VZCZCXYZ0025
RR RUEHWEB

DE RUEHZP #1424/01 2361809
ZNR UUUUU ZZH
R 241809Z AUG 07
FM AMEMBASSY PANAMA
TO RUEHC/SECSTATE WASHDC 1038
INFO RUEAIIA/CIA WASHDC
RHMFIUU/COMDT COGARD WASHINGTON DC
RULSDMK/DEPT OF TRANSPORTATION WASHDC
RHMFIUU/DEPT OF HOMELAND SECURITY WASHINGTON DC
RHEHAAA/WHITE HOUSE WASHDC
RUEKJCS/SECDEF WASHDC
RHMFISS/JOINT STAFF WASHINGTON DC
RUMIAAA/HQ USSOUTHCOM MIAMI FL

UNCLAS PANAMA 001424 
 
SIPDIS 
 
SIPDIS 
 
FOR STATE WHA/CEN - FEELEY AND TELLO 
FOR COAST GUARD - RDML SALERNO 
 
E.O. 12958: N/A 
TAGS: EWWT ECON ETRD PM
SUBJECT: U.S. COAST GUARD BILLET IN PANAMA CANAL TO END 
 
REF: A. (A) PANAMA 1305 
 
     ¶B. (B) CHARGE/FEELEY TELCON 
 
¶1. (U) SUMMARY. On August 17, 2007, Charge and EconOff told 
Panama Canal Authority (ACP) Administrator Alberto 
Aleman Zubieta that the USG cannot absorb the $60,000 in 
additional yearly costs to keep USCG billet embedded at the 
ACP under existing terms (Ref. A). Charge explained  that 
Post had conveyed to Washington Aleman Zubieta's desire to 
keep the billet at the existing cost to the ACP and that Post 
was informed that if the ACP wanted the billet, it had to 
absorb the additional costs (Ref. B). 
 
¶2. Aleman responded that he was left with no choice but to 
terminate the CG Billet as of September 30, 2007. (Comment: 
this would end ninety continuous years of direct U.S. 
involvement in Panama Canal Operations. End comment). Aleman 
added that the ACP's principal concern would be accessing the 
Coast Guard for assistance when necessary and finding a 
mechanism to give the Coast Guard ACP information.  US Coast 
Guard informed Post on August 20 that the CG Billet would be 
terminated as of September 30 but that the CG Billet officer 
would begin work to establish a framework to enable the ACP 
to access Coast Guard assistance regarding, among other 
things, security related matters and periodic training 
requests.  END SUMMARY. 
 
--------------------------------------------- ------ 
Post Delivers Message - No Reduction in Billet Cost 
--------------------------------------------- ------ 
 
¶2. (U) On August 17, 2007, Charge and EconOff met with 
Alberto Aleman Zubieta, Administrator for the Panama Canal 
Authority, to inform him that the Coast Guard was not 
prepared to lower the amount that the CG would have pay to 
keep the Coast Guard Billet (see Ref. A).  Charge further 
informed Aleman Zubieta that Coast Guard Rear Admiral Brian 
Salerno would be contacting Zubieta later August 17 to 
discuss the matter. 
 
--------------------------------- 
Aleman Disappointed and Concerned 
--------------------------------- 
 
¶3. (U)  Aleman said he was disappointed with the news. 
He said he could not agree to continue the CG Billet at 
$243,000 for FY 2008 and would have no choice but to 
terminate the CG Billet after its current termination date of 
September 30, 2007.  In addition to claiming budgetary 
constraints, Aleman Zubieta said continuation of the CG 
Billet at the higher cost would require a new contract and 
new Board of Directors approval.  He added that a new 
contract could not be negotiated, drafted and approved by 
September 30 and that he was unwilling to even undertake new 
contract negotiations. 
 
¶4. (U) Aleman said the ACP's principal concern would be 
accessing Coast Guard information and assistance when 
necessary.  He said keeping the CG Billet was his first 
option, but will know focus on "Alternative B".  He expressed 
a desire to maintain some sort of consulting relationship 
with the Coast Guard as part of his "Alternate B."  Charge 
encouraged Aleman to discuss with Salerno continued possible 
formal arrangements.  When asked about other Coast Guard 
resources at Post, Charge informed Aleman that the remaining 
Coast Guard officer at Post was dedicated almost exclusively 
to drug trafficking matters. 
 
----------------------------------- 
Official Termination and Next Steps 
----------------------------------- 
 
¶5. (U)  On August 20, 2007, the current CG Billet officer 
informed Post that the CG Billet will terminate on September 
30, 2007.  The CG Billet officer will be reassigned.  In the 
interim, he will begin work on a Memorandum of Understanding 
or other framework between the 
Coast Guard and the ACP to enable the ACP to access Coast 
Guard assistance regarding, among other things, security 
related matters and periodic training requests. 
 
------- 
COMMENT 
------- 
 
¶6.  (U)  Termination of the CG Billet marks the end of over 
90 years of official USG involvement in the Panama Canal. 
It is Post's understanding that the Coast Guard will work 
with the ACP to establish the necessary mechanisms to ensure 
ready and effective communication between the two agencies on 
all matters previously handled by the CG Billet officer. 
Post will assist, as necessary, the outgoing CG 
Billet officer and the Coast Guard with any transition 
matters.  Post will also explore other ways to strengthen 
USG-ACP ties to partially offset the void created by the CG 
Billet's demise. 
EATON