This record is a partial extract of the original cable. The full text of the original cable is not available.

S E C R E T SECTION 01 OF 02 PANAMA 001695 
 
SIPDIS 
 
NOFORN 
 
DEPARTMENT FOR WHA/CEN, EAP/CM AND EAP/TW 
SOUTHCOM ALSO FOR POLAD 
 
E.O. 12958: DECL: 08/09/2015 
TAGS: PREL PGOV PINR PM TW POL CHIEF
SUBJECT: (C) PANAMA: DIALOGUE WITH TAIWAN ON PRC ACTIVITIES 
 
REF: A. STATE 143649 
 
     ¶B. PANAMA 0909 
 
Classified By: CHARGE DE AFFAIRES LUIS ARREAGA FOR REASONS 1.4 (B) AND 
(D). 
 
Nature of U.S. Contacts with Local Taiwans 
------------------------------------------ 
¶1.  (C/NF) Embassy maintains excellent informal relations 
with Taiwan diplomats in Panama and frequently engages in 
productive dialogue with them.  For instance, PolOffs have 
met with former Taiwan ambassador David Hu and current Taiwan 
ambassador Tomas Hu several times.  (See Reftel B.)  PolOffs 
also often have met with Taiwan DCM and military attache MG 
Antonio Yang, Counselor Jaime Chen, first secretary Cristobal 
Taur, and second secretary Trinidad Chen.  DAO enjoys 
excellent access to MG Yang through the military attache 
association. 
 
Quality of the Dialogue 
----------------------- 
¶2.  (C/NF) The quality and reliability of the information 
gleaned from our meetings with the Taiwans has been 
excellent.  For example, Taiwan Ambassador Tomas Hu predicted 
April 19 that the outcome of the April 28 Oval Office meeting 
between President Bush and Panamanian President Torrijos 
would determine whether Panama would change its diplomatic 
relations in favor of China or maintain the status quo with 
Taiwan for the remainder of Torrijos's five-year term that 
began September 1, 2004.  Hu's source was "a high Panamanian 
official," higher than the vice minister level.  The timing 
of the purported change in relations was unclear, but 
probably following a Canal referendum in 2006.  Supposedly 
Torrijos would raise the topic on April 28 and evaluate what 
he heard from President Bush.  Taiwan worried that a switch 
in Panama's relations to the PRC could well affect Taiwan's 
relations with the entire Central American and Caribbean 
region. (POL Counselor reported the conversation by email to 
WHA and EAP.) 
 
Taiwans Were Correct 
-------------------- 
¶3.  (C/NF) Amb. Hu's prediction was largely correct. 
According to POL Counselor's sources within the GOP, Torrijos 
concluded from his Oval Office China/Taiwan discussion that 
the USG would not object to Panamanian recognition of China 
and that recognition of China has been in President 
Torrijos's mind as an active possibility since that time. 
(Comment: POL Counselor's sources disagreed with Hu about 
Panama's timing of a switch in diplomatic recognition from 
Taiwan to China (PRC).  If it should happen, Panama would 
wait until after passage of the US-Panama FTA, so as not to 
complicate matters with Congress, perhaps by the end of 2005, 
they maintained.  The sources also confirmed that Torrijos 
claimed to have found "independent" funding to complete the 
Colon-Panama highway, which Embassy concludes to mean that 
China has offered to pay for the highway.  Other sources have 
suggested that China may agree to buy Panama's banana crop. 
Panama's banana industry and its 20,000-30,000 banana workers 
have been in a state of depression since the multinational 
firm Chiquita left Panama several years ago.  End comment.) 
 
¶4.  (S/NF) In another example, at a June 21 meeting with POL 
Counselor, Taiwan Counselor said that a high GOP official had 
told his Embassy that Panama and China are engaged in active 
negotiations on China recognition with Panama's commercial 
office chief in Beijing.  Embassy has corroborated that 
report independently. 
 
Value of Seeking Enhanced Dialogue 
---------------------------------- 
¶5.  (C/NF) Embassy expects to use our existing good relations 
with Taiwan diplomats as Department suggests, concentrating 
on core mutual interests, and averting sending unintended 
signals to the Taiwans, as Department already has noted, that 
our diplomacy will "tilt" toward Taiwan in the future at the 
expense of China.  On the other hand, every Embassy 
interaction with the Taiwans sensitizes us to their agenda 
and their vested interest in spreading alarm about the PRC. 
As described above, the most useful information that the 
Taiwans have given us is information which they have 
volunteered.  As the relationship between Taiwan and Panama 
has deteriorated during the past 12 months, the Taiwans tend 
to look more to U.S. diplomats for support and encouragement. 
 We question whether they have a lot to say to us that they 
have not already said. 
 
ARREAGA