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C O N F I D E N T I A L SECTION 01 OF 02 BOGOTA 001407 

SIPDIS 

SIPDIS 

E.O. 12958: DECL: 02/08/2017 
TAGS: ASEC ECIN ECON PGOV PREL PTER SNAR CO PA VENZ
SUBJECT: COLOMBIA AND PANAMA:  DIFFERING PERSPECTIVES ON 
SENSITIVE BORDER ISSUES 

REF: PANAMA 00147 

Classified By: Political Counselor John S. Creamer - Reason: 1.4 (b,d) 

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SUMMARY 
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¶1. (C) Tensions increased between Colombia and Panama after 
President Uribe announced he would place greater customs 
restrictions on goods originating from Panama's Colon Free 
Trade Zone.  Panama claims these restrictions would violate a 
customs agreement signed by the two countries in October 
2006, and may take the dispute to the WTO. A Panamanian 
Embassy official said Uribe was playing political hardball 
over Panama's refusal to agree to an expansion of the 
Pan-American Highway through the Darien Gap in Panama.  A 
Colombian Foreign Ministry official said the two issues were 
separate. Uribe announced the restrictions under growing 
pressure from the Colombian business community.  The GoC said 
there had been no recent military action along the border 
along the Panamanian border.  The Panamanian Embassy denied 
reports Panama would require visas for Colombians.  End 
Summary.

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PANAMA OPPOSES HIGHWAY OVER SECURITY CONCERNS 
--------------------------------------------- 
¶2. (C) Panamanian First Secretary Juan McKay said President 
Alvaro Uribe cornered Panamanian President Martin Torrijos in 
Ecuador during President Correa's inauguration on January 15, 
to press for the expansion of the Pan-American Highway 
through the Darien gap between Panama and Colombia.  McKay 
said most Panamanians were opposed to the expansion fearing 
it would facilitate FARC operations in Panama, as well as 
illegal entry by Ecuadorians en route to the United States. 
He said a rise in kidnappings in Panama, primarily Colombian 
on Colombian, prompted Panamanian fears.  McKay also claimed 
that Uribe was pushing the highway expansion for personal 
reasons, since the road would originate in Uribe's hometown 
of Medellin. 

--------------------------------------------- -- 
COLOMBIA SAYS HIGHWAY MAKES GOOD BUSINESS SENSE 
--------------------------------------------- -- 
¶3. (C) Colombian Ministry of Foreign Affair's Latin American 
desk officer Antonio Dimate said the GoC wanted to facilitate 
commerce and to provide infrastructure for the energy 
integration initiatives under Plan Pueblo Panama.  He said 
the highway would make it easier to control access to and 
better monitor the remote border region, ensuring greater 
security for Panama.  He added it did not make sense that 
there was no way to travel by road from Panama to Colombia. 
DiMate also said that any disagreements over the highway were 
purely technical and would be addressed at the working level; 
the two sides had been able to address most environmental 
concerns in a recently established working group. 

--------------------------------------------- --------- 
PANAMA SEES TRADE RESTRICTIONS AS PRESSURE FOR HIGHWAY 
--------------------------------------------- --------- 
¶5. (C) McKay claimed Uribe had threatened greater customs 
restrictions on goods originating in the Colon Free Zone to 
pressure Panama to agree to the highway expansion.  Uribe 
announced the restrictions at the end of January 2007, 
claiming lack of progress on contraband controls.  McKay said 
these moves violated the cooperative customs agreement signed 
by the two countries in October.  He said the political 
motivation behind Uribe's action was clear. Otherwise, Uribe 
would have waited until the end of the three month review 
period (February 6) to announce the restrictions.  McKay 
claimed Panama was doing all it could to comply with 
Colombia's inquiries into Colon businesses, but progress was 
limited by a lack of resources. 

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COLOMBIA SAYS ISSUES ARE UNRELATED 
---------------------------------- 
¶6. (C) DiMate said the highway debate and customs agreement 
were unrelated.  Colombia was unhappy with the large volume 
of contraband originating in the Colon Free Trade Zone, and 
had not linked the customs agreement to the highway.  Under 
the customs agreement, Panama had agreed to prevent merchants 
from illegally selling large volumes of shoes and textiles in 
Colombia for below-market prices--part of the black market 
peso exchange.  Panama had not complied with its obligations, 
however, and the Colombian business community was unhappy. 
The GoC was also tired of dumping that benefited 
narcotraffickers and armed groups.  Members of the Colombian 
Congress were also concerned that endemic corruption in 
Colon--and in Panamanian Customs Director Daniel Delgado 
Diamante's organization--would prevent Panama from ever 
implementing the agreement in an effective manner. 

BOGOTA 00001407  002 OF 002 



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RUMORS OF COLOMBIAN TROOP MOVEMENTS AND VISAS 
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¶4. (C)  Mckay said he had no knowledge of recent reports in 
Panama of Colombian troop movements on the Panama-Colombia 
border, other than widely publicized joint 
Panamanian/Colombian exercises conducted with US military 
forces (reftel).  Colombian military sources told us no 
military actions have taken place within the last month near 
the border, and that activity in Choco was taking place far 
south of the border.  The Colombian Army's 17th Brigade, 
whose area of responsibility includes much of the border 
region, told us they regularly coordinate with their 
Panamanian counterparts. On a separate issue, McKay said the 
Panamanian business community was opposed to the idea of 
requiring Colombians to obtain Panamanian visas.  It would 
not happen, he said. 
DRUCKER 

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