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 04 MANILA 005606 
 
SIPDIS 
 
HONG KONG FOR G/TIP AMBASSADOR MILLER 
STATE FOR EAP/MTS, G/TIP, DRL/CRA, EAP/PD 
DRL/PHD FOR ANN MARIE JACKSON 
 
E.O. 12958: DECL: 12/01/2015 
TAGS: PREL EAID ELAB KCRM PHUM KPAO RP HK
SUBJECT: SCENESETTER FOR G/TIP DIRECTOR AMBASSADOR JOHN 
MILLER'S VISIT 
 
REF: A. MANILA 5326 
     ¶B. MANILA 5166 
     ¶C. MANILA 5097 
 
Classified By: political officer Tim Cipullo for 
reasons 1.4(b) and (d). 
 
¶1.  (SBU) Summary.  Our strategic relations with the 
Philippines are important to both countries, and we generally 
work together constructively on global issues, including 
Trafficking in Persons (TIP).  The GRP publicly condemns 
trafficking and has enacted strong laws to combat it. 
However, the ability of the GRP to arrest, try, and convict 
suspects of almost any crime is less than optimal.  In 
addition, GRP efforts are hampered by poverty, corruption, 
unemployment and socio-economic factors that encourage 
migration, weak rule-of-law, and sex tourism.  Mission is 
actively engaged in several programs aimed at increasing the 
capacity of Philippine police, prosecutors, and social 
workers involved with TIP cases, and to address some of the 
systemic weaknesses in the Philippine judicial system.  You 
will see the major players during your visit: President 
Gloria Macapagal Arroyo, Justice Secretary Raul Gonzalez, 
Acting Secretary of the Department of Social Welfare and 
Development Luwalhati Pablo, International Justice Mission 
Director Patricia Sison Arroyo, and Visayan Forum Foundation 
President Cecile Oebanda.  You should use your meetings to 
push for greater GRP efforts to convict traffickers under the 
2003 Anti-TIP law.  In the midst of ongoing political 
turbulence, we encourage you also to underscore the 
importance of rule of law and the constitutional framework 
for resolving political differences, as well as our firm 
opposition to emergency rule, which would undermine the fight 
against TIP, as well as against terrorism and damage ongoing 
defense reform and prospects for more robust economic 
development.  End Summary. 
 
DOMESTIC DISTRACTIONS 
--------------------- 
 
¶2.  (C) President Arroyo continues to fight for her political 
viability, as she struggles against allegations that she 
engaged in cheating to win the 2004 presidential election as 
well as other allegations that were at the basis of a failed 
impeachment effort earlier this year.  These domestic woes 
are distracting her and senior officials from the GRP's 
substantive agenda, including TIP.  The Congress and nation 
have embarked on a course of constitutional change, which 
potentially could transform the Philippines into a 
parliamentary system, with or without a President, within one 
to two years, and possibly create a federal state.  Much 
legislative and political capital and attention will be 
focused on this process over the months ahead.  The Communist 
insurgency, unsettled political situation, or the fight 
against terrorism could prompt an unwise declaration of a 
state of emergency.  We believe emergency rule would prove 
disastrous to the GRP's progress on substantive issues of 
mutual concern -- including TIP -- as well as to investor 
confidence and to the Philippines' international image. 
 
STRATEGIC CONTEXT 
----------------- 
 
¶3.  (C)  Despite never-ending domestic political dramas and 
tensions, the Philippines remains an important strategic 
partner, treaty ally, and a vibrant democracy, as GRP 
officials will welcome hearing from you.  The US is virtually 
the Philippines' indisputable number one partner, no matter 
how much the GRP and President Arroyo herself claim to seek a 
balanced relationship among the US, PRC, and Japan.  Our 
views and opinions matter considerably here, on TIP and other 
key issues domestically and regionally.  Our security 
alliance remains robust and of importance to US troops and 
USG objectives, as well as to those of the GRP, in combating 
terrorism, enhancing regional stability, and fighting 
transnational crime, including TIP. 
 
A REAL TERRORISM THREAT 
----------------------- 
 
¶4.  (C) The terrorism threat here is real.  Porous borders, 
weak institutions, fragile government, a long-running Muslim 
insurgency, and ever-present corruption make the Philippines 
highly vulnerable.  Jemaah Islamiyah (JI) and Abu Sayyaf 
Group (ASG) terrorists continue to elude government forces in 
Mindanao, while the Communist Party of the Philippines/New 
People's Army (CPP/NPA) maintains a country-wide presence 
bent on destabilization.  The Rajah Solaiman Movement (RSM) 
represents a significant worry because of its ties to foreign 
financing and the ability of its members -- Christian 
converts to Islam -- to "blend in."  The Philippines has a 
recent history of terrorist attacks on its own territory. The 
February 28, 2004, bombing of Superferry 14, which killed 
over one hundred Filipinos, was the second worst terrorist 
attack in Asia after the October 2002 Bali bombings, while 
the February 14, 2005 "Valentine's Day" bombs in Manila and 
Mindanao killed and injured many shoppers and commuters. 
 
¶5.  (C) The GRP has, however, racked up some recent 
successes.  On October 26, Philippine military and police 
arrested Ahmad Santos, the fugitive leader of RSM, and eight 
other suspected terrorists at a safe house in Zamboanga.  On 
the same day, Philippine Air Force intelligence operatives 
seized Sattar Yusop, an ASG member under US indictment for 
his role in the Dos Palmas kidnappings.  On October 28, a 
Philippine court convicted and sentenced to death three JI, 
RSM, and ASG terrorists for their roles in the 2005 
"Valentine's Day" bombing in Manila (ref C). 
 
ECONOMY NOT STRONG, BUT STEADY 
------------------------------ 
 
¶6.  (SBU) Our counterterrorism engagement in the Philippines 
ranges from humanitarian relief and development to the 
military and public diplomacy.  USAID's Livelihood 
Enhancement and Peace (LEAP) program has reintegrated over 
28,000 former Moro National Liberation Front (MNLF) 
combatants into productive society as successful farmers, and 
stands poised -- should the GRP sign a peace agreement with 
the Moro Islamic Liberation Front (MILF), as both sides 
increasingly appear to expect in the next year -- to provide 
similar assistance to the MILF.  USAID's broad spectrum of 
development programs (in infrastructure, education, 
governance, health, economic growth, environment, and energy) 
in conflict-affected areas of Mindanao have made a positive 
impact in communities vulnerable to exploitation by 
terrorists, as well as contributed to greater judicial 
efficiency, electoral reform, promotion of rule of law, and 
more thorough attention to TIP efforts nationwide. 
 
¶7.  (U) Although the Philippine economy is growing by nearly 
5% each year, it is constrained by massive debts to both 
domestic and foreign bond-holders.  Combined liabilities of 
the government and state-owned enterprises equal 90% of GDP, 
and the debt-service payments on these loans consume 
two-thirds of the annual budget.  The just implemented 
expansion of the Value Added Tax to include fuel and power 
will help the GRP further to reduce its fiscal deficit and 
increase spending on social services, such as health and 
education, and on the expansion and repair of roads and 
railway lines.  There appears to be a grudging acceptance of 
the need for new taxes to restore fiscal imbalances. 
 
¶8.  (U) A stronger, more stable economy could boost foreign 
direct investment to the Philippines, which flows in at a 
paltry level compared to other countries in East and 
Southeast Asia.  To boost development and prosperity, the USG 
encourages economic reform initiatives toward greater 
privatization, trade liberalization, and open markets, and we 
have worked closely with GRP officials on the Philippines' 
Millennium Challenge Corporation concept paper focusing 
heavily on anti-corruption and revenue enhancement efforts. 
US firms account for the largest stock of FDI in the country, 
and the US is still one of the country's largest trading 
partner, counting trade in goods and services.  Corruption 
remains a significant impediment to investors, along with the 
high cost of electricity, poor infrastructure, bureaucratic 
delays, weak enforcement of intellectual property rights, and 
an unpredictable legal system. 
 
TRAFFICKING IN PERSONS (TIP) 
---------------------------- 
 
¶9.  (U) The Philippines is an origin point for 
internationally trafficked persons and suffers from an 
internal TIP problem.  Most victims are young women.  The GRP 
is publicly steadfast against TIP, and in 2003 Congress 
passed Republic Act 9208, a comprehensive anti-trafficking 
law.  The State Department designated the Philippines as a 
Tier 2 Watch List country in 2004 and re-designated it on the 
Tier 2 Watch List in 2005.  Mission continues to underscore 
the seriousness of the TIP problem with GRP officials 
including the possibility of a downgrade to Tier 3 next year 
if stronger actions, notably convictions of the guilty and 
more prosecutions, are not taken.  The Charge has discussed 
the issue with the President twice during the last month and 
she is looking forward to your visit. 
 
¶10.  (SBU) The GRP's ability to address the problem is 
limited by poverty, unemployment and socio-economic factors 
that encourage migration, a weak rule-of-law environment, and 
sex tourism.  The GRP coordinates anti-TIP efforts through 
the Inter-Agency Council Against Trafficking (IACAT), which 
is chaired by the Secretary of Justice.  GRP enforcement of 
its anti-trafficking law has increased as more law 
enforcement officers, prosecutors, and judges receive 
training, including some funded by USAID.  Dozens of TIP 
cases under the 2003 law are pending, and courts handled down 
the first convictions under this law in November 2005, with 
more expected in the coming months. 
 
¶11.  (U) The Philippines' vibrant NGO community is mobilized 
against TIP.  The US-based International Justice Mission 
focuses on rescuing victims and prosecuting traffickers.  A 
unique feature of Philippine law allows NGOs to act as 
prosecutors.  The Visayan Forum Foundation operates four 
shelters for TIP victims, and has received one grant from DRL 
in 2005 and one from USAID in 2003.  Other NGOs acting 
against TIP include Development Action for Women Network, the 
Coalition Against Trafficking ) Asia Pacific, and the Asia 
Foundation; both have also received USG grants. 
 
¶12.  (U) Mission is actively engaged in several programs 
aimed at increasing the capacity of Philippine police, 
prosecutors, and social workers involved with TIP cases. 
Trainers at USG-funded roadshows have educated officials 
throughout the country about the new anti-trafficking law and 
how to pursue trafficking cases more effectively.  Many of 
the cases currently pending under R.A. 9208 were filed by 
recipients of such training.  Recently, Mission sponsored a 
workshop on TIP for members of the Philippine National 
Police's (PNP) Women and Children's Concern Division (WCCD). 
Trainers highlighted the seriousness of TIP as a global 
issue, as well as application of key Philippine TIP 
legislation.  Local media was extensive and largely 
favorable, despite a few skewed editorial comments linking 
TIP with an ongoing alleged rape case involving U.S. military 
personnel.  The seminar represented a "quick win" for the PNP 
in current reform efforts, in which Mission is playing a 
crucial, ongoing role.  At the same time, a broader USG/GRP 
initiative seeks to address key flaws in the Philippine 
justice system that hamper TIP-related prosecutions, 
particularly a lack of cooperation between police and 
prosecutors. 
 
PRESS THEMES 
------------ 
 
¶13.  (SBU) The Philippines is an exuberant media environment. 
 In both your private and public remarks, we encourage you to 
highlight: 
 
-- TIP:  The USG takes the issue of trafficking extremely 
seriously.  To this end, we are engaged on several fronts to 
increase the capacity of the GRP to fight trafficking.  We 
want to support Philippine efforts to combat the serious 
trafficking problem that exists here.  We know the 
Philippines can do better in this endeavor, and hope to see 
the guilty be brought to justice soon.  Failure to make 
progress could lead to a downgrade to Tier III status in 2006; 
 
-- Partnership:  The Philippines is a valued partner in the 
Global War on Terror, as well as a Major Non-NATO Ally.  We 
look forward to opportunities to advance our substantive 
bilateral agenda including counterterrorism, TIP, 
anti-corruption, and other issues of common concern; 
 
-- Rule of Law:  Rule of law is essential to the success of 
any modern society, whether in prosecution and conviction of 
TIP offenders, in bringing to justice terrorists, in creating 
an attractive investment climate, or in enhancing the rights 
and protecting the rights of citizens.  Stable democratic 
governance is critical to strong relations with major 
partners, including the US, as well as to important reform 
efforts currently underway in key institutions such as the 
Armed Forces of the Philippines and the Philippine National 
Police. 
 
IF ASKED 
-------- 
 
¶14.  (SBU) 
 
--  Alleged rape case:  Six U.S. Marines are now under 
investigation by Philippine officials as well as by US 
military authorities for involvement in an alleged rape in 
Subic on November 1.  They remain in U.S. custody under the 
terms of the Visiting Forces Agreement (VFA).  Some members 
of the press have attempted to claim that our criticisms of 
the GRP's performance on TIP is hypocritical given the 
alleged involvement in a sex crime.  Our consistent line is 
that the VFA provides the mechanism for U.S. and Philippine 
authorities to work together to determine the facts of the 
case.  We intend fully to comply with the terms of the VFA; 
we are committed to seeing justice done; and the accused 
should be presumed innocent until proven guilty.  Just as in 
TIP cases, we want to see justice prevail, while protecting 
the legal rights of the accused. 
 
--  Espionage case:  The October 2005 arrest in the United 
States of an FBI employee of Filipino descent for espionage 
made front page news for weeks in the Philippines, focusing 
on his alleged ties with Opposition leaders Senator Panfilo 
Lacson and former president Joseph Estrada.  Alleged Embassy 
reporting was quoted in the press, apparently designed to 
create discord between the government and the United States. 
This case has received considerable press attention and the 
press may ask you about it.  Our consistent line is that the 
issue remains before the courts and we cannot comment on law 
enforcement matters. 
 
Visit Embassy Manila's Classified website: 
http://www.state.sgov.gov/p/eap/manila/index. cfm 
Jones