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RR RUEHWEB

DE RUEHZP #1065/01 1732108
ZNR UUUUU ZZH
R 222108Z JUN 07
FM AMEMBASSY PANAMA
TO RUEHC/SECSTATE WASHDC 0676
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUEHBO/AMEMBASSY BOGOTA 2598
RUEHPE/AMEMBASSY LIMA 0697
RUEATRS/DEPT OF TREASURY WASHDC
RHEHAAA/NSC WASHDC
RUEHRC/DEPT OF AGRICULTURE WASHDC
RUEAIIA/CIA WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RHEFDIA/DIA WASHDC
RUEHC/DEPT OF LABOR WASHDC
RHMFISS/CDR USSOUTHCOM MIAMI FL
RUEKJCS/OSD WASHDC
RHMFISS/JOINT STAFF WASHINGTON DC

UNCLAS PANAMA 001065 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR WHA/CEN TELLO 
STATE FOR DRL RIGG 
STATE PASS USTR & WHA/EPSC 
USTR FOR VERONEU, EISSENSTAT & SHIGETOM 
 
E.O. 12958: N/A 
TAGS: ETRD ECON ELAB PM
SUBJECT: TOP PANAMANIAN LABOR COUNCIL ENDORSES TPA 
 
¶1. SUMMARY. Panama's top labor council reversed course and 
voted to endorse the U.S.-Panama Trade Promotion Agreement 
(TPA) on June 21, 2007. The Executive Council of the National 
Council of Organized Labor (CONATO) voted 4 to 3 to support 
the TPA, reversing its earlier opposition in what CONATO 
coordinator Marcos Allen described as a "difficult, but 
productive and democratic process."  GOP chief trade 
negotiator Leroy Sheffer said the vote was a significant win 
for the GOP.  END SUMMARY. 
 
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Big Win for GOP: Labor Council Endorses TPA 
------------------------------------------- 
 
¶2. (U) On June 21, 2007, CONATO announced that a majority of 
its Executive Council, by a 4 to 3 vote, agreed to support 
the TPA.  The vote was a reversal of CONATO's prior anti-TPA 
position. 
 
¶3. (SBU) CONATO's vote came after a series of meetings over 
the past two weeks with GOP trade and labor ministry 
officials and private sector leaders, culminating on June 21 
with a debate among union representatives and CONATO 
officials.  Allen told EconCouns that the debate leading up 
to the vote was a "difficult, but productive and democratic 
process."  Each Executive Council member was given two hours 
to present their position.  Allen told EconCouns that the 
change in position resulted because TPA proponents were able 
to negate "lies and myths" TPA opponents had promulgated over 
the years.  Allen also said TPA proponents focused on the 
win-win nature of the TPA.  Allen said he expected some TPA 
opponents would still publicly opposed the TPA but would have 
no basis to complain about the fairness of the CONATO vote or 
to claim that a majority of its members oppose the TPA.  For 
example, Juan Jovane, former director of the GOP's Social 
Security System and a highly-regarded advisor to CONATO, 
argued against the TPA and would likely continue to do so. 
Scheffer told EconCouns that the meetings were "intense" and 
the vote was a significant win for the GOP. 
 
¶4. (U)  During the meeting, GOP's Minister of Employment and 
Labor Development, Reynaldo Rivera, told CONATO officials 
that while labor would naturally be worried about worker 
rights, "the government of (President) Martin Torrijos will 
make no changes to the existing labor code." 
 
¶5. (U)  Among the arguments opposing the TPA were false 
claims by Jovane that the TPA would endanger Panamanian food 
safety regulations and that the TPA would give the U.S. 
preferential rights to obtain contracts for the Panama Canal 
expansion.  While the food safety issue has been a 
long-standing argument against the TPA, the final negotiating 
round produce a resolution to the issue which include the 
creation of a new Panamanian Food Safety Authority.  The TPA, 
in reality, only stipulates that U.S. will be able to bid on 
Canal expansion contracts on the same terms as other bidders. 
 
 
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What is CONATO? 
--------------- 
 
¶6. (U) CONATO is a federation of approximately 250 Panamanian 
labor unions.  These unions represent workers in various 
industries, such as agriculture, services, manufacturing, 
retail and wholesale commerce and transportation. Allen and 
other CONATO TPA proponents are expected to attend the TPA 
signing in Washington, D.C. on June 28, 2007. 
 
--------------------------------------------- 
Radical, Outspoken Union Continues Opposition 
--------------------------------------------- 
 
¶7. (U) National Union of Workers Construction and Similar 
Industries (SUNTRACS), which is not part of CONATO, continues 
to oppose the TPA.  SUNTRACS is the leader union within the 
Coordinator of Union Unity (CONUSI).  SUNTRACS, primarily a 
construction workers union, consists of approximately 40,000 
official members and claims to represent over 200,000 
workers.  SUNTRACS has held numerous protests against other 
GOP initiatives, including Social Security System reforms and 
the Panama Canal expansion project.  In 2005, CONATO expelled 
CONUSI, along with SUNTRACS, over a differences with 
SUNTRACS' more confrontational negotiating tactics.  In the 
wake of several losses, however, SUNTRACS is returning to 
bread and butter construction union issues, most notably a 
campaign calling for enforcement of construction labor safety 
norms. 
 
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Comment 
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¶8. (U) COMMENT.  While passage of the TPA in the Panamanian 
Assembly is widely expected, the CONATO vote is a major 
victory for the GOP in winning broad-based support for the 
TPA.  The GOP has worked hard to include business and labor 
in the TPA negotiation process in order to win their support. 
 The CONATO vote should bolster the standing of MICI Minister 
Alejandro "Andy" Ferrer and adds considerable wind to the 
GOP's sails heading into the June 28 signing. END COMMENT. 
EATON