMOCRACY AND ULTIMATELY, DEVELOPMENT.
STAGFLATION AND UNEMPLOYMENT HOWEVER, CONTINUE AS SOCIAL PROBLEMS FOR MOST
OF THE POPULATION.
COSTA RICA:
PORTS:
THE MAIN PORTS IN COSTA RICA ARE:
LIMON AND MOIN ON THE ATLANTIC COAST AND CALDERA, PUNTA MORALES AND GOLFITO
ON THE PACIFIC COAST. LIMON HANDLES 70% OF THE CARGO AND CALDERA IS USED FOR
BULK SHIPMENTS, PUNTA MORALES IS ONLY USED FOR BULK SUGAR AND GOLFITO FOR
BANANA SHIPMENTS. PORTS OPERATIONS ARE CONTROLLED AND HANDLED BY GOVERNMENT
INSTITUTIONS.
CARGO HANDLING AND STORAGE IN
CUSTOMS WAREHOUSE ARE DONE BY PRIVATE COMPANIES. CUSTOM INSPECTION CAN BE
DONE EITHER AT THE CUSTOMS WAREHOUSE OR AT THE CONSIGNEES PREMISES AS LONG
AS IMPORT TAXES ARE PAID IN ADVANCE.
AT PORTS THERE IS NOT POSSIBILITY TO
OBTAIN WEIGHT TALLYS. CUSTOMS DOCUMENTATION SHOW GENERAL REMARKS REGARDING
LOSSES OR THE CONDITION OF THE CARGO.
AIRPORTS:
“JUAN SANTAMARIA” IN SAN JOSE IS THE
INTERNATIONAL AIRPORT FOR CARGO, AND “DANIEL ODUBER” IN GUANACASTE WHICH IS
USED FOR TOURIST CHARTER FLIGHTS ONLY.
AIR CARGO MOVES APROX. 5% OF THE
IMPORTS AND EXPORTS OF THE COUNTRY.
AIRPORT OPERATIONS AND STORAGE IS
CONTROLLED BY PRIVATE COMPANIES.
RISKS:
ROUGH HANDLING AND PILFERAGE IS THE
MAIN RISK FOR THE CARGO, WATER PENETRATION DURING THE RAINY SEASON IS A
NORMAL RISK.
CUSTOM PROCEDURE TENDS TO BE SLOW;
IT SOMETIMES TAKES A FULL MONTH FOR A CONTAINER TO CLEAR ALL THE PAPER
WORK. CUSTOM AUTHORITIES ARE THE ONES WHO ISSUE CERTIFICATION FOR LOSS OR
DAMAGES.
RECOVERIES:
RECOVERY ACTION IN COSTA RICA IS
ALMOST IMPOSSIBLE, VERY SLOW AND EXPENSIVE. WE SUGGEST THE INTRODUCTION OF
RECOVERY ACTION ABROAD WHENEVER POSSIBLE.
GROUND TRANSPORT:
THE ATLANTIC AND PACIFIC COAST ARE
CONNECTED WITH A HIGHWAY. THE MAIN ROADS ARE PAVED BUT SOMETIMES VERY STEEP
AND CURVY, WHICH CAUSES MANY ROAD ACCIDENTS. RAILWAYS HAVE DETERIORATED AND
GROUND TRANSPORT IS MOSTLY DONE WITH TRUCKS. TRUCK COMPANIES IN GENERAL DO
NOT HAVE LIABILITY INSURANCE AND RECOVERY AGAINST THEM IS VERY HARD IF NOT
IMPOSSIBLE. ASSAULTS ON TRUCKS SELDOM OCCUR.
INSURANCE:
FOREIGN TRANSPORT INSURANCE IS
PERMITTED. THE STATE HAS THE MONOPOLY OF THE INSURANCE. THERE IS ONLY ONE
INSURANCE COMPANY, NAMED INSTITUTO NACIONAL DE SEGUROS CONTROLLED BY THE
GOVERNMENT.THERE IS HIGH INTEREST TO OPEN UP THE MARKET, BUT POLITICAL
INTERESTS ARE DELAYING THIS PROCEDURE. REINSURANCE IS MOSTLY PLACED ABROAD.
ON BIG ACCOUNTS THE REINSURANCE HAS THE POWER TO DETERMINE THE COVERAGE
CONDITIONS AND CLAIM HANDLING.
GENERAL SITUATION OF THE COUNTRY:
COSTA RICA CAN BE CONSIDERED AS THE
MOST STABLE DEMOCRACY IN LATIN AMERICA. TRADITIONAL EXPORTS CONSIST OF
BANANAS AND ITS WORLD FAMOUS COFFEE. IN THE LAST DECADES IT HAS EARNED
INTERNATIONAL RECOGNITION FOR NON-TRADITIONAL EXPORTS SUCH AS : TEXTILES,
PINEAPPLES, FLOWERS, PLANTS, VEGETABLES. FOREIGN INDUSTRIES AS INTEL AND
ABBOT LABORTORIES HAVE INCREASED THE COUNTRY EXPORT SINCE THEY OPERATE UNDER
SPECIAL TAX CONDITIONS.
TOURISM IS THE PRINCIPAL FOREIGN
INCOME IN THE AREA OF SERVICE AND IS CONSTANTLY INCREASING.
INFLATION FOR 2004 WAS CLOSE TO 13%
AND IS EXPECTED TO MAINTAIN THE SAME TREND THIS YEAR. THERE IS NO CURRENCY
CONTROL BUT THE GOVERNMENT SUPERVISES DE RATE OF EXCHANGE.
COSTA RICA HAS FREE TRADE AGREEMENTS
WITH CARIBBEAN BASIN INITIATIVE (CBI), MEXICO, CHILE, CANADA AND TRINIDAD
AND TOBAGO.
ON JANUARY 2004 COSTA RICA CONCLUDED
THE NEGOTIATION FOR THE FREE TRADE AGREEMENT BETWEEN U.S.A. AND CENTRAL
AMERICA. IT IS EXPECTED THAT THE APPROVAL IN THE COUNTRIES CONGRESSES WILL
BE COMPLETED THIS YEAR 2005.
FOR COSTA RICA THIS AGREEMENT
ELIMINATES THE INSURANCE MONOPOLY OF THE STATE, SO FROM JANUARY 2008 IT WILL
ALLOW PRIVATE INSURANCE COMPANIES TO SELL COVERAGE FOR TRANSPORT, PROPERTY,
LIFE, AND FROM JANUARY 2011 ALL TYPE OF INSURANCE.
GUATEMALA:
PORTS:
MAIN PORTS ARE: SANTO TOMAS DE CASTILLA AND PUERTO
BARRIOS ON THE ATLANTIC OCEAN AND QUETZAL, SAN JOSE ON THE PACIFIC OCEAN.
QUETZAL IS CONSIDERED AS THE MOST MODERN ONE AND OPERATES 24 HOURS, SANTO
TOMAS DE CASTILLA ALSO HANDLES ALL TYPE OF CARGO. PORTS AND STORAGE ARE
CONTROLLED BY GOVERNMENT INSTITUTIONS, PORT OPERATIONS ARE GRANTED TO
PRIVATE COMPANIES.
CUSTOM CLEARANCE OFTEN TAKES PLACE IN GUATEMALA CITY,
AFTER SHIPMENTS ARE BROUGHT EITHER BY TRUCK OR TRAIN FROM THE PORTS. THIS
OLD PROCEDURE IS OFTEN REASON TO ISSUE THE BILL OF LADING MENTIONING
GUATEMALA CITY AS FINAL DESTINATION POINT AND MAKING THE OCEAN CARRIERS
LIABLE FOR THE GROUND TRANSPORT.
AIRPORTS:
GUATEMALA HAS TWO INTERNATIONAL AIRPORTS, “LA AURORA”
LOCATED IN GUATEMALA CITY WHICH IS ALSO USED FOR AIR CARGO AND “SANTA ELENA”
IN PETEN WHICH IS USED FOR TOURIST TRANSPORTATION.
CARGO HANDLING AND CUSTODY AT THE AIRPORT “LA AURORA” IS
BEING DONE BY PRIVATE COMPANIES. GUATEMALA HAS THE TENDENCY TO PRIVATIZE THE
HANDLING AND STORAGE OF CARGO IN ALL PORTS AND AIRPORTS.
RISKS:
ROUGH HANDLING AND PILFERAGE IS THE MAIN RISK FOR THE
CARGO, WATER PENETRATION DURING THE RAINY SEASON IS ALSO COMMON. ASSAULTS ON
TRUCKS HAVE ALSO BECOME A TREND IN GUATEMALA. CERTIFICATIONS FOR LOSS OR
DAMAGE ARE ISSUED BY CUSTOM AUTHORITIES, MAKING IT SOMETIMES DIFFICULT TO
ESTABLISH THE LIABLE PARTY ON A CLAIM.
DRAWBACK INDUSTRIES ARE ON HIGH RISE IN GUATEMALA. SINCE
THEY OPERATE UNDER SPECIAL CONDITIONS AND ARE TAX FREE. THERE IS NO LEGAL
CONTROL ON THEIR BOOKKEEPING. IT IS VERY HARD FOR SURVEYORS TO ESTABLISH
INVENTORIES BASED BY BOOKS. LACK OF ENGLISH OR SPANISH LANGUAGE BY THE
OWNER, AND DISTRUST TO SHOW ANY RECORDS ARE ALSO A DIFFICULTY TO ESTABLISH
CLAIM AMOUNTS.
RECOVERIES:
RECOVERY ACTION IN GUATEMALA IS ALMOST IMPOSSIBLE, A VERY
SLOW PROCEDURE AND TOO EXPENSIVE. TRUCK COMPANIES USUALLY DO NOT HAVE
LIABILITY INSURANCE, TRAINS ARE CONTROLLED BY THE GOVERNMENT WHERE RECOVERY
IS IMPOSSIBLE. WE SUGGEST WHENEVER POSSIBLE TO INTRODUCE RECOVERY ABROAD.
GROUND TRANSPORT:
OF THE 14,283 KM .OF ROAD NETWORK, 6.000 KM ARE PAVED.
THE PRINCIPAL HIGHWAYS ARE THOSE OF THE CENTRAL AMERICAN NETWORK, SUCH AS
THE PANAMERICAN HIGHWAY, THE ATLANTIC PACIFIC INTER-OCEAN HIGHWAY, AND THE
SOUTH COAST HIGHWAY. ROADS AND HIGHWAY CONDITIONS HAVE IMPROVED CONSIDERABLY
IN THE LAST YEARS. THERE IS A 782 KM. RAILWAY IN A VERY DETERIORATED
CONDITION, THE SAME WAS GIVEN IN CONCESSION TO AN AMERICAN COMPANY,
IMPROVEMENTS ARE EXPECTED IN THE NEAR FUTURE..
INSURANCE:
FOREIGN TRANSPORT INSURANCE IS ALLOWED AND MOSTLY USED BY
IMPORTERS AND EXPORTERS. INSURANCE MARKET IS OPEN TO FOREIGN INVESTMENT,
SOME WELL KNOWN INSURANCE COMPANIES ARE ESTABLISHED IN GUATEMALA.
GENERAL SITUATION OF THE COUNTRY:
Guatemala is at a moment of
transition due to the new government that just took on January 2004. THE
CONGRESS ALREADY APPROVED THE TLC WITH THE USA. THIS AGREEMENT has generated
expectations AMONG INVESTORS. ALTHOUGH THE PAST GOVERNMENTS confrontation
brought up more unemployment, insecurity, social confrontations AND created
an environment of distrust and uncertainty for possible investors, change is
expected in these aspects due that Guatemalans and the international sectors
are confident that all this process could revert and international analysts
believe Guatemala has the resources to settle its problems.
FOR 2005 gross internal product IS
EXPECTED TO increase 3% while on 2004 it increaseD 2.6%. For the first
months of the year 2005 economical analysts forecast that inflation will
reach 7. The prime export products are: SUGAR, COFFEE, bananas, cardamom and
petroleum. |
