VZCZCXYZ0006
OO RUEHWEB

DE RUEHBU #1828/01 2561338
ZNR UUUUU ZZH
O 131338Z SEP 07
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9233
INFO RHMFISS/CDR USSOCOM MACDILL AFB FL//SCJ2//
RULGPUA/USCOMSOLANT

UNCLAS BUENOS AIRES 001828 
 
SIPDIS 
 
STATE FOR INR/R/MR, I/GWHA, WHA, WHA/PDA, WHA/BSC, 
WHA/EPSC 
CDR USSOCOM FOR J-2 IAD/LAMA 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: KPAO OPRC KMDR PREL
SUBJECT: MEDIA REACTION; CLASHES IN CHILE; SARKOZY'S COMMENTS ON 
ARGENTINA; IMPACT OF THE WORLD FINANCIAL CRISIS ON ARGENTINA; 
09/13/07 
 
 
¶1. SUMMARY STATEMENT 
 
The most important international stories include the murder of a 
Chilean police officer on the 34th anniversary of the coup d'etat 
against former Chilean President Salvador Allende; French President 
Nicolas Sarkozy warning Argentina and other emerging powers that 
they should further open their industries in exchange for a 
reduction in farm subsidies; and the allegedly negative impact of 
the world financial crisis on Argentina's economic performance. 
 
¶2. OPINION PIECES AND EDITORIALS 
 
- "Narcos impose terror on (Chilean) poor and marginal inhabitants" 
 
Msnica Gonzlez, international columnist of leading "Clarn," writes 
(09/13) "... Yesterday's (murder of a police officer) was the 
culmination of a confrontation among drug dealing gangs that took 
advantage of social protests and the commemoration of the day on 
which Chile buried its democracy in 1973 to strengthen their 
territorial domination. As happened in Brazilian 'favelas,' drug 
traffickers, which are embedded in the ring of poverty surrounding 
Santiago, want to impose their power on other gangs, so later, 
through violence,  keep police off their streets intending to win 
over the poor residents with fear and the carrot: distributing food 
and work for women and youth as small drug distributors. The terror 
of delinquents has today replaced the terror that Pinochet's secret 
squads imposed in the past... The police officer killed yesterday 
was victim of an ambush in which one patrol was hit by crossfire 
from three different directions. It is either the beginning of a 
second phase of power clashes among drug dealers or the rise of an 
extremist group seeking a place among the three million Chileans who 
make less than five hundred dollars per month." 
 
- "The French president criticizes Argentina" 
 
Luisa Corradini, columnist of daily-of-record "La Nacisn's" "Economy 
& Business" supplement, writes (09/13) "French President Nicolas 
Sarkozy warned Argentina and other emerging powers, such as Brazil, 
China and India, that they should accept 'the duties of powerful 
countries' if they want 'the same rights' as powerful countries. 
 
"He said: 'France demands reciprocity, France demands balance. 
France demands preferential treatment for the community.' Sarkozy 
warned that he would oppose every Doha Round agreement at the WTO 
that 'is against French interests.' In the framework of the Round, 
wealthy countries claim that developing countries should further 
open their industries to international competition in return for a 
reduction in agricultural protectionism (which consists of farm 
subsidies and import tariffs). 
 
"Sarkozy's statement... is particularly important because it is a 
turning point in French agricultural policy. He announced that 
during the EU French presidency in the second half of 2008, he would 
open a 'discussion' aimed at establishing a new Common Agricultural 
Policy (CAP). 
 
"... Sarkozy said he wants the upcoming common agricultural policy 
to be defined on the basis of 'an unquestionable principle of 
community preference.' This means that in the event the other 26 EU 
countries accept his opinion, Europe will reinforce its 
protectionist arsenal to promote its production." 
 
- "Gone with the wind" 
 
Business-financial "El Cronista" carries an opinion piece by Agustn 
¶A. Monteverde, an economist from M&A Inc., who writes "... At the 
first signs of a world financial crisis, many analysts maintained 
that (Argentina's) fiscal situation, trade surplus, reserves and 
relative isolation could protect the country. 
 
"Our assessment was that those supposed strong points are instead 
vulnerabilities. 
 
"... The fact that Argentine debt has been the most punished in the 
region during recent weeks revealed that the alleged strong points 
were an illusion.  The country's debt default, judicial insecurity, 
frozen prices, manipulated inflation rate... as well as its refusal 
to honor commitments to holdouts are factors that weigh negatively 
with investors. 
 
"In view of deteriorated fiscal conditions, and in light of 
historical experience, the people have again purchased dollars 
because they anticipate that the structural increase in public 
expenditures could be liquidated through a new devaluation. 
 
"Interest rates, the dollar value and the increasing inflation rate 
 
 
make up a menacing scenario for the country's public debt... And, if 
the bond slump is prolonged, the solvency of the financial system 
will be endangered - 30 percent of its portfolios are exposed to 
government risk." 
 
To see more Buenos Aires reporting, visit our 
classified website at: 
http://www.state.sqov.gov/p/wha/buenosaires 
 
WAYNE