VZCZCXYZ0003
RR RUEHWEB

DE RUEHZP #2357/01 3412144
ZNY CCCCC ZZH
R 072144Z DEC 06
FM AMEMBASSY PANAMA
TO RUEHC/SECSTATE WASHDC 9482
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUCNDT/USMISSION USUN NEW YORK 0235
RUEAIIA/CIA WASHDC
RUEHUB/USINT HAVANA 0057
RHEFDIA/DIA WASHDC
RULSDMK/DEPT OF TRANSPORTATION WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RHEHAAA/WHITE HOUSE WASHDC

O N F I D E N T I A L PANAMA 002357 
 
SIPDIS 
 
SIPDIS 
 
FOR WHA/CEN TELLO 
FOR WHA/CCA 
 
E.O. 12958: DECL: 11/29/2016 
TAGS: ETRD ETTC PREL PM CU
SUBJECT: PANAMA/CUBA RELATIONSHIP: TITLE III LIBERTAD ACT 
RESPONSE 
 
REF: STATE 191752 
 
Classified By: Charge d'Affaire Luis Arreaga for Reasons 1.4(b)(d) 
 
¶1. (U) Post answers to reftel questions are based on 
information obtained by the GoP's Comptroller General's 
offices, the GoP Ministry of Foreign Relations, the 
administrative offices of the Colon Free Zone, various 
industry and third country publications and conversations 
with various Panamanian business executives. 
 
--------------------------------------- 
Nature of Panamanian Investments in Cuba 
---------------------------------------- 
 
¶2. (C) Question 1: What are the nature of investments (and 
names, if known) that host country businesses have in Cuba? 
 
¶3. (U) According to an investment study prepared by Spain's 
Society for Industrial Promotion and Reconversion (SPRI), of 
the 43 foreign companies operating in Cuba, six are 
Panamanian. 
 
¶4. (U) The SPRI study states that Panamanian companies 
participate in 18 cooperative production projects in Cuba, 
second only the Spain, which has 29 such projects. 
 
¶5. (U) Copa Airlines maintains offices in Havana and has 
approximately 20 weekly non-stops flights from Panama City to 
Havana.  According to various business executives, Copa 
Airlines is the only major Panamanian company operating in 
Cuba. 
 
¶6. (U) According to the GoP's Ministry of Commerce and 
Industry (MICI), Panamanian exports to Cuba have declined 
from a high of $4.3 million in 1998 to $469,590 in 2005. 
According to MICI, Panamanian exports to Cuba have rebounded, 
totaling $429,038 for just the first six months 2006. 
Principal exports to Cuba are cosmetics, beauty supplies, 
juices, vegetable extracts and aluminum. 
 
¶7. (U) According to MICI, Cuban exports to Panama have ranged 
from a high of $1,151,673 in 2000 to a low of $142,877 in 
¶2002.  However, during 2005 Cuban exports to Panama jumped to 
$15.7 million; of which $15.3 million was cement products 
(fueled by Panama's construction boom).  According to MICI, 
Cuban exports have continued at this increased level during 
the first six months of 2006, totaling $8.0 million. 
 
¶8. (SBU) The bulk of Panamanian/Cuban commerce occurs through 
the Colon Free Zone (CFZ).  According to the CFZ, of the 
approximately 2,400 companies operating in the CFZ, 
approximately 95 do business with Cuba.  Cuban companies and 
Panamanian shell companies owned by Cubans or the GOC use the 
Colon Free Zone as a transit point to import U.S. and other 
goods to Cuba to circumvent the U.S. trade embargo. As of 
2004, Cuban companies owed various companies in the CFZ 
approximately $200 million for goods previously delivered. 
According to the Colon Free Zone, during 2004, approximately, 
$195 million of goods were re-exported to Cuba. 
 
¶9. (U) The GoP does not compile statistics on the amount of 
foreign direct investment made by Panamanian companies in 
other countries. 
 
-------------------------- 
Bilateral Trade Agreements 
-------------------------- 
 
¶10. (C) Question 2: Are there bilateral trade agreements 
between the host country and Cuba? 
 
¶11. (U) On January 27, 1999, the GoP, under the Ernesto Perez 
Balladares administration, and GOC signed an Agreement for 
the Reciprocal Promotion and Protection of Investments which, 
among other things, guarantees that each country shall grant 
the other investment protections and rights no less than 
those received by any other third country. 
 
¶12. (U) On August 31, 2000, the GoP, under the Mireya Moscoso 
administration, and GOC signed an Agreement Relating to 
 
Airlines Services between their Respective Territories and 
Onward Destinations. 
 
----------------- 
Exchange Programs 
----------------- 
 
¶13. (C) Question 3: Are there any exchange programs between 
host country and Cuba, including but not limited to: 
scholarships for host country national to study in Cuba; 
Cuban-paid medical travel for host country nationals; and 
Cuban doctors working in host country? 
 
¶14. (U) On February 16, 1999, the GoP, under the Balladares 
administration, and GOC signed an Agreement for Cultural and 
Educational Cooperation. 
 
¶15. (U) On March 17, 2006, the GoP, under the Torrijos 
administration, and GOC signed a Memorandum of Understanding 
eliminating the need for visas to travel between Panama and 
Cuba for persons holding diplomatic, official, consular or 
special passports.  The Memorandum of Understanding states 
that the purpose of eliminating the visa requirement is to 
facilitate travel and exchanges between officials of both 
countries in order to contribute to an expansion in bilateral 
cooperation. 
 
¶16. (U) Operacion Milagro Panama is actively supported by the 
GoP.  According to GoP figures, as of March 31, 2006, 655 
Panamanians have bee treated by Cuban doctors in Panama and 
750 more are scheduled for treatment.  The GOC sponsors both 
free travel to Cuba and free eye care.  Operacion Milagro 
receives the personal support of First Lady Vivian Fernandez 
de Torrijos, who personally travels to the airport to visit 
Panamanian departing for Cuba.  The First Lady, along with 
the GoP Vice Minister of Health, Dora Jara, supervises and 
coordinates all Operacion Milagro activities. The GOC has two 
eye doctors working in Panama on a rotating basis.  These 
doctors perform pre-screening of Operacion Milagro patients 
at GoP health facilities.  Both GoP and GOC officials 
frequently discuss expanding the reach of Operacion Milagro 
in Panama. The GoP goes out of its way to praise Operacion 
Milagro, whether in presidential speeches, by sponsoring 
full-page newspapers ads extolling the virtues of Operacion 
Milagro and on the websites of its various government 
agencies.   The GoP lists Operacion Milagro as one of 
greatest accomplishments. 
 
¶17. (U) Panama and Cuba have student exchange programs. 
There are currently approximately 400 Panamanian medical 
students at the Latin American School of Medicine in Cuba. 
 
--------------------------------------- 
Promotion of Democracy and Human Rights 
--------------------------------------- 
 
¶18. (C) Question 4: Has the host country, in Post's opinion, 
worked to promote the advancement of democracy and human 
rights in Cuba? This can include: public statements or other 
governmental actions, such as resolutions in the national 
assemblies condemning human rights abuses in Cuba; statements 
in support of democracy following the July 31, 2006 handover 
of power from Fidel to Raul Castro; actions in support of 
civil society in Cuba through host country's diplomatic 
missions or other fora. 
 
¶19. (C) The GoP has not made any public statements in support 
of democracy or human rights in Cuba during 2006.  The GoP 
appears to have done little to support the advancement of 
democracy or human rights in Cuba.  The GoP is strengthening 
its relationship with Cuba through increased 
government-to-government contact and through exchange 
programs such as Operacion Milagro.  The GoP does not support 
any proactive steps to further democracy upon President 
Castro's death or as a result of the transfer of power to 
Raul Castro.  The GoP, however, advocates lifting the USG 
trade embargo on Cuba. 
 
----------------- 
Diplomatic Visits 
----------------- 
 
 
20 (C) Question 5: Have there been any high-level diplomatic 
visits between Cuba and host country in the past six months? 
 
¶21. (U) The GoP and GOC re-established diplomatic relations 
on August 20, 2005 after diplomatic ties were severed in 
August 2004. 
 
¶22. (U) On March 16-18, 2006, GoP ForMin Navarro lead a 
diplomatic and trade mission to Cuba.  He was accompanied by 
Health Minister Camilo Alleyne and Colon Free Zone Users 
Association President Severo Souza. 
 
¶23. (U) In July 2006, Civil Aviation Authority Director 
Eustacio Fabrega visited Cuba to discuss bilateral aviation 
matters. 
 
¶24. (U) On September 14-16, 2006, President Martin Torrijos 
and ForMin Samuel Lewis Navarro attended the 14th Non-Aligned 
Nations Summit in Havana. 
 
¶25. (U) Panamanian companies attended the 24th Annual 
International Trade Fair in Havana, Cuba held October 
30-November 4, 2006. 
 
¶26. (U) On November 3-10, 2006, members of the Cuban Civil 
Aviation Authority attended the Latin American Civil Aviation 
Conference in Panama. 
 
¶27. (U) During the week of November 13, 2006, the President 
of Panama's legislature Elias Castillo visited Cuba during 
which he and the President of the Cuban National Assembly 
Ricardo Alarcon signed an accord to reinforce 
inter-legislative relations. 
 
¶28. (U) During the week of November 20, 2006, Alarcon visited 
Panama to meet with President Torrijos, ForMin Navarro and 
members of the Panama-Cuba Parliamentary Group.  Alarcon also 
attended the Latin America and Caribbean Congress for the 
Independence of Puerto Rico held in Panama. 
Arreaga