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DE RUEHMN #0345/01 1011904
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R 111904Z APR 06
FM AMEMBASSY MONTEVIDEO
TO RUEHC/SECSTATE WASHDC 5662
INFO RUCNMER/MERCOSUR COLLECTIVE
RUEHLP/AMEMBASSY LA PAZ APR SANTIAGO 2825
RUMIAAA/CDR USSOUTHCOM MIAMI FL
RUEHC/DEPT OF AGRICULTURE WASHDC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHDC
RHEHNSC/NSC WASHDC

,C O N F I D E N T I A L MONTEVIDEO 000345 
 
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DEPT ALSO FOR WHA/BSC BARNES, CROFT AND MURRAY 
DEPT PLEASE PASS USTR 
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E.O. 12958: DECL: 04/11/2016 
TAGS: ECON ETRD PREL UY
SUBJECT: MINISTER ASKS FOR SIGNAL OF USG OPENNESS TO AN FTA PRIOR TO VAZQUEZ-POTUS MEETING
 
REF: A. MONTEVIDEO 0306 
 
     ¶B. MONTEVIDEO 0229 
 
Classified By: Charge d'Affaires James D. Nealon 
for reasons 1.4 (b) and (d). 
 
¶1. (U) This is an action request.  Please see Para #5. 
 
¶2. (C) Summary:  Charge met with Industry Minister Lepra on 
April 10, shortly after Lepra's return from the Joint 
Commission on Trade and Investment (JCTI) meeting in 
Washington.  Lepra was positive about the JCTI's atmospherics 
but stressed that an FTA had to be the necessary next step. 
There is strong Cabinet consensus, he said, that ""this is the 
best thing we can do for our country.""  He was clearly 
worried, however, that time was running out and that, only 
three weeks away from the Vazquez-POTUS meeting, the GOU 
still did not know how the USG would respond to a Vazquez 
request to open negotiations on an FTA.  ""I don't want to 
throw my President into a pool without water,"" Lepra said. 
He requested a backchannel signal regarding U.S. openness to 
an FTA with Uruguay.  Lepra also mentioned that Vazquez 
intended to meet with USTR Portman, Commerce Secretary 
Gutierrez and a group of Republican senators ""favorably 
disposed towards Uruguay.""  Post requests Department guidance 
on the likely U.S. reply to Vazquez's expected FTA offer. 
End Summary. 
 
¶3. (C) Charge met with Industry Minister Lepra on April 10, 
shortly after Lepra's return from the U.S., where he led the 
GOU delegation at the latest JCTI meeting.  Lepra was 
positive about the JCTI's atmosperics and looked forward to 
some progress on a few specific issues.  He stressed that an 
FTA had to be the next step, however, and repeatedly 
emphasized that now was the time for Uruguay to grab this 
opportunity, especially in view of next year's TPA 
expiration.  Lepra believed that the GOU's willingness to 
enter into negotiations and its preparation for this 
eventuality over the past several months would lead to quick 
agreement prior to year's end (Note:  This tracks with what 
we heard from Economy Ministry International Trade staff. 
End Note.) 
 
¶4. (C) Asked about internal support for an FTA with the U.S., 
Lepra stressed that there was a strong Cabinet consensus, 
with only ForMin Gargano (Socialist) and Social Programs 
Minister Arismendi (Communist) against.  He noted that even 
influential MPP leader and AgMinister Mujica was in favor. 
We are convinced this is the best we can do for our 
country,"" Lepra said.  When Charge asked how Mercosur would 
react to FTA negotiations with the U.S., Lepra said the GOU 
was convinced that the trade bloc would grant Uruguay the 
exception"" necessary to negotiate bilaterally with the U.S. 
Lula and Vazquez have good relations,"" he said, and he 
believed that Kirchner would approve it also.  He noted that 
a similar exception had been granted to Uruguay when it 
negotiated its bilateral FTA with Mexico, a negotiation led 
by now-Ambassador to the U.S. Carlos Gianelli. 
 
¶5. (C) Lepra lsaid the GOU was holding back, due to the lack 
of clear signals from Washington about U.S. openness to an 
FTA with Uruguay.  While he admitted that neither he nor 
Ambassador Gianelli had formally asked for an FTA when in 
Washington, he noted they had talked at length with USG 
interlocutors about what FTA negotiations would entail, TPA 
timing and other related issues.  Lepra was clearly worried 
about the reply President Vazquez would receive in 
Washington.  ""I don't want to throw my President into a pool 
without water,"" he said.  He requested a backchannel signal 
from the USG about our receptivity to a Vazquez request. 
Vazquez is ready to ask for an FTA when in Washington, Lepra 
said, and he understands that the time has to be now (see ref 
B).  Charge replied that he would try to elicit some answer 
prior to Vazquez's departure for Mexico and the U.S. on April 
¶25.  Post requests Department's guidance on reply to be 
relayed to GOU. 
 
¶6. (C) Lepra then discussed Vazquez's schedule.  The 
presidential party will include ForMin Gargano, Economy 
Minister Astori and himself, and will spend April 26-28 in 
Mexico, and April 29-May 4 in Washington, before flying out 
through New York.  Lepra mentioned that Vazquez would request 
meetings with USTR Portman and Commerce Secretary Gutierrez, 
most probably on May 2 or 3.  A coffee was also being 
arranged with a group of Republican senators ""favorably 
disposed towards Uruguay"" on May 2 (Note:  We understand 
these may include Senators Lugar, Martinez and Coleman.  End 
Note.)  The presidential party will leave Washington for New 
York in the afternoon of May 4, after the POTUS meeting. 
 
¶7. (C) Comment: Lepra and other GOU supporters of an FTA 
(among them Astori and Mujica) clearly believe that the FTA 
issue has come to a head, with the Vazquez-POTUS just three 
weeks away, and that the time to move forward is now, given 
TPA constraints.  GOU negotiators appear to have been 
preparing themselves for this eventuality for several months 
and believe that a negotiation could be quickly wrapped up. 
They believe that vazquez can handle any opposition from 
Mercosur partners through existing channels, as they did when 
they negotiated an FTA with Mexico.  For our part, we need to 
be able to convey a signal back to the GOU, whether positive 
or negative, prior to President Vazquez's departure on April 
¶25.  End Comment. 

Nealon