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RUEHBO/AMEMBASSY BOGOTA
RUEHCV/AMEMBASSY CARACAS
RUEHGT/AMEMBASSY GUATEMALA
RUEHLP/AMEMBASSY LA PAZ
RUEHMU/AMEMBASSY MANAGUA
RUEHME/AMEMBASSY MEXICO
RUEHSN/AMEMBASSY SAN SALVADOR
RUEHDG/AMEMBASSY SANTO DOMINGO
RUEHTG/AMEMBASSY TEGUCIGALPA

C O N F I D E N T I A L USEU BRUSSELS 001276 
 
SIPDIS 
 
SIPDIS 
 
C O R R E C T E D  C O P Y (TEXT) 
 
E.O. 12958: DECL: 04/16/2017 
TAGS: PREL PGOV EAID EUN MX DR GT CO VZ NI BO ES
HO, XM, XK 
SUBJECT: U.S.-EU MEETINGS ON LATIN AMERICA 
 
Classified By: Deputy Political Minister Counselor Alyce 
Tidball for reasons 1.4 (b) and (d) 
 
¶1. (U) SUMMARY. US-EU Committee on Latin America (COLAT) 
troika consultations, held February 12 in Brussels, included 
discussion of Nicaragua, Venezuela, Colombia, Bolivia, 
Mexico, Brazil, Cuba and Central American gangs.  The U.S. 
delegation consisted of WHA PDAS Charles Shapiro, USEU Deputy 
Political Minister Counselor Alyce Tidball, USAID Counselor 
Pat Lerner, and USEU Poloff Daphne Lyman.   The EU side was 
led by German MFA Director for Latin America  Enver 
Schrombgens, Commission Representatives Marie Anne Coninsx, 
Head of Unit DG Relex G1 and Petros Mavromichalis Head of 
Unite DG Relex G2; Council Representatives Karl Buck Head of 
Division for Latin America and  Nicolas Pascual de la Parte 
Head of Task Force for UN and Latin America; and  Portuguese 
MFA Director for Latin America Helena Coutinho.  2. (C) 
Participants generally agreed on situation assessments for 
most countries, with Cuba presenting the greatest divergence 
of EU and U.S. opinion. Discussions revealed a shared sense 
of growing concern towards developments in Nicaragua, 
Venezuela, and Bolivia, as well as an acknowledgment of 
progress in Mexico and Colombia.  The EU's Latin America 
policy emphasizes the need to promote "social cohesion" 
through efforts to fight poverty, inequality and exclusion. 
Regarding Cuba, the Presidency is currently drafting a 
non-binding policy paper on EU medium and long-term 
strategies toward Cuba.  (NOTE:  Since the February 12 COLAT 
meeting the draft policy paper did not achieve consensus and 
the committee will go back to the Political and Security 
Committee (PSC) for new instructions.  END NOTE.)  The EU 
questioned the continuing usefulness of Helms-Burton, 
identifying it as the major difference in our policies toward 
Cuba.  Shapiro encouraged the EU to be more active in 
promoting democratic changes in Cuba through greater civilian 
and economic engagement.   END SUMMARY 
-------------------- 
¶2. (C) Nicaragua 
-------------------- 
The Portuguese, leading the discussion on Nicaragua, first 
noted some positive democratic developments in the recent 
election of Daniel Ortega such as the opposition's 
recognition of Ortega's legitimate win, Ortega's promise to 
proceed with parliamentary reform, and his decision to remain 
in CAFTA for now.  The Nicaraguans, they said, have high 
expectations of this government to address the huge 
challenges of improving social conditions and eradicating 
poverty.  They noted that Ortega's initial statements seemed 
moderate, but that it is "too soon to see," and they will be 
monitoring his support in the National Assembly and the 
Liberal-Sandinista Pacto, with especial wariness of Chavez' 
influence.  Coninsx, noted that Nicaragua receives one of the 
biggest assistance packages from the EU in Latin America, and 
that the new 2007-13 assistance program will focus on 
promoting good governance and democracy, education (both 
primary and secondary), and the investment climate (with 
attention to the macro-economic side).  Mavromichalis, 
commented with skepticism on Ortega's stance on corruption, 
noting various relatives in high positions (including his 
brother and two sons), and also on the future of the Pacto 
and Aleman, noting that the U.S. and EU need to have a 
position on the situation as it could be difficult to require 
Aleman to stay in jail.  PDAS Shapiro said that the U.S. 
generally concurs with this assessment. 
--------------------- 
¶3. (C) Venezuela 
--------------------- 
Schrombgens led the discussion on Venezuela.  He described 
with great concern the assessment of the direction in which 
Chavez is headed, which very strongly resembles the U.S. 
interpretation.  He mentioned particular concern over Chavez' 
landslide victory and the opposition's unfortunate strategy 
of boycotting parliamentary elections, thus allowing Chavez 
to be granted extraordinary powers.  He noted that Chavez' 
"21st Century Socialism" is very similar to that of the 20th 
Century (a specific observation the U.S. has also made). 
Schrombgens said that Chavez is continuing with his 
self-empowerment through nationalization of private companies 
(Schrombgens was skeptical about the promise of payment in 
full), reshuffling of the Cabinet, censorship (e.g. the 
refusal to renew the broadcasting license of RCTV), and his 
moves to create a single socialist party with participation 
of all Venezuelan citizens.  Schrombgens also mentioned the 
EU's role in election observation as well as the Sumate 
trial.  He stated that the common EU assessment is that "a 
step by step approach and quiet diplomacy are the only ways 
to be influential," noting that Chavez will probably be able 
to maintain this path as long as there is a demand for 
Venezuelan oil. 
 
¶4. (C) PDAS Shapiro agreed with the EU assessment, noting 
that where Venezuela is now has been completely predictable 
as Chavez has done everything he said he would.  He mentioned 
with concern that Chavez is continuing to gain control over 
supposedly independent institutions such as the Supreme Court 
and the Attorney General and is eliminating any checks and 
balances that may have existed in the Venezuelan government. 
He acknowledged that quiet diplomacy is good but "not always 
sufficient," and while praising the EU presence at the Sumate 
trial, encouraged the EU to be more proactive in working with 
political parties and institutions to promote opposition, 
especially as the U.S. currently has little influence (as 
evidenced by the stand-still of coordination on 
counter-narcotics and the lack of response from Chavez to 
U.S. initiatives to engage).  Shapiro also noted some 
concerns not mentioned by the EU such as weapons purchases, 
the growing relationship with Iran, loss of control of 
identification documents, and an increase in potential 
narcotics trafficking activities.  Coninsx from the 
Commission acknowledged awareness of and shared concern over 
these issues in the EU, saying that their response is 
discussions on social cohesion and regional integration, and 
maintaining cooperation with civil society to strengthen the 
opposition without polarization.  She noted that EU 
assistance of about 40 million euros (approximately 52 
million USD) over the next five years will focus on 
governance and diversification of exports. 
-------------------- 
¶5. (C) Colombia 
-------------------- 
PDAS Shapiro, leading discussion on Colombia, praised the 
current direction of the GOC.  He showed appreciation for EU 
and Member State support to date, and encouraged support for 
Colombia,s new "Strategy for Strengthening Democracy and 
Social Development," which will focus on reducing poverty, 
coordinating civilian and military efforts in newly secured 
areas, and pay special attention to minorities and human 
rights.  He highlighted a shift in the balance of U.S. 
funding towards the soft side, noting that the main areas for 
assistance for post-paramilitary demobilization are 
prosecution, OAS monitoring, reparations, and reintegration 
programs.  He also mentioned interest in the GOC-ELN talks, 
but noted that the ELN has some tough decisions to make; they 
should agree to a ceasefire and release their kidnapped 
prisoners.  He noted that the President is visiting Colombia 
in March.  He also mentioned that a U.S.-Colombia FTA is in 
Congress, noting that it will be a different discussion with 
the Democrats in the majority.  He also noted with enthusiasm 
that Colombia grew by 6% last year, saying that economic 
progress will be the key to solving its problems. 
 
¶6. (C) Karl Buck described the recent visits of FM Araujo and 
MOD Santos, who favorably impressed the Europeans.  During 
these visits the EU learned that Colombia would like to 
pursue a South African model of a Truth and Reconciliation 
Commission.  Buck sees reintegration of demobilized 
paramilitary members as the big issue, but also expressed 
concern for the rights of the victims and the problem of 
child soldiers.  He also mentioned progress on the 
humanitarian exchange as three EU governments had been 
permitted to contact the FARC.  He noted with pleasure that 
the EU welcomed the U.S. shift towards  soft, funding.  He 
observed that like Afghanistan, Colombia needed to create a 
stable situation to combat drugs, and also noted the need to 
inform surrounding nations of the risks of condoning or not 
resisting narcotics trafficking from Colombia.  Aude 
Maio-Coliche, Commission DG Relex G3 Colombia Desk, mentioned 
that External Affairs Commissioner Ferrero Waldner is going 
to Colombia in the third week of April.  She also stated that 
the EU provided assistance of Euros 270 million 
(approximately 351 million USD) to Colombia in 2001-06, and 
will program assistance for Euros 160 million (approximately 
208 million USD) in 2007-13.  This will focus mostly on 
supporting communities receiving ex-combatants, with another 
program directed at victims and protecting those who defend 
them.  She also mentioned that the EU had been actively 
participating in the G-24 working group on Colombia. 
Schrombgens asked Shapiro for his thoughts on the scandals 
regarding ties between politicians and paramilitaries, and 
Shapiro responded that it was to be expected that the 
paramilitaries would make such accusations, and that some of 
them may well be true, but regardless it is important for the 
truth and reconciliation process to continue. 
----------------- 
¶7. (C) Bolivia 
----------------- 
Regarding Bolivia, Schrombgens noted that the hope placed in 
Morales as the first president elected by a majority in 
Bolivia was fading as he has failed to use his legitimacy to 
bridge the gaps in society and incorporate indigenous law. 
Schrombgens said there was great concern in the EU about 
Morales' close ties with Venezuela and Cuba, the 
deterioration of the democratic constitution, the prospect of 
legalizing coca cultivation, and the increasing violence. 
Nicolas Pascual de la Parte  mentioned the visit of 
opposition leader Governor of Cochabamba Manfred Reyes Villa 
with HR Solana, noting that he seemed to be delivering a 
"catastrophic scenario" of a secession movement in the east, 
and also criticized Morales for adopting the pretension of 
being able to start Bolivia over from scratch. 
 
¶8. (C) PDAS Shapiro agreed with the general concerns, noting 
that both sides of the internal Bolivian conflict were 
employing confrontational tactics that were exacerbating 
ethnic tensions.  He applauded the Presidency,s statement in 
January on the violence in Cochabamba.  He noted that the 
U.S. still engages with Morales, mentioning trade 
negotiations, and saying that we believe diverse 
international engagement with the GOB will make them be more 
pragmatic, stressing the importance of respecting the rights 
of the legal opposition and strengthening democratic 
institutions for ALL Bolivians, which would have to 
incorporate the indigenous majority.  He also applauded the 
EU,s increased engagement on the cocaine issue, noting that 
most of the drugs resulting from increased coca production in 
Bolivia would probably end up in the EU.  Commission 
representative Coninsx described the EU,s economic aid 
contribution, noting that the EU and Member States account 
for 77 percent of all aid to Bolivia, with the EC focus on 
economic opportunities, the fight against drugs, and 
integrated water management.  She then asked about the 
certification procedure in March, strongly expressing hope 
that the U.S. will continue to engage with the GOB.  Shapiro 
responded that there was fierce internal debate over the 
issue, with political concerns against counter-narcotics 
concerns, noting that he did not know how it would turn out. 
He mentioned that the reduction of funding for U.S. 
counter-narcotics activities reflected a re-prioritization of 
assistance efforts which was accompanied by an increase in 
other areas, although the overall budget had decreased. 
------------------ 
¶9. (C) Mexico 
------------------ 
PDAS Shapiro led discussion on Mexico, expressing pleasure 
with the initial months of Caldron's presidency.  Coninsx 
noted that the EU has strong relations with Mexico and 
considers it a rich to middle-income country with regional 
disparities.  The EU's modest 2007-13 assistance package will 
focus on social cohesion as the main concerns now are 
inequality and the rise of violence, as well as lessons 
learned from EU regional policy.  She asked about the U.S. 
stance on crime and immigration, two key issues.  Shapiro 
responded that the U.S. is trying to increase cooperation 
with the GOM on northern border security.  He also noted that 
immigration is an essential part of the relationship (as 
evidenced by the fierce public debate currently occurring) 
because of the wage differential and the need for workers in 
the U.S, mentioning the three approaches proposed by the 
Administration focusing on border control, employer 
sanctions, and temporary worker visas to match workers with 
jobs.  He also noted that we are encouraging Mexico's efforts 
to take a leadership role in Central and indeed all of Latin 
America, for example with th Plan Puebla-Panama to reduce 
energy costs in Central America through homogenization of 
standards, building an oil pipeline from Mexico, and 
connecting the electrical grids.  Coninsx agreed that energy 
will be a key theme in the future of EU relations with Mexico 
and all of Latin America.  Pascual de la Parte then discussed 
Calderon's visit to Europe, saying that the emphasis was on 
the need for foreign investment, and ensuring political 
stability and a legal framework to foster such investment. 
He believes that the recent reduction in oil revenues could 
give Calderon the opportunity he needs to reform the fiscal 
system, and even open the door for the foreign investment in 
energy currently not allowed in Mexico.  He also mentioned 
that Solana will be visiting Mexico on 17 April, on his way 
to the Rio-EU summit meeting in Santo Domingo (18-20 April). 
----------------- 
¶10. (C) Brazil 
----------------- 
Leading the discussion on Brazil, PDAS Shapiro noted that the 
U.S. cooperates with Brazil on energy, health, environment, 
science and technology, and biofuels, and that we have good 
working level relationships in the areas of law enforcement 
and counter-narcotics.  The major concerns are inequality, 
drugs and terrorist financing.  He mentioned the need to 
encourage Brazil to take advantage of its potential 
leadership position  by encouraging Lula as a leader of the 
modern, forward-looking left to exert more influence on his 
neighbors, and conveying to the Brazilians that they have 
much to lose by political instability and increased drug 
trafficking in Bolivia.  Regarding biofuels, Shapiro noted 
that the U.S. and Brazil account for 80% of the world's 
ethanol production, and said a market-driven approach is 
needed for expansion, targeting poor economies with 
production potential.  To that end, ethanol should be turned 
into a commodity, and infrastructure improved to encourage 
private sector development.  He noted that Brazil could 
become an economic superpower if it could break the 3-3.5% 
growth barrier. 
 
¶11. (C)Beatrix Martins, DG Relex G4 Deputy Head of Uni for 
the Brazil Desk, said the EU is helping Brazil attack its 
problem of regional differences by assisting, through 
dialogue and an exchange of best practices, in development of 
a Regional Planning Policy similar to that of the EU.  The EC 
is in the process of organizing an international biofuels 
conference, which Brazilian President Lula will attend, in 
Brussels in early July.  The conference will focus on market 
problems, sustainable development, environmental impact, and 
research progress.  The EU is currently negotiating an FTA 
with Mercosur, but not making much progress due to focus on 
Doha, Venezuela's membership, Bolivian uncertainty, internal 
rows, and a lack of action to address huge structural 
asymmetries within the group.  This brought the discussion 
back to Brazil's leadership role, as they are 70% of 
Mercosur, with strong reiteration by the EU of the need to 
encourage Brazil to "believe in themselves" and assume the 
responsibilities of their new leadership position. 
------------------ 
¶12. (C) Gangs 
------------------ 
PDAS Shapiro led off the discussion by noting the connection 
between Central American and U.S. gangs because of the flow 
of people.  Pascual de la Parte noted that Madrid is now 
experiencing a similar problem.  Shapiro said the U.S. is 
working through OAS and SICA on anti-gang and prevention 
strategies regionally, nationally, in the private sector, and 
in immigrant communities abroad, mentioning the upcoming 
international anti-gang conference in El Salvador during the 
week of April 25, 2007, and stressing as a prevention method 
assisting community based alternatives to gang related 
activities.  Pascual de la Parte mentioned that Spain has 
recently enacted a program to grant "gangs" cultural 
association status with government funding, which has allowed 
the groups to feel integrated and respected, and seems to be 
keeping them under control.  The problem of deportees was 
specifically discussed, as the receiving governments in Latin 
America and especially the Caribbean complain they cannot 
deal with the number of people coming in, citing as a reason 
the lack of information.  Shapiro noted that the information 
is sent from the U.S., but could have the potential to be 
buried in the transfer, provoking the suggestion that the 
records be sent with the persons to whom they refer and a 
general agreement on the need to have a greater sharing of 
information.  This also generated a discussion on the need 
for reintegration programs, potentially similar to those used 
with the Balkan refugees, which essentially stated the need 
to "send them back with something useful in their luggage" 
and focused on training done at a community level.  There was 
also a general acknowledgment of the need for greater 
cooperation on this issue; Coninsx requested information on 
U.S. programs on reintegration. 
----------------- 
¶13. (C) Cuba 
----------------- 
PDAS Shapiro started discussion on Cuba, saying we all want 
the same goal: a transition to a democratic society and not 
the establishment of a dynasty by transferring power from a 
dictator to his brother.  He said it is clear Fidel Castro is 
not coming back, and the current slow-motion scenario now 
makes it more important for us (the U.S. and the EU) to send 
the message that we expect change.  He expressed U.S. 
interest in the EU's new policy paper on Cuba, wondering 
specifically about strategy and political support.  Karl Buck 
responded that there are not many details from the policy 
paper available as it has not been discussed internally.  He 
said the EU is assuming a stable situation in Cuba, noting 
that collective control is in place, there is no opposition, 
and strong nationalism; but he also mentioned that there is 
no common line in the EU as each Member State refers to its 
individual experiences.  He also noted a perceived change in 
the U.S. itself, citing Administration policies, the 
Democratic Congress, and the lack of a charismatic leader of 
the U.S.-Cuban population.  He stated that Cuba is not 
isolated, as demonstrated by its position in the UN Human 
Rights Council, strong support from UNGA, and economic 
support from Venezuela, China and tourism.  All of these 
observations, Buck said, make Helms-Burton seem "silly" to 
the EU, and he asked if it is still useful.  Buck averred 
that Helms-Burton has not been successful, it does not really 
affect Cuba anymore, outsiders are the real victims, and it 
could have a titling effect on the leadership.  Shapiro 
countered by saying that Helms-Burton is a law, not a policy, 
and could allow for more lenient treatment of Cuba if there 
are demonstrable steps towards democracy.  Buck also noted 
that Raul Castro shows great capacity to discuss.  Ultimately 
he thinks the EU's role in transition will be small and aimed 
at supporting peace, especially in light of the large numbers 
of European tourists in Cuba. 
 
¶14. (C)  Karl-Otto Konig, Head of Unit for Mexico, Central 
America, SICA, Caribbean, CARICOM, Ministry of Foreign 
Affairs in Berlin, also representing the Presidency, stated 
that the EU's new policy paper will be based on the Common 
Position of 1996, but will be a non-binding framework drawn 
from a consensus.  It would be a set of recommendations on 
how to engage with Cuba in the medium to long term, setting 
out a strategy to encourage a transition to democracy. 
(NOTE.  We have since been informed that the policy paper 
stalled due to lack of consensus in the Latin America 
Committee and was returned to the Political and Security 
Committee (PSC), which called for the development of the 
strategy paper, for new instructions. The PSC instructed the 
Committee to focus on renewal of the Common Position in June, 
since agreement on a strategy paper is not possible.  END 
NOTE.) 
 
¶15. (C)  Javier Nino Perez DG Relex G1 Policy Officer from 
the Commission, raised questions on how to more actively 
engage the rest of Latin America and how Cuba will position 
itself regionally.  Shapiro responded that Latin America is 
reluctant to engage.  He said that Latin Americans don't like 
to criticize each other, especially as Cuba pushes back. 
Castro is also untouchable as "the number one anti-American," 
and communist parties throughout Latin America have lived off 
of him for 40 years.  He also mentioned that post-transition 
there could be a myriad of other problems we may not have 
even thought about, such as drugs and social services, and 
the burden of dealing with these problems will fall 
disproportionately on the U.S.  He further noted that while 
the Europeans are saying the embargo is a failure, European 
engagement with the Castro government has not brought any 
positive results.  Pascual de la Parte agreed that neither 
strategy has worked, noting there are some considerable 
hurdles to jump over: there is no precedent, there is a need 
to be wary of a nationalist reaction, we cannot expect help 
from the rest of Latin America, our impact is limited with a 
loss of economic influence and political isolationism, and we 
cannot count on the opposition as they are small, 
disorganized and surely infiltrated.  We therefore have to be 
patient and "wait for the situation to be ready" before we 
join in not at the front, but on the side, and with 
complementary strategies.  Pascual de la Parte then said we 
also have to trust each other and exchange information, to 
which Shapiro responded that the U.S. is interested in 
sharing information and views and that some Europeans have 
better access to sectors of Cuban society. He also said that 
the Cuban people deserve to have same right as any other 
nations to decide their own future. 
 
¶16. (C) Buck suggested flooding Cuba with money and contacts 
to invoke rapid change, but Shapiro noted that the UK, 
Canada, Mexico, Spain, etc. have been doing that with no 
results.  Pascual de la Parte said that the Cubans want a 
better standard of living, but have been misinformed and 
manipulated to believe they can achieve this under the 
current regime.  He also noted the need to reassure the Cuban 
public that change is not dangerous, as well to sharpen and 
play on the extreme contradictions of the regime, such as 
human rights issues.  There was general agreement with this 
statement, and Shapiro pushed suggestions for EU action, 
including opening information centers with access to the 
internet and newspapers, distributing literature, recognizing 
legitimate opposition, encouraging the media through venues 
such as Reporters Without Borders, calling publicly and 
privately for democratic steps such as the release of 
political prisoners, encouraging European businesses in Cuba 
to abide by ILO regulations, and encourage the ILO to meet 
with labor leaders.  These were duly noted by the Europeans. 
 
17, (C)  After the Troika consultations, Shapiro held a 
bilateral meeting with the PSC Ambassador of Portugal and 
then informal drinks with Latin American Ambassadors to the 
European Union from Chile, Colombia, Mexico, Brazil, and 
Peru.  The Portuguese hoped to improve relations with Latin 
America during their presidency, noting the large Portuguese 
populations in those countries as well as strong bilateral 
relations with Brazil. To this end they want to strengthen 
the EU's bilateral relations with Brazil, which will focus on 
energy and trade relations with Mercosur, with whom the EU is 
currently negotiating an FTA, and are organizing an energy 
summit in July.  The Latin American Ambassadors demonstrated 
a general frustration with the lack of involvement from the 
EU. 
PDAS Shapiro cleared this cable. 
Gray 
.