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DE RUEHZP #1831/01 3382053
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FM AMEMBASSY PANAMA
TO RUEHC/SECSTATE WASHDC 1504
INFO RUCPDOC/DEPT OF COMMERCE WASHDC

C O N F I D E N T I A L PANAMA 001831 
 
SIPDIS 
 
SIPDIS 
 
FOR STATE WHA/CEN - TELLO 
FOR STATE WHA/CCA 
 
E.O. 12958: DECL: 12/01/2014 
TAGS: ETRD ETTC PREL CU
SUBJECT: PANAMA/CUBA RELATIONSHIP: LIBERTAD ACT RESPONSE 
 
REF: A. STATE 158768 
 
     ¶B. PANAMA 834 
 
Classified By: Classified By: Econ Counselor Timothy Lattimer for Reaso 
ns 1.4(b)(d) 
 
¶1. (U) Post provides the following information in response to 
Ref. A request. Responses are keyed to the specific 
questions identified in Ref. A. Ref. B is Post's information 
covering the December 2006- May 2007 time period. Post's 
answers to 
REFTEL A questions are based on information obtained from the 
GOP's Comptroller General's offices, the GOP Ministry of 
Foreign Relations, the administrative offices of the Colon 
Free Zone, various industry and third country publications, 
and conversations with various Panamanian business executives. 
 
--------------------------------------- 
Nature of Panamanian Investments in Cuba 
---------------------------------------- 
 
¶2. (C) Question 1: What are the nature of investments (and 
names, if known) that host country businesses have in Cuba? 
 
¶3. (U) According to an investment study prepared by Spain's 
Society for Industrial Promotion and Reconversion (SPRI), of 
the 43 foreign companies operating in Cuba, six are 
Panamanian. 
 
¶4. (U) The SPRI study states that Panamanian companies 
participate in 18 cooperative production projects in Cuba, 
second only to Spain, which has 29 such projects. 
 
¶5. (U) Panama-based Copa Airlines maintains offices in Havana 
and has approximately 20 weekly non-stop flights from Panama 
City to Havana. On November 16, 2007, Copa Airlines announced 
that 
commencing in May 2008 it will increase its service to Havana 
to four daily non-stops (for a total of 28 flights per week). 
According to Panamanian business executives, Copa Airlines 
is the only major Panamanian company operating in Cuba. 
 
¶6. (U) According to the GOP's Ministry of Commerce and 
Industry (MICI), Panamanian exports to Cuba declined from a 
high of $4.3 million in 1998 to $469,590 in 2005. Panamanian 
exports to Cuba rebounded during 2006, totaling $1.0 million. 
During the first six months of 2007, Panama exported $1.4 
million 
worth of goods to Cuba; of which $920,000 was paper and 
cardboard 
products.  During all of 2006, Panama exported only $152,300 
worth of paper and cardboard products to Cuba. Other exports 
to 
Cuba are cosmetics, beauty supplies, juices, vegetable 
extracts, 
and aluminum. 
 
¶7. (U) According to MICI, Cuban exports to Panama have ranged 
from a high of $1,151,673 in 2000 to a low of $142,877 in 
¶2002. However, during 2006 Cuban exports to Panama jumped to 
$20.7 million; of which $19.9 million was clinker (the 
principal ingredient in most cement products), principally 
for use in Panama's booming construction industry.  During the 
first six months of 2007, Cuba exported $12.2 million worth of 
goods to Panama; of which $11.8 million was clinker.. 
 
¶8. (SBU) The bulk of Panamanian/Cuban commerce occurs through 
Panama's Colon Free Zone (CFZ). According to the 
Administrative 
Office of the CFZ, of the approximately 2,400 companies 
operating 
in the CFZ, approximately 95 do business with Cuba. Cuban 
companies 
and Panamanian shell companies owned by Cubans or the GOC use 
the 
CFZ as a transit point to import U.S. and other goods to Cuba 
to circumvent the U.S. trade embargo. As of 2004 (the most 
recent data available), Cuban companies owed various 
companies in the CFZ approximately $200 million for goods 
previously delivered. According to the CFZ, approximately, 
$195 million of goods were re-exported to Cuba during 2004. 
 
¶9. (U) The GOP does not compile statistics on the amount of 
foreign direct investment made by Panamanian companies in 
other countries. 
 
-------------------------- 
Bilateral Trade Agreements 
-------------------------- 

¶10. (C) Question 2: Are there bilateral trade agreements 
between the host country and Cuba? 
 
¶11. (U) On January 27, 1999, the GOP, under then-President 
Ernesto Perez Balladares' Administration, and GOC signed an 
Agreement for the Reciprocal Promotion and Protection of 
Investments that, among other things, guaranteed that each 
country would grant the other investment protections and 
rights no less than those received by any other third country. 
 
¶12. (U) On August 31, 2000, the GOP, under then-President 
Mireya Moscoso's Administration, and GOC signed an Agreement 
Relating to Airlines Services between their Respective 
Territories and Onward Destinations. 
 
¶13. (U) On November 5, 2007, under current President Martin 
Torrijos, the GOP and GOC signed two transportation 
agreements. 
One agreement increased the number of commercial flights 
between 
Panama and Cuba (see paragraph 5). The other was a maritime 
agreement providing for information exchange, marketing 
studies, 
training, employment exchange and modernization. 
 
----------------- 
Exchange Programs 
----------------- 
 
¶14. (C) Question 3: Are there any exchange programs between 
host country and Cuba, including but not limited to: 
scholarships for host country national to study in Cuba; 
Cuban-paid medical travel for host country nationals; and 
Cuban doctors working in host country? 
 
¶15. (U) On February 16, 1999, the GOP, under the Perez 
Balladares 
Administration, and the GOC signed an Agreement for Cultural 
and 
Educational Cooperation. 
 
¶16. (U) On March 17, 2006, the GOP, under current President 
Martin Torrijos' Administration, and the GOC signed a 
Memorandum 
of Understanding eliminating the need for visas to travel 
between Panama and Cuba for persons holding diplomatic, 
official, consular or special passports. The Memorandum of 
Understanding stated that the purpose of eliminating the visa 
requirement was to facilitate travel and exchanges between 
officials of both countries in order to contribute to an 
expansion in bilateral cooperation. 
 
¶17. (U) The GOP actively supports the GOC's Operation Miracle 
(Operacion Milagro) eye surgery program. According to the 
GOP, approximately 15,000 Panamanians have been treated by 
Cuban doctors in Panama and in Cuba. The GOC sponsors both 
free travel to Cuba and free eye care. Operation Miracle has 
received the active personal support of First Lady Vivian 
Fernandez 
de Torrijos, who has traveled to the airport to visit 
Panamanians departing for Cuba. The First Lady, along with 
GOP Vice Minister of Health Dora Jara, has supervised 
and coordinated all Operation Miracle activities. The GOC has 
two eye doctors working in Panama on a rotating basis. These 
doctors perform pre-screening of Operation Miracle patients 
at GOP health facilities. Both GOP and GOC officials 
frequently discuss expanding the reach of Operation Miracle 
in Panama. The GOP praised Operation Miracle, in presidential 
speeches (including President Torrijos' annual September 1 
"state of Panama" speech), by sponsoring full-page newspaper 
ads extolling 
the virtues of Operation Miracle, and on the websites of its 
various government agencies. The GOP listed Operation 
Miracle as one of the Torrijos Administration 's greatest 
accomplishments in a full-page GOP-paid ad regarding its 
social development achievements. On March 2, 2007, GOP FM 
Samuel Lewis Navarro and GOC FM Felipe Perez visited the 
jointly-operated Panamanian-Cuban Eye Surgery Treatment Center 
in Veraguas, Panama to highlight the work of Operation 
Miracle. 
 
¶18. (U) Panama and Cuba have student exchange programs. There 
are currently approximately 400 Panamanian medical students 
at the Latin American School of Medicine in Cuba. 
 
¶19. (U) On November 5, 2007, Cuban FM Felipe Peres 
Roque promised to send 100 Cuban sport trainers to Panama 
between January and March, 2008.  See paragraph 24. 
 
¶20. (U) The GOC also provides the GOP with a literacy program 
in Panama called "Si Yo Puedo" (Yes I Can). 
 
--------------------------------------- 
Promotion of Democracy and Human Rights 
--------------------------------------- 
 
¶21. (C) Question 4: Has the host country, in Post's opinion, 
worked to promote the advancement of democracy and human 
rights in Cuba? This can include: public statements or other 
governmental actions, such as resolutions in the national 
assemblies condemning human rights abuses in Cuba; statements 
in support of democracy following the July 31, 2006 handover 
of power from Fidel to Raul Castro; actions in support of 
civil society in Cuba through host country's diplomatic 
missions or other fora. 
 
¶22. (C) The GOP has not made any public statements in support 
of democracy or human rights in Cuba during 2007. The GOP 
appears to have done little to support the advancement of 
democracy or human rights in Cuba. The GOP is strengthening 
its relationship with Cuba through increased 
government-to-government contact and through exchange 
programs such as Operation Miracle. The GOP does not support 
any proactive steps to further democracy upon President 
Castro's death or as a result of the transfer of power to 
Raul Castro. While it claims to press the GOC in private to 
facilitate democracy on the island, the GOP in its 
conversations with USG officials emphasizes the need for 
stability in Cuba and downplays encouraging democracy. The 
GOP, however, advocates lifting the USG trade embargo on 
Cuba. 
 
----------------- 
Diplomatic Visits 
----------------- 
 
¶23. (C) Question 5: Have there been any high-level diplomatic 
visits between Cuba and host country in the past six months? 
 
¶24. (U) On November 4- 5, 2007, GOP First Vice President and 
Foreign Minister Sameul Lewis Navarro lead the GOP delegation 
to 
the XXV International Fair of Havana.  GOP officials included 
Fernando 
Soloranzo, Administrator of the Panamanian Maritime Authority 
and 
Carmen Gislea Vergara, Vice Minister of the Ministry of 
Commerce and 
Industry.  Navarro and Cuban Vice President Carlos Lage 
inaugurated 
the fair.  Navarro also met with Cuban Chancellor Peres Roque. 
ARREAGA