VZCZCXYZ0001
OO RUEHWEB

DE RUEHQT #1702/01 1941141
ZNR UUUUU ZZH
O 131141Z JUL 06
FM AMEMBASSY QUITO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4803
INFO RUEHBO/AMEMBASSY BOGOTA PRIORITY 5785
RUEHCV/AMEMBASSY CARACAS PRIORITY 1863
RUEHLP/AMEMBASSY LA PAZ JUL 9945
RUEHPE/AMEMBASSY LIMA PRIORITY 0762
RUEHGL/AMCONSUL GUAYAQUIL PRIORITY 0805
RHMFISS/CDR USSOUTHCOM MIAMI FL

UNCLAS QUITO 001702 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV EC PGOV PINR PREL
SUBJECT: NEW MINGOV NAMED 
 
REF: QUITO 1669 
 
¶1.  Summary:  As part of an ongoing cabinet reshuffle on July 
11, President Palacio replaced Minister of Government Felipe 
Vega with Antonio Andretta and Minister of Public Works 
Derlis Palacios with Pedro Lopez Torres.  While Vega, 
Palacio's fifth Minister of Government, has been linked to 
charges of corruption, there is no clear explanation for the 
dismissal of the low-profile Palacios, who has been with the 
administration since the beginning.  Secretary of 
Communication Enrique Proano announced that these 
appointments would conclude cabinet restructuring.  Only four 
of Palacio's original fifteen cabinet members remain.  End 
Summary. 
 
Vega and Palacios Replaced 
-------------------------- 
 
¶2.  On the evening of July 6, six months before the end of 
his term, President Palacio called for resignation letters 
from his cabinet (reftel Quito 1669).  Minister of Government 
Felipe Vega stated publicly on July 10 that he would resign. 
Palacio accepted the resignations of Vega and Minister of 
Public Works Derlis Palacios, both from the city of Cuenca, 
and on July 11 named Antonio Andretta as Minister of 
Government and Pedro Lopez Torres as Minister of Public 
Works.  Both Andretta and Lopez have held the same posts in 
the past, Andretta under the Noboa presidency (2000-2003) and 
Lopez under the Duran Ballen presidency (1992-1996).  Some 
consider Andretta as part of the "old guard," which suggests 
that he was nominated to avoid political contention. 
 
¶3.  Vega told press on July 7 that some wanted him removed 
for trying to address narcotrafficking, organized crime, and 
police corruption.  Insiders claim the real issue was that 
Vega had become a liability after public charges that he was 
demanding kickbacks from the Guayaquil police chief.  Vega 
publicly denied charges of corruption and attributed his 
surprise exit to "political change."  He claimed that his 
resignation was a personal decision that marks the completion 
of "a cycle in this government" and that he himself suggested 
cleaning out the cabinet last week.  Vega was in office for 
four months -- longer than any of the previous four who held 
this thankless job during Palacio's erratic tenure. 
 
Explanations for Departure 
-------------------------- 
 
¶4.  Press reports suggest the upheaval of the cabinet was to 
raise public opinion of the President and reflected Palacio's 
discontent with the confused and chaotic application of the 
April Hydrocarbons Law.  Secretary of Communication Enrique 
Proano said that the President "never agreed" with the June 
29 regulatory implementation of the law and that the 
Ministers would be working on creating new regulations. 
 
¶5.  Proano insisted that the cabinet reshuffling was 
necessary to intensify government work in "key areas," and 
that the new cabinet will target the "social debt" during 
Palacio's last six months in office.  Oil and budget issues 
are expected to be key in the coming months.  Secretary of 
Communication Enrique Proano claims that oil revenues will be 
used responsibly to address poverty and that social problems 
"could not have been attended to before because of the 
overstretched budget." 
 
Biographical Information: Andretta 
---------------------------------- 
 
¶6.  Antonio Andretta Arizaga, the half-brother of former 
president of Congress Juan Jose Pons, was born in Guayaquil 
on September 11, 1944.  He received an undergraduate degree 
in Political Science and a law degree at Catholic University 
of Santiago in Guayaquil.  His previous positions include 
Minister of the Interior of Guayas and Guayas Police 
Intendant (1972-1975) before he became Director of the 
Guayaquil Chamber of Commerce from 1969-1972 and 1980-1983. 
He served as Governor of Guayas and Head of the 
Administrative Development Secretariat (SENDA) under the 
Duran Ballen presidency.  From 1998-2000 he directed COPEFEN 
(Coordinating Unit of the Emergency Program for El Nino 
Phenomenon) before serving as President of the National 
Transportation Council in 2003. 
 
Biographical Information: Lopez 
------------------------------- 
¶7.  Pedro Lopez Torres was born on December 7, 1929, in 
Quito.  He graduated as a civil engineer from Central 
University in Quito and has extensive experience in 
construction and civil engineering.  From 1972-1974 he served 
as a Quito councilman and from 1974-1976 he was president of 
the Commission of Public Works for the municipality of Quito. 
 Lopez served as Minister of Public Works from 1992-1996, and 
was active in all three of Duran Ballen's presidential 
campaigns.  He has also been a professor at the engineering 
school at Central University and vice-president of the civil 
engineering high school in Pichincha. 
 
Comment 
------- 
 
¶8.  The resignations of Vega and Palacios appear to mark the 
end of the current cabinet shake up.  The appointments of low 
profile officials Andretta and Lopez reflect Palacio's desire 
for a smooth transition out of office. 
JEWELL