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C O N F I D E N T I A L PANAMA 000787 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR WHA/CEN - TELLO 
ALSO FOR WHA/EPSC - SALAZAR AND MARTILOTTA 
ALSO FOR EB/TPP/BTA - LAMPRON 
STATE PASS USTR FOR SCHWAB, VERONEAU, EISSENSTAT, AND MALITO 
USDOC/MAC FOR GAISFORD 
 
E.O. 12958: DECL: 05/15/2017 
TAGS: ETRD ECON PREL PGOV ENRG UNSC OAS PM
SUBJECT: NEGROPONTE AND TORRIJOS DISCUSS TPA, BIOFUELS, 
UNSC, AND OAS 
 
 
Classified By: Ambassador William A. Eaton - Reasons 1.4(b and d) 
 
¶1.  (C) Summary.  In a May 11 call on Panamanian President 
Martin Torrijos, Deputy Secretary of State John D. Negroponte 
and President Torrijos discussed the commercial and strategic 
importance of pending free trade agreements with Colombia, 
Peru, and Panama.  They also discussed the potential of 
biofuels in promoting energy independence and creating jobs. 
The Deputy Secretary praised the GOP for its cooperation with 
the U.S. on counternarcotics and at the UN Security Council 
(UNSC) and for its successful redevelopment of former U.S. 
military installations in Panama.  Torrijos and Negroponte 
looked ahead to the June 3-5 Organization of American States 
General Assembly (OASGA) in Panama, with questions about the 
possible participation (and intentions) of Venezuelan 
President Hugo Chavez.  End summary 
 
GOP Agrees on Strategic Importance of FTAs 
------------------------------------------ 
 
¶2.  (C) In a May 11 Presidential Palace meeting, the Deputy 
Secretary and President Torrijos concurred that free trade 
agreements are commercially, as well as strategically, vital 
for the region.  The Deputy Secretary said that ratification 
of the Colombia, Peru, and Panama deals would be a big 
advance toward creating a bloc in the hemisphere of countries 
committed to democracy and open markets.  He stressed that 
failure to deliver on these agreements would be perilous for 
the region and, in particular, for Colombia.  Torrijos agreed 
and said that Panama would push hard for U.S. ratification of 
its own bilateral Trade Promotion Agreement (TPA), as well as 
the other deals still pending before Congress, precisely 
because of their strategic importance.  He said that the GOP 
had developed "good working relationships" with Congressional 
Democrats, as well as with the AFL-CIO, and that he had 
counseled Colombian President Alvaro Uribe to do likewise. 
The Deputy Secretary said that Uribe was "a hope for 
democracy" 
in Colombia and that failure to ratify the U.S.-Colombia FTA 
would be "a severe blow." 
 
¶3.  (SBU) Torrijos hailed as "good news" the May 10 
announcement by Democratic Congressional leaders and USTR on 
the outlines of a way forward on trade, labor, and 
environmental issues.  Neither he nor Trade Minister 
Alejandro Ferrer foresaw much difficulty in Panama's ability 
to accommodate the labor and environment provisions set forth 
in the May 10 package.  Ferrer stressed the GOP's hope that 
the U.S. International Trade Commission (ITC) would finish 
its report on the TPA's impact well ahead of its scheduled 
September 12 completion date.  First Vice President/Foreign 
Minister Samuel Lewis Navarro said that he would visit 
Washington early the week of May 14 with a group of about ten 
Panamanian and American business leaders to lobby for the 
TPA.  He hoped to meet with, among others, House Ways and 
Means Chairman Charles Rangel. 
 
Biofuels Offer Promise for Energy Independence & Jobs 
--------------------------------------------- -------- 
 
¶4.  (SBU) The Deputy Secretary asked Torrijos about biofuels 
in Panama.  Torrijos said the GOP hoped the TPA, together 
with the development of biofuels, might spur much-needed jobs 
growth in Panama's sugar industry.  Lewis added that the GOP 
saw biofuels as potentially significant, both in terms of 
energy independence and in offering "big opportunities" for 
Panama's impoverished rural areas.  The Deputy Secretary 
agreed, recalling his prior service in Honduras, where he saw 
how important the sugar industry was to creating rural jobs. 
 
¶5.  (C) Noting President Bush's mention of an emerging 
U.S.-Brazil biofuels deal during the Torrijos-Bush Oval 
Office meeting earlier this year, Lewis said that Torrijos 
planned to visit Brasilia in late May with the hope of 
signing an offshoot bilateral deal with Brazil on biofuels 
development.  Assistant Secretary Shannon noted that, as 
neither the U.S. nor Brazil could meet domestic demand for 
biofuels, Central American countries could play a significant 
role as suppliers. 
 
UNSC's Kosovo Issue; Singapore-Panama Ties 
------------------------------------------ 
 
¶6.  (C) The Deputy Secretary thanked Torrijos for the GOP's 
"good cooperation" on international security, including 
counternarcotics and law enforcement, and as a fellow UNSC 
member.  Torrijos chuckled at how Panama's emergence as the 
region's consensus pick for the UNSC late last year came as 
"a big surprise."  He noted that he took a May 10 call on 
Kosovo issues from UN Secretary General Ban Ki-moon.  Lewis 
added that the key on Kosovo would be to discourage Russia 
from exercising its veto and, after his recent visit to 
Moscow, he saw "space for Russia to hold back" on its veto. 
 
¶7.  (C) Torrijos beamed when the Deputy Secretary mentioned 
Panama's "good redevelopment" of former U.S. military 
installations.  He cited the conversion of SOUTHCOM's old 
Headquarters into a node for R&D activities and UN agencies 
(i.e., the "City of Knowledge" complex).  Torrijos also said 
that the GOP recently awarded a $400 million, eight-year deal 
to a British firm (London & Regional) for the master planning 
and redevelopment of the former Howard Air Force Base site. 
Ferrer added that a Singaporean firm had already set up an 
aircraft maintenance and repair operation at Howard that 
would receive its first aircraft in May.  The Deputy 
Secretary suggested that a Singapore-Panama connection offers 
Panama an important "window to Asia."  Torrijos agreed and 
recounted growing Singapore-Panama ties, including a recent 
visit by Singapore's Prime Minister and growing bilateral 
cooperation on ports, energy, and telecommunications. 
 
OAS General Assembly: What does Hugo Want? 
------------------------------------------ 
 
¶8.  (SBU) Turning to the June 3-5 OASGA in Panama, the Deputy 
Secretary noted that Secretary Rice looked forward to 
participating.  Lewis said that the GOP was enthused about 
health-related activities planned in connection with the 
OASGA, such as the launch of a Regional Healthcare Worker 
Training Center (an HHS-GOP brainchild) and the OASGA's 
consideration of a "Health Agenda for the Americas." 
 
¶9.  (C) Torrijos added that Venezuelan President Hugo Chavez 
had indicated an interest in attending the OASGA.  Torrijos 
acknowledged that this would be a protocol and a political 
problem.  The OASGA is a ministerial-level assembly; aside 
from the host country, heads of government or state do not 
attend.  Also, Torrijos said he assumed that the purpose of 
Chavez's attendance would not be positive.  He noted, "I am 
not a psychiatrist, so I cannot figure out what Hugo is 
thinking;" but, "I am waiting to see what Hugo wants." 
Torrijos said he is planning a trip to Brazil in late May. 
If Chavez persists in his desire to attend the OASGA, 
Torrijos said, he would stop in Caracas on the way back from 
 
Brazil to try to dissuade him. 
 
¶10.  (U) This message was cleared by the Deputy Secretary's 
delegation. 
EATON