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PP RUEHWEB

DE RUEHMU #0728/01 0902308
ZNY CCCCC ZZH
P 312308Z MAR 06
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC PRIORITY 5797
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUEHCV/AMEMBASSY CARACAS 0606
RUEAIIA/CIA WASHDC
RHEFDIA/DIA WASHINGTON DC
RHEHNSC/NSC WASHINGTON DC

C O N F I D E N T I A L MANAGUA 000728

SIPDIS

SIPDIS

DEPT FOR WHA/CEN

E.O. 12958: DECL: 03/30/2016
TAGS: PGOV ECON KDEM SOCI NU
SUBJECT: AMBASSADOR MEETS WITH PLC MAYORS AND PRIVATE SECTOR LEADERS IN JINOTEGA

REF: A. MANAGUA 0720

¶B. MANAGUA 0124

Classified By: Ambassador Paul Trivelli for reasons 1.4 (b and d)

¶1. (C) Summary: After speaking at a CAFTA workforce briefing, touring a milk products plant certified by the FDA, and inaugurating a USAID-sponsored vegetable packing plant in the northern Nicaraguan department of Jinotega, Ambassador took the opportunity to meet with a group of PLC mayors and the Jinotega Chamber of Commerce. The mayors debated the current PLC presidential candidate selection process and the possibility of entering into multi-party primaries, and accused Sandinista mayors of taking undeclared funds from Venezuela. The Chamber members discussed the upcoming national elections, Jinotega's infrastructure problems, and Nicaraguans reluctance to challenge the PLC-FSLN pact for fear of reprisal. In a separate meeting, Poloff met with local ALN-PC leader Ruby Zeledon, who warned that Eduardo Montealegre is giving too much attention and control to his Conservative and Resistencia allies at the expense of the Liberals who form the base of his support. End Summary.

PLC JINOTEGA MAYORS OK MULTI-PARTY PRIMARIES
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¶2. (C) During a March 29 meeting with Ambassador, five Liberal mayors from the Department of Jinotega discussed the possibility of multi-party primaries, the PLC presidential candidate selection process, and Venezuelan influence on the FSLN. As in past conversations, the mayors insisted that the PLC is the only political force capable of defeating the Sandinistas in November and the flagship party of the Liberals, as proven in the Atlantic Coast elections. At the same time, the mayors asked the Ambassador to help unite anti-Sandinista forces and ensure a Liberal victory. Ambassador inquired whether the mayors would back a proposal for multi-party primaries that included departmental deputy positions. The mayors were cautiously supportive, with one concerned that there is not enough time to organize primaries, while another claimed that &the PLC will win anyway.

¶3. (C) The mayors did not seem concerned by the internal PLC struggle over the method of selecting the party's presidential candidate (Ref A). One said that it is all ∂ of politics,8 and they all insisted that the PLC departmental leaders have not tried to influence the vote on Aleman,s behalf. The mayors rejected Enrique Quinonez, candidacy as &too divisive8 and divided their support between Ramiro Sacasa and Francisco Aguirre Sacasa. Although front-runner Jose Rizo is a native of Jinotega, only one mayor voiced support for him.

¶4. (C) The mayors charged that Venezuelan president Hugo Chavez is giving money to Sandinista mayors, supposedly for campaign activities, that does not appear in the municipal budgets. They claimed that rural Sandinista mayors obtain 500,000 cordobas ($28,571), mayors of department capitals receive 1 million cordobas ($57,142), and Nicho Marenco, FSLN mayor of Managua, has raked in 10 million cordobas ($571,420). One mayor commented that he traveled to El Salvador before its recent municipal elections and witnessed Sandinistas openly campaigning for FMLN candidates.

JINOTEGA BUSINESS CHAMBER: BULLISH ON COMMERCE, SKITTISH ON POLITICS
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¶5. (U) After the lunch with the PLC mayors, Ambassador met with six members of Jinotega,s Chamber of Commerce. Jinotega is the heart of Nicaragua's coffee production ) roughly 75 percent of the country's coffee is produced in the departments of Matagalpa and Jinotega. During a year of high world prices -- ideal weather conditions combined with the Jinotega,s cool, mountainous soil -- have produced a bumper crop, so much so that 100 pound bags of product have overflowed existing warehouse space and are lying on pallets awaiting shipment to domestic and international markets. Jinotega,s Chamber leadership represented Bancentro, a new 26-unit hotel catering to business, the community's leading restaurant, a pharmacy and other medium-sized businesses. They all lamented the poor condition of the road from Sebaco to Jinotega, to which the Ambassador quipped that his bruised kidneys bore testimony to their complaints.

¶6. (SBU) Chamber members suggested that beyond infrastructure problems that leave the department relatively isolated, fears about Nicaragua's political future present a major obstacle to investment. The Bancentro manager remarked he has yet to see deposits moving out of accounts as in previous election years, but he offered that potential investors have entered the &five-year cycle of uncertainty8 and are waiting and watching. With respect to the elections, the chamber indicated that Jinotega is predictably anti-Sandinista, but one member with professed ties to Eduardo Montealegre criticized a lack of opportunity to &vote for the candidate of your choice given the control of traditional parties.8 He asserted that problems related to the Ortega-Aleman Pact ) the administration of justice and legal land title ) also complicate commerce in the region. Evincing a trepidation that is often expressed by entrepreneurs, chamber members expressed frustration over Nicaragua's &quiet democracy,8 in which a fear of reprisal frustrates active political participation.

¶7. (SBU) In response to Ambassador's Trivelli,s direct question about whether Chamber members view his messages on Nicaraguan democracy and the November elections as foreign interference in domestic affairs, as Daniel Ortega and PLC leaders often protest, one chamber member praised the Ambassador for giving voice to an unspoken majority view. Another, while agreeing with the substance of the message, wondered if it could be more effectively delivered. When pressed, she suggested that the message could be "more diplomatic,8 and that the voices of those who suffer from poverty and lack of education, health and economic opportunity might be used as another way of coming to the same point.

¶8. (U) With respect to the region's road, what should be an easy 45-minute drive from Sebaco to Jinotega along 60 kilometers of picturesque valleys bordered by mountains is a jarring two-hour journey. These conditions slow the movement of 75 percent of the country's coffee crop and 30 percent of its potato crop, increasing transportation costs. The poor infrastructure also impedes greater use of Matagalpa and Jinotega as weekend or vacation mountain retreats from the high temperatures of the lowlands around Managua, Grenada and Leon. There is currently a proposal for the repair of the 28 kilometer leg from Sebaco to Matagalpa with support from the IDB. According to sources at the Ministry of Transportation and Infrastructure (MTI) that project is expected to "start soon.8 (Note: A recent news report suggests, however, that road construction may be delayed again. End Note.) The 32 kilometer road from Matagalpa to Jinotega will be repaired with funds from the Central American Bank for Economic Integration. MTI expects that the loan will be approved by June and that construction will begin in the second-half of the year. In April, MTI will make some stopgap improvements to the road between Matagalpa and Jinotega.

MONTEALEGRE ALLY CLAIMS THAT EDUARDO IS NEGLECTING BASE
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¶9. (C) Poloff met separately with Department of Jinotega ALN-PC leader and National Assembly alternate deputy Ruby Zeledon to discuss her perspective on the Atlantic Coast elections and other issues. Zeledon remarked that the ALN-PC leadership )- including Montealegre, Maria Eugenia Sequiera, and Jamileth Bonilla -- put too much stock in poll results, and that the PLC can and will use manipulation and misinformation, especially in rural areas, to weaken the ALN-PC. She said this is a lesson learned from the Atlantic Coast. Zeledon commented that the ALN-PC was strong on the Atlantic Coast where the alliance selected &good candidates8 and weak where they ran "losers," especially "hacks" from the Resistance party that Montealegre allowed to run to placate his alliance partners.

¶10. (C) Zeledon complained that Montealegre is giving too much attention to the Conservatives and the Resistance at the national level, while at the local level these two groups add nothing to the alliance. She claimed that she has attempted, on several occasions, to coordinate campaign activities with local Conservative and Resistance leaders, but they refuse to participate or help fund outreach trips. Zeledon further commented that the &true Liberals8 who have left the PLC to support Montealegre feel neglected and taken for granted.

¶11. (C) According to Zeledon, Montealegre,s close public association with Conservative and Resistance leaders tarnishes his Liberal credentials and will hurt him in the elections. She also noted that ALN-PC deputy Jamileth Bonilla and ALN-PC campaign manager Eliseo Nunez supported Aleman in the past and have committed other &questionable acts8 that could damage Montealegre by association.

¶12. (SBU) Zeledon agrees that Montealegre should select a female vice presidential running mate. She said that he should chose a political person without a questionable past and with solid Liberal credentials, someone like her, she implied.

COMMENT
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¶13. (C) The concerns expressed by the mayors, Chamber members, and Zeledon are not unique to Jinotega. Emboffs have heard similar comments in other areas of the country regarding Venezuelan contributions to the Sandinistas and the reluctance of the general population to criticize the Pact. Though Zeledon was especially impatient with Montealegre's ongoing chumminess with the Conservatives and the Resistencia, other ALN-PC officials have criticized Montealegre for the same reasons and warned that he may alienate Liberals. Our recent trips to the departments have given us valuable insights not always available within the insular Managua "bubble."
TRIVELLI