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O 200925Z FEB 07
FM AMEMBASSY MANILA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 5329
RUEHZS/ASEAN COLLECTIVE IMMEDIATE
RHHMUNA/CDRUSPACOM HONOLULU HI IMMEDIATE
RUEHRC/USDA WASHDC IMMEDIATE

UNCLAS SECTION 01 OF 04 MANILA 000561 
 
SIPDIS 
 
SBU 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV PREL ECON EAID RP
SUBJECT: USS BLUE RIDGE VISIT CATALYST FOR EMBASSY OUTREACH TO THE 
PHILIPPINES' "SECOND CITY" 
 
¶1. SUMMARY: The February 11th-14th visit of the USS Blue Ridge to 
Cebu provided an opportunity for a coordinated, Mission-wide 
outreach to the Philippine's second largest metro area. Cebu's 
importance extends beyond its "second city" status, as its central 
location in the Philippine archipelago makes it a hub for transport, 
media, and business for much of the central and south Philippines. 
Cebu, once home to a US Consulate, maintains a strong USG profile 
through the Mission's only Consular Agent. The local and national 
media took note as Ambassador interacted not only with Cebu's 
political, business, and civil society leaders, but also with the 
ordinary people of Cebu in a range of venues.  Representatives of 
several Mission sections used the attention generated by the USS 
Blue Ridge visit to spotlight long-standing Mission programs and 
contacts throughout Cebu.  END SUMMARY. 
 
ENGAGING A WIDE SWATH OF CEBU LEADERSHIP AND SOCIETY 
---------------------- --------------------- --------- 
 
¶2. The Ambassador began her outreach in Cebu on February 11th by 
hosting a dinner for political, business, media, and cultural 
figures, including Gwendolyn Garcia, governor of Cebu Province. 
Commander of the 7th Fleet VADM Douglas Crowder and senior officers 
from the USS Blue Ridge attended so that they could directly 
interact with important Cebuanos. Echoing the Mission's 
multi-pronged strategy for its Cebu outreach, officers from the 
Political, Economic, JUSMAG, Public Affairs, and Cebu Consular 
Office were also present to advance U.S. interests. The dinner, 
marked by a lively atmosphere, provided an informal forum for the 
Mission and 7th Fleet to stress the positive aspects of the 
US-Philippine relations that underpinned the visit of the USS Blue 
Ridge. 
 
¶3. The dinner acted as a prelude to a reception for several hundred 
people from Cebu and the surrounding area co-hosted by the 
Ambassador and VADM Crowder aboard the USS Blue Ridge on the evening 
of February 12th.  Once again the benefits of the strong 
US-Philippine relationship were the focus of brief remarks by 
Ambassador and VADM Crowder: Governor Garcia enthused on the ties 
between Cebu and the United States, and thanked the United States 
for its contributions to the Philippines.  The beautiful setting 
aboard the ship in Cebu harbor allowed Mission officers (including 
DCM) and 7th Fleet crewmembers to interact with Cebu's leaders and 
media, ordinary Cebuanos, including school children and teachers, 
officers and enlisted men of the Philippine armed forces, police, 
business and society figures, as well as American residents of Cebu. 
The attendees were clearly thrilled to be aboard ship and the 
reception garnered extensive positive coverage in all the local 
newspapers, as well as some national media. 
 
REACHING OUT TO THE COMMUNITY 
------------- ---------------- 
 
¶4. The crew of the USS Blue Ridge undertook several community 
relation events (COMRELs) while in Cebu. The Ambassador attended two 
COMRELs with VADM Crowder.  The first was a visit to a local High 
School on the morning of February 12th.  The USS Blue Ridge crew and 
Ambassador were warmly greeted as they donated educational and 
athletic equipment and actually participated in repairs and 
renovation of the dilapidated school.  Governor Garcia was present 
and thanked the US for its valued assistance. 
 
¶5. The other COMREL attended by the Ambassador was a trip to a 
Medical Civil Action Program (MEDCAP).  This MEDCAP was a joint 
effort of the USS BLUE RIDGE, JUSMAG, USAID, Philippine military and 
the City Health Office, and included a team composed of 55 Filipino 
and American doctors, dentists, nurses, technicians and dental 
assistants, and some local health workers.  The U.S. Navy provided 3 
doctors, 1 dentist, food for the team and some drugs and vitamins. 
The City Health Office and Philippine military provided 27 doctors 
and dentists, 24 nurses, technicians and dental assistants, allowed 
the use of its dental van, equipment, and supplies.  The 
Municipality of Mambaling contributed the services of their health 
workers and organized the physical arrangements for the MEDCAP.  As 
a result of this collaboration, 671 patients received medical 
services and 102 patients were provided with dental services.  Both 
COMRELs attracted TV and print media, and Ambassador and VADM 
Crowder gave impromptu interviews. 
 
¶6. Another popular and well-covered outreach program attended by the 
Ambassador and VADM Crowder was a free concert given by the 7th 
Fleet Band at a local shopping mall.  The band drew huge audience 
energized by a variety of musical styles, from rock to brass band 
music.  The concert featured participation from a Philippine 
military band, as well. 
 
SHOWING CONCERN FOR THE ENVIRONMENT AND CIVIL SOCIETY 
-------------------- ------------------- --------------- 
 
 
MANILA 00000561  002 OF 004 
 
 
¶7. The Ambassador attended the dedication of a Marine Protected Area 
(MPA) off of the coast of Mactan Island.  USAID helped fund and 
develop the MPA, which is a first of its kind in the Philippines, 
where a local government by virtue of an ordinance enjoins partners 
from the coastal communities, nongovernmental organizations and the 
private sector to become stewards in co-managing marine sanctuaries 
for the purpose of conserving biodiversity and sustainably managing 
coastal-marine resources for food security and ecotourism 
development. 
 
¶8. The Ambassador hosted a lunch for key figures from several 
environmentalist NGOs, including the president of the World Wildlife 
Fund Philippines.  Environmental groups are among the most active 
participants in Cebu's civil society.  Participants praised USAID's 
efforts, while noting there is much to be done.  The Mission's 
Consular agent in Cebu stressed the first steps already taken in 
business stewardship of the environment, and others talked of the 
impressive results of outreach to youth.  Other leaders described 
the need to educate local officials in order to reduce the gap 
between the letter of the laws that preserve the environment and the 
reality of lax enforcement by officials, stemming largely from 
ignorance of the laws. Additionally, because the Philippine Navy 
enforces the laws protecting the Philippine coastlines, discussion 
focused on inviting the US Coast Guard and/or other US military to 
help in educating their Philippine counterparts on ways to fulfill 
their environmental responsibilities. 
 
CONVERSING WITH STUDENTS, EDUCATORS, AND RELIGIOUS LEADERS 
------------------------- ------------------------- --------- 
 
¶9. Ambassador and VADM Crowder visited the University of San Carlos, 
the oldest university in the Philippines, which in the past has 
hosted a variety of USG funded speakers and scholars.  The 
Ambassador held a round-table discussion with students from several 
departments, particularly political science, economics, and 
management. VADM Crowder and the Ambassador delivered remarks after 
which students and faculty spent almost an hour asking various 
questions. While some questions focused on the sensitive issue of 
the Visiting Forces Agreement, others addressed broader issues such 
as the US policy on climate change, globalization, and the upcoming 
Presidential elections in the US.  The tone throughout was informal 
and friendly, although pointed at times. 
 
¶10. Ambassador also visited the Cebu International School, whose 
student body is 20% American, and which services many of the 
children of the international businesses investing in Cebu. The 
State Department has funded $68,000 in Soft Target Security 
Initiative (STSI) monies to the Cebu International School, with 
close coordination from RSO Manila.  The Ambassador toured the 
school and met with a group of students. Questions elicited the 
Ambassador's opinion on topical issues, including more questions 
about US policy on climate change and the upcoming US elections. 
 
¶11. The Ambassador paid a very cordial courtesy call to Ricardo 
Cardinal Vidal, Archbishop of Cebu and one of three Filipino members 
of the College of Cardinals.  Cardinal Vidal thanked the Ambassador 
for continual U.S. support for democracy in the Philippines, 
particularly during President Marcos's ouster, in which he played a 
significant role.  He expressed concern over an initiative to break 
up Cebu into four provinces but added that he was prepared to make 
the necessary adjustments in his archdiocese should the break-up 
occur. Cardinal Vidal, who recently turned 76, indicated he had 
reached retirement age (75) and was merely waiting for the Pope to 
find a replacement so he could retire. 
 
DISCUSSING THE CLIMATE FOR US BUSINESSES IN CEBU 
--------------- ------------------------- --------- 
 
¶12. Over 100 American businesses operate in Cebu, including Timex, 
Lear Corporation, Lexmark International, and Fairchild 
Semiconductors. Lexmark has both a production facility and a 
research and development (R&D) facility in Cebu, and the Ambassador 
visited the R&D facility.  The Lexmark R&D facility has over 500 
employees now, and plans to expand to over 1100 once they finish 
building their new facilities.  Like most other US businesses 
operating in Cebu, almost all of the employees are Filipinos. 
Lexmark is a business specializing in computer printers, and was 
originally a branch of IBM before splitting off in 1991.  It first 
started operations in Cebu in 1999, and which is now one of their 
three major international locations. 
 
¶13. Lexmark R&D's President outlined several of the factors that 
make Cebu an attractive venue for US businesses, such as: 
 
- Cebu's international airport makes it a centrally located hub 
within Asia. 
- A strong tradition of English-language fluency among the 
population, particularly among the large pool of well-educated 
 
MANILA 00000561  003 OF 004 
 
 
graduates of local universities and technical schools. 
- Operating costs are 30% less than Manila, and quality of life is 
better than in Manila due to less pollution, traffic, and 
overcrowding. 
- Tax incentives in the Cebu Economic Zone 
 
¶14. A tour of the facility showed that Filipino engineers are on the 
forefront of high-tech research and development and design of new 
printer and computer technologies.  Lexmark also noted with pride 
its role as a good corporate citizen--an emerging concept in the 
Philippines. Lexmark employees have "adopted" a local school, 
setting benchmarks to measure the impact of the volunteer hours and 
money donated by Lexmark's employees. 
 
WIDESPREAD PRESS COVERAGE GENERATED BY VISIT 
---------------- ------------------- --------- 
 
¶15. Ambassador did exclusive interviews with GMA TV and ABS-CBN TV, 
the two largest national networks in the country, plus several 
stand-up interviews on the margins of various events.  A story on 
the Cebu stop of the Blue Ridge appeared in Manila on ABS-CBN as 
well.  The Ambassador also talked to a local cable channel during 
the reception aboard the USS Blue Ridge. There was extensive 
coverage of the Blue Ridge reception, all the Blue Ridge events, and 
the Ambassador's visit by local newspapers the Cebu Freeman, SunStar 
Cebu, and Cebu Daily News.  Photographs and articles appeared in 
several Manila-based national newspapers as well through their 
Cebu-based stringers outlining the success of the USS Blue Ridge 
visit. 
 
OTHER ELEMENTS OF MISSION OUTREACH HIGLIGHT US ROLE IN CEBU 
----------------- ------------------------- ----------------- 
 
¶16.  At several events key mission members from the Political, 
Economic and Public Affairs sections, as well as representatives 
from USAID, JUSMAG, and FCS joined Ambassador Kenney. However, 
representatives of these and other sections also took advantage of 
the spotlight on US-RP relations generated by the visit of the USS 
Blue Ridge in order to participate in many events. 
 
¶17. PAS officers: 
 
- Arranged for GMA TV and ABS-CBN TV to visit the Blue Ridge for 
exclusive tours and interviews with relevant personnel, 
- for 7th Fleet Band to do a live interview on DY101 FM radio to 
plug their free public concert, and 
- a group tour of the USS Blue Ridge for the media. 
 
PAS officers also visited American Corners in various locations in 
Cebu. 
 
¶18. (SBU) Poloffs used the Blue Ridge visit to Cebu as an 
opportunity to meet with various prominent government and civic 
figures, including Governor Garcia, Congressmen Raul del Mar and 
Antonio Cuenco, and Cardinal Vidal, to discuss the midterm elections 
scheduled for May 14.  Most major politicians, running unopposed or 
lacking serious opponents, expressed little concern about the 
upcoming elections.  Governor Gwendolyn Garcia, who currently has no 
opponent, said the most significant problem facing the province was 
the campaign by some local congressmen to split up Cebu into four 
provinces.  She is actively campaigning for "one, indivisible, 
Cebu."  Most officials thought the provincial breakup had not been 
sufficiently discussed and would result in four costly, yet 
inefficient, bureaucracies.  Though proponents claim that the 
current provincial government ignores rural communities, some 
interlocutors asserted the initiative is driven by several 
congressmen on their third -- and last - term.  According to this 
view, these congressmen, popular in their districts, yet legally 
barred from a fourth consecutive term, seek to create three new 
governorships they believe they can easily attain.  Measures to 
create new provinces must be initially approved by Congress and 
ratified by referendum. Local officials, such as mayors, 
vice-mayors, and provincial legislators, expressed little interest 
in "Manila" politics.  They were almost unanimous in their belief 
that the makeup of the Senate would have a negligible effect on 
their communities.  Instead, they were concerned with attracting 
foreign investment to their communities, increasing hotel capacity 
to attract more tourists, and gaining the support of neighborhood 
leaders for social initiatives, such as drug awareness campaigns. 
 
 
¶19. ECON and Commercial Counselors met with representatives of the 
Cebu Chamber of Commerce and Industry (CCCI) who discussed the 
strengths of the local economy, with a particular focus on the 
emergence of a vibrant IT/Call Center sector, and prospects for 
development of the tourism sector.  When asked what, if anything, 
constrained growth in Cebu, interlocutors all cited interference 
from Metro Manila as their chief problem. They also called on a film 
 
MANILA 00000561  004.2 OF 004 
 
 
production studio in Cebu run by American executives, a Lear 
Corporation plant manufacturing in Cebu's industrial zone, and 
Fairchild Semiconductor, which produces high-end energy-management 
chips. These businesses echoed Lexmark in citing the international 
airport, desirable location, talented local personnel, and low costs 
as factors for locating in Cebu1. 
 
¶20. USAID Mission Director and staff visited Celestica Philippines, 
Inc. at the Mactan Export Processing Zone 1.  This firm is a 
recipient of USAID assistance to establish and strengthen a 
workplace health program that includes the provision of family 
planning and maternal and child health services.  Celestica 
Philippines, Inc. employs around 1,200 who are benefiting from the 
workplace health program. 
 
¶21. The Agricultural Counselor visited the flour milling plant of 
General Milling Corporation (GMC) in Cebu province.  GMC is the 
third largest flour milling company in the Philippines. Although GMC 
is a Filipino company, it is a loyal U.S. wheat importer importing 
100% U.S. wheat.  Its oil crushing factory uses only beans from the 
United States. 
 
KENNEY