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Mexico certification stirs debate
Hotel & Motel Management / April 7, 1997

By Larry Luxner

WASHINGTON -- For the second year in a row, the Clinton administration has "decertified" Colombia's drug-fighting efforts while "certifying" those of Mexico -- in an annual ritual that has infuriated Latin American leaders and sparked accusations of U.S. hypocrisy.

"The government of Colombia has failed to follow through on promised counter-narcotics action or to confront fully the drug interests that contributed millions of dollars to President Ernesto Samper's campaign," said Assistant Secretary of State Robert S. Gelbard in justifying the decertification. "There is as much cocaine coming into the United States or being produced in Colombia as ever before, more heroin being produced in Colombia than ever before. That's the bottom line."

Nevertheless, the Feb. 28 decision against Colombia -- in which the South American nation was lumped together with such pariah states as Afghanistan, Iran and Libya -- is unlikely to have any real impact on the country's booming hotel industry.

"Nothing grave happened to the hotel sector last year," said Jorge Valencia Caro, an advisor to the Bogota Hotel Association. "Things are still normal. Demand dropped in the tourist zones of Cartagena and San Andres, but we can't say for sure whether it was because of decertification."

In fact, says Caro, demand for hotel rooms in Bogota jumped 11.4% last year while the supply of five-star hotel rooms surged by 34% with respect to 1995 figures. As a result, the average occupancy rate dropped. At the moment, the average corporate tariff for a five-star hotel is $112, while the rack rate is $230.

The United States has long been Colombia's most important trading partner -- and the source of much of its foreign tourism. Yet when a country is decertified by the U.S. government, it can lose everything from preferential treatment for its exports to landing rights for its U.S.-bound aircraft.

Arguing against the decertification, a delegation visiting Washington in mid-February argued that "sanctions that injure legitimate busienss would be counterproductive for the solution of the current crisis. Such a development would be a serious blow to democratic institutions and undermine Colombia's drive against drug trafficking."

Despite the decertification and the threat of possible economic sanctions that comes with it, Colombia's hotel boom -- fed by a healthy economy and billions of dollars in laundered drug money -- continues with no end in sight. Over the last few months, several large hotel chains have announced plans to build luxury properties throughout the nation.

In January, for instance, the 251-room, 14-story Radisson Royal Bogota opened for business in the Teleport Business Park of Bogota's upscale Hacienda Santa Barbara district. The five-star property -- a joint venture between Radisson Hotels International and Colombia's Royal chain -- represents a $29 million investment, according to Emile Chehab, Radisson Latin America's vice-president for development.

Another five-star property, the $40 million Inter-Continental Cartagena, opened last October in Colombia's premier resort destination. The 255-room property has two towers -- one 13 stories high and the other 21; Inter-Continental also has luxury hotels in Bogota, Medellin, Cali and Rionegro.

Finally, as part of efforts to grab a bigger slice of the Caribbean cruise-ship market, the port of Cartagena plans to build a duty-free shopping center as well as a new passenger terminal. Construction on the shopping center -- designed by Miami-based architects Bermello Ajamil & Partners -- should begin early this year and finish by late 1998. Project manager Alfredo Sanchez says the center will accommodate 40 stores selling eveything from leather, jewelry and tobacco to liquor, perfumes and handicrafts.

The retail center is part of a four-part master plan that also includes dredging the port to receive large cruise ships, as well as the development of a home-port cruise-ship terminal. Cartagena now gets 100,000 passengers a year, though this is projected to jump to 234,000 by 2000 and 548,000 by 2015.

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