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

C O N F I D E N T I A L SECTION 01 OF 02 SAN JOSE 001746 
 
SIPDIS 
 
E.O. 12958: DECL: 08/03/2015 
TAGS: PBTS PREL PINR ETRD CS NU
SUBJECT: BORDER DISPUTE WITH NICARAGUA THREATENS TO FLARE 
UP AGAIN; COSTA RICA SEEKS ARBITRATION 
 
REF: A. 02 SAN JOSE 2260 
     ¶B. 02 SAN JOSE 2589 
     ¶C. 02 SAN JOSE 2818 
 
Classified By: Charge Frederick J. Kaplan for reasons 1.4 (B) and (D). 
 
SUMMARY 
------- 
 
¶1.  (C) In an August 1 meeting with Charge and acting DCM, 
Foreign Minister Roberto Tovar said that the dispute over the 
navigational rights of Costa Rican police on the San Juan 
River threatens again to disrupt relations between Costa Rica 
and Nicaragua.  Tovar noted that the three-year "truce" on 
the matter was about to expire and that Costa Rica, to 
preserve its rights, would have to either bring a case before 
the International Court of Justice (ICJ) or convince 
Nicaragua to agree to arbitration of the matter.  The GOCR, 
Tovar said, far preferred the latter course, which it 
regarded as "less confrontational."  Tovar asked that the USG 
help persuade Nicaragua that an arbitrated resolution of the 
issue was in the interest of both parties.  End Summary. 
 
IMPLICATIONS FOR CAFTA-DR 
------------------------- 
 
¶2.  (C)  Foreign Minister Roberto Tovar called Charge to his 
office on August 1 to discuss, he said, "Nicaragua and 
CAFTA."  Charge was accompanied by acting DCM and Tovar by 
Costa Rican Ambassador to the OAS Javier Sancho.  Tovar 
explained the relationship between the Costa Rican-Nicaraguan 
border dispute and the U.S.-Central American-Dominican 
Republic Free Trade Agreement (CAFTA-DR) in the following 
manner:  If Costa Rica asserts its rights to have its police 
navigate the San Juan River, the Nicaraguan National Assembly 
is liable to retaliate by slapping a 35 percent tariff on 
Costa Rican goods, a violation of CAFTA-DR (assuming that 
both countries ratify the treaty).  Relations between 
Nicaraguan President Bolanos and Costa Rican President 
Pacheco and between Nicaraguan Foreign Minister Norman 
Caldera and Tovar are excellent, and Tovar wants to use the 
existing good will in the executive branches of the two 
governments to find a face-saving and permanent solution to 
the San Juan problem. 
 
COSTA RICAN VERSION OF HISTORY 
------------------------------ 
 
¶3.  (U)  Tovar traced the history of the issue to the 1858 
Treaty of Canas-Jerez.  The treaty granted to Costa Rica the 
territory that now constitutes the northwestern portion of 
the country and to Nicaragua sovereignty over the San Juan 
River (both banks).  Approximately 80 miles of the 
192-mile-long Nicaragua-Costa Rica boundary runs along the 
right bank of the San Juan from the Caribbean Sea upstream to 
a point three miles below Castillo Viejo.  The treaty grants 
to Costa Rica perpetual free navigation "with the object of 
trade."  Disagreements soon arose because Nicaragua contended 
that Costa Ricans could navigate the San Juan only to move 
merchandise, while the Costa Ricans claimed also the right to 
commercial travel of people.  In 1888, according to an 
arbitral award of U.S. President Grover Cleveland, Costa Rica 
could not put warships on the river but could deploy revenue 
service cutters "for the protection of commerce." 
 
¶4.  (SBU)  Today, Tovar said, the GOCR has a need to use the 
river for the transport of its local police, who usually 
carry side arms.  They are not carrying out a law enforcement 
function on the river, which is admittedly Nicaraguan 
territory, but are simply using river boats as a form of 
transportation from post to post.  (There are few roads in 
the area.)   Nicaragua, however, requires Costa Rica to 
request authorization, which Costa Rica believes it doesn't 
need.  Costa Rica was prepared to take the matter to the 
International Court of Justice (ICJ), but on October 23, 
2001, then-Nicaraguan President Aleman filed a motion with 
the ICJ alleging that the court lacked jurisdiction over 
disputes involving treaties signed by the GON before 1901. 
The GOCR had one year to answer the motion.  If it failed to 
do so, it would forfeit the case. 
 
¶5.  (C)  In August and September 2002, Tovar and Caldera 
began working together to find a way to avoid a court battle. 
 Because of the difficulty of devising a permanent solution 
in a short amount of time, the GOCR proposed a "truce," which 
preserved the right of Costa Rica to seek ICJ intervention, 
but only after three years.  During this period, the GOCR and 
GON intended on their own to work out their differences 
regarding the San Juan River.  Negotiations were hard fought, 
and the agreement went through 40 drafts but was finally 
signed by the GOCR and GON on September 26, 2002. 
 
TOVAR SEES NO CHANCE FOR NEGOTIATED SOLUTION 
-------------------------------------------- 
 
¶6.  (C)  It soon became clear, according to Tovar, that a 
"political solution" to the San Juan dispute was impossible. 
If there is one thing that all Nicaraguans agree on, Tovar 
said, whether they are Sandanistas or Somozistas, it is that 
ceding anything to Costa Rica with regard to the San Juan is 
treason.  At the same time, Costa Ricans cannot accept the 
status quo.  Therefore, having a third party decide, Tovar 
believes, is the only way out.  Tovar worries, however, that 
a full-blown court case in the ICJ would inflame passions in 
both countries and ultimately leave one country embittered. 
He believes the mere filing of a Costa Rican petition in the 
ICJ would provoke a highly nationalistic Nicaraguan National 
Assembly and affect nearly USD 300 million in trade between 
the two countries. 
 
¶7.  (C)  Tovar's solution to the problem is arbitration, 
which he deems "less confrontational" than going to court. 
He thinks the arbitration could be conducted in the ICJ 
itself or perhaps the Permanent Court of Arbitration.  He did 
not warm to Charge's suggestion of the OAS, which he seemed 
to think insufficiently authoritative.  The problem now is 
convincing the GON.  Tovar said he was sending Ambassador 
Sancho to Managua in ten days to broach the subject with 
Nicaraguan MFA adviser Mauricio Herdocia whom both Tovar and 
Sancho believe is solid and completely trusted by Minister 
Caldera. 
 
CALL FOR U.S. HELP 
------------------ 
 
¶8.  (C)  Tovar asked that the USG use its influence with the 
GON to help persuade the GON of the wisdom of an arbitrated 
resolution of the issue.  The alternative is the 
"total-warfare" atmosphere of the courtroom, which will not 
serve the interests of either country.  Tovar harked back to 
CAFTA-DR, noting the intention of the parties of the treaty 
to break down barriers between member countries and to avoid 
conflict.  Charge responded that he would report fully to 
Washington. 
 
COMMENT 
------- 
 
¶9.  (U)  Tovar is not the only one in Costa Rica worrying 
about the San Juan.  During a breakfast with tourism industry 
leaders on July 27, Oscar Arias, the front-runner in the 
February 2006 presidential election, said: "I hope I'm 
mistaken, but there seems to be a very big possibility that 
this controversy (San Juan) will re-emerge.  I hope that 
relations between the two countries don't deteriorate.  I'm 
going to pray that they don't.  I would like our differences 
not to increase so that it does not become necessary for 
either party to resort to international agencies to sort out 
this small conflict." 
 
¶10.  (C)  Costa Rica and Nicaragua squandered most of the 
three years allotted for finding a negotiated solution to the 
San Juan controversy.  Only in the last few months have there 
been quiet, low-key, and almost casual discussions between 
the countries about the San Juan.  The first serious strategy 
meeting on the subject in the Costa Rican MFA since the 
agreement of 2002 was the very morning of our August 1 
meeting and included Tovar, Sancho, and MFA advisers Sergio 
Ugalde and Arnoldo Brenes.  Their decision was essentially to 
wash their hands, say it's impossible and too late to 
negotiate, and the matter needs to be turned over to someone 
else (an arbitrator).  Three years ago (reftels), Tovar was 
singing a different tune.  We were skeptical then, and, 
unfortunately, time has proved us right - - negotiations have 
gone nowhere, in part because they never got started. 
KAPLAN