VZCZCXYZ0000
RR RUEHWEB

DE RUEHMU #2383/01 2991541
ZNR UUUUU ZZH
R 261541Z OCT 06
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC 8015
INFO RUEHME/AMEMBASSY MEXICO 4023
RUEHRC/DEPT OF AGRICULTURE WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC

UNCLAS MANAGUA 002383 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR WHA/CEN, EB/TPP 
DEPT PLEASE PASS TO USTR 
DEPT OF AGRICULTURE FOR USDA/OIT AND USDA/COTS 
 
E.O. 12958: N/A 
TAGS: ETRD EAGR WTO NU
SUBJECT: NICARAGUA: LETTER TO USTR SCHWAB FROM TRADE 
MINISTER ARGUELLO 
 
¶1. (U) On October 19, the Embassy received a letter in 
Spanish dated October 16 and addressed to U.S. Trade 
Representative Susan Schwab from the Minister of Trade, 
Industry, and Development Alejandro Arguello.  We offer the 
following English translation to speed communication while we 
forward the original to USTR.  We draw attention to 
Arguello,s reference to U.S. subsidies on peanuts, which we 
explain further in Paragraph 3. 
 
¶2. (SBU) Begin informal translation of text. 
 
Susan C. Schwab 
Executive Office of the President 
The United States Trade Representative 
Washington, D.C. 20508 
United States of America 
 
Dear Ms. Schwab: 
 
I have the pleasure of writing to you in reference to your 
recent communication, where you presented the U.S. commitment 
put forth by President Bush at the General Assembly this past 
September and shared some ideas about how to contribute to 
the success of Doha Development Agenda negotiations. 
 
In this respect, Nicaragua hopes that multilateral trade 
continues to contribute to the economic growth, sustainable 
development, and improvement in the standard of living of WTO 
member countries.  This is the reason why we expect and trust 
that Doha Development Round negotiations will arrive at a 
happy conclusion, according to the mandate set forth in the 
WTO Ministerial Declaration of November 2001. 
 
Nicaragua, as a small economy and according to its level of 
development, is in an excellent position to contribute 
towards achieving a satisfactory outcome of trade 
negotiations for all.  For this reason, all countries must 
detail flexibilities in their negotiating positions, trusting 
like you, that this will result in mutual understanding of 
key issues, with the aim of restarting talks and putting the 
negotiations on a path toward achieving ambitious results. 
 
For this reason, I am pleased to hear that the United States 
stands ready to eliminate all tariffs, subsidies, and other 
obstacles to the free flow of goods and services.  Beyond 
this, I share your flexible approach, and will demand that 
other members adopt a similar approach. 
 
We are convinced that the elimination of these types of 
policies is crucial for Nicaragua, since it would favor an 
increase in trade flows of products that currently benefit 
from large state subsidies and market interventions, as in 
the case of peanuts.  I am sure that the elimination or 
substantial decrease in such market interventions would 
encourage trade between our two countries. 
 
I reiterate the willingness of Nicaragua to work in the way 
that you expressed in your letter, and hope that you are 
successful in consultations, both internally and with 
colleagues in other countries, so that the current break in 
negotiations permits the reflection necessary for 
negotiations to resume without further delay. 
 
Without further business, I would like take this opportunity 
to express to you my highest consideration and esteem. 
 
Alejandro Arguello 
Minister of Trade, Industry, and Development 
Republic of Nicaragua 
 
End informal translation of text. 
 
¶3. (SBU) In reference to Minister Arguello,s mention of U.S. 
subsidies on peanuts, we can pass along that Arguello is 
clearly under pressure from local peanut producers who are 
complaining bitterly about U.S. competition, particularly in 
Mexico.  Nicaraguan peanut producers believe they could 
expand regional exports rapidly if they did not have to 
compete with exports of subsidized U.S. peanuts.  In recent 
weeks, Arguello has raised the topic with us on more than one 
occasion, saying at one point that he was considering the 
possibility of filing a WTO case.  We explained to him that 
the issue of agricultural subsidies had to be managed within 
the context of Doha Development Agenda talks, and advised him 
to approach USTR separately with his concerns.  This letter 
 
may be his opening salvo. 
TRIVELLI