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DE RUEHMU #1275/01 2941908
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FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 3275
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RHEHNSC/NSC WASHINGTON DC PRIORITY
RHEFDIA/DIA WASHINGTON DC PRIORITY
RUMIAAA/CDR USSOUTHCOM MIAMI FL PRIORITY
RUEHLMC/MILLENNIUM CHALLENGE CORP WASHDC PRIORITY

C O N F I D E N T I A L SECTION 01 OF 02 MANAGUA 001275 
 
SIPDIS 
 
STATE FOR WHA/CEN, OFM, DRL 
NSC 
 
E.O. 12958: DECL: 10/16/2018 
TAGS: PREL PHUM AMGT KREC NU
SUBJECT: AMBASSADOR MEETS WITH SANTOS ON BILATERAL ISSUES 
AND DEMOCRACY CONCERNS 
 
REF: MANAGUA 1183 
 
Classified By: Ambassador Robert J. Callahan, reasons 1.4 (b) and (d) 
 
¶1. (C) On October 13, Ambassador met with Foreign Minister 
Samuel Santos to express concern over a series of GON actions 
that appear to be targeted at the Embassy, including 
continued refusal to issue a tax exemption letter for 
gasoline taxes and a new rule that revoked airport access 
badges.  Santos replied that the Foreign Ministry (MINREX) is 
studying the tax issue and reported that he had spoken with 
the Finance Minister to seek a resolution.  On the airport 
badges, Santos agreed to seek additional passes for the 
Embassy, but noted that the final decision is in the hands of 
the Airport Administration.  Ambassador also expressed 
concern over the harassment of civil society, especially the 
International Republican Institute (IRI) and the Prosecutor's 
Office's request for IRI's financial records for the last 
five years.  Santos presented a letter from the Prosecutor 
granting a two week delay in IRI's case, but emphasized that 
IRI had violated its agreement with MINREX and Nicaraguan law 
in its "partisan" activities.  He further asserted that the 
Embassy continued to fund groups seeking to undermine the 
Ortega government.  When pressed on the Ortega Government's 
view on what is democracy, Santos retorted that democracy 
means "compliance with the law," an ominous note for the 
future of Nicaraguan civil society.  End Summary. 
 
TREATMENT OF U.S. EMBASSY -- GASOLINE TAX AND AIRPORT BADGES 
--------------------------------------------- --------------- 
 
¶2. (C) Ambassador expressed concern that the continued 
anti-American rhetoric, Santos' implicit support in his UNGA 
speech for the independence of Puerto Rico, attacks on NGOs 
and new obstacles to the Embassy's ability to conduct its 
daily operations reinforce the view that there is a policy of 
hostility by the Ortega administration towards the USG.  It 
remains the USG's desire to avoid conflicts with the GON and 
to resolve differences amicably, yet the GON's words and 
actions are making that effort more difficult. 
 
¶3. (C) Ambassador raised the Nicaraguan Government's 
continued refusal to provide an exoneration letter to Chevron 
exempting the Embassy of payment of taxes for gasoline 
purchases.  The continued failure of the GON to comply with 
its Vienna Convention requirements could cost the Embassy an 
estimated USD 40,000 per year.  In addition, Chevron is 
seeking payment of back taxes, under pressure from the 
Ministry of Finance, for the last ten years worth 
approximately USD 300,000.  Ambassador emphasized that the 
GON's obligations are clear and that Nicaraguan diplomats in 
the U.S. would be treated on a reciprocal basis if the 
exoneration is not provided in a timely manner.  Santos 
replied that he is aware of the issue and has raised it with 
the Finance Minister.  MINREX is studying this issue in 
further detail, but noted that the issue is complicated 
because only the U.S. Embassy is seeking exoneration from the 
gasoline tax. 
 
¶4. (C) Ambassador also called Santos' attention to a recent 
change in procedure by Managua airport authorities to cancel 
all existing airport security passes and, after nearly a 
month's delay, the issuance of a new ruling that permits only 
three passes per mission to be obtained on a daily basis. 
The new rule only permits use of the day badges for picking 
up diplomatic pouches.  The effect of this new rule will be 
borne disproportionately by the U.S. Embassy, as we have the 
largest mission and therefore need more than three badges. 
Further, limiting their use to the diplomatic pouch only 
could inhibit our ability to facilitate military and 
humanitarian cooperation, a planned upgrade of the airport 
security camera system, and prohibit our ability to enter the 
airport to facilitate visits by officials.  Santos responded 
that he was aware of the change and understood the Embassy's 
concerns and the impact the new rule could have.  As the new 
rule was an administrative matter and did not involve a law, 
he reported it might be possible to obtain more passes for 
the Embassy and promised to look into the issue further. 
(Note: Embassy will submit a formal request via diplomatic 
note requesting additional passes for the Embassy.  End Note.) 
 
FSLN VIEW OF DEMOCRACY -- COMPLIANCE WITH THE LAW 
--------------------------------------------- ---- 

¶5. (C) Turning to the GON's ongoing campaign against civil 
society, Ambassador expressed our deep concern about the 
treatment the resident director of the International 
Republican Institute (IRI) had received when he appeared 
before the Prosecutor on October 10 and was ordered to 
present the past five years of IRI's financial records by 
October 13 or face arrest on contempt of court charges.  The 
cumulative effect of these actions against NGOs has been to 
create a climate of fear and will likely draw further 
negative attention from the international community.  Santos 
proudly announced that, in response to the Ambassador's 
earlier request, the Prosecutor's Office had granted a two 
week delay in IRI's case, to allow them additional time to 
collect the requested documents.  However, he asserted that 
IRI had violated its agreement with MINREX by inviting 
speakers, including former Mexican President Fox, without 
advance notice to MINREX and in pursuing unspecified 
"partisan" activities.  Santos complained that the U.S., at 
one level, wants to talk with and engagethe GON while quietly 
"financing groups that seek to destabilize" the government. 
 
¶6. (C) When pressed for what the FSLN's view of democracy and 
the role of civil society is, Santos replied democracy means 
"compliance with the law."  The Ortega government, he 
explained, is in the "process of making the country comply 
with the law."  Previous governments had not applied the law 
and "abuses" were made by NGOs and government officials.  Now 
the FSLN will bring order to the country.  The NGOs that are 
facing hearings, such as Carlos Fernando Chamorro's Center 
for Investigations and Communiactions (CINCO) and Sofia 
Montenegro's Autonomous Women's Movement (MAM), failed to 
present their financial records, are in violation of the law, 
and are "in clear rebellion." We will give civil society 
space, he warned, but there must be clarity in the source and 
use of funding and respect for the law.  In conclusion, he 
added, it is impossible to talk of democracy in Nicaragua 
"when a majority of the country is ignorant," referring to 
Nicaragua's high illiteracy and poverty rates.  Ambassador 
responded that there are many examples of countries with 
poverty and development challenges that have strong 
democracies as well as countries with nearly 100 percent 
literacy, such as Honecker's East Germany (whose widow was 
the national Order of Ruben Dario award in July in 
recognition of her husband's support for the Nicaraguan 
people), Ceaucescu's Romania and Castro's Cuba that were 
ruled by some of the world's most ruthless dictators. 
Ambassador emphasized that there must be space for civil 
society, that the USG would remain transparent in our use of 
funding to support civil society, and that the international 
community will watch to see whether the law is applied 
impartially. 
 
COMMENT 
------- 
 
¶7. (C) The Nicaraguan Government continues to assert that it 
is simply applying "the law" in its ongoing campaign of 
harassment of civil society, opposition political parties, 
and even the Embassy's daily operations.  We have emphasized 
in our response to the GON that it is the interpretation and 
selective application of the the law that is most worrisome 
to the international community.  It is clear that the law is 
not applied impartially but rather remains a tool to be used 
at the Ortega government's convenience to excuse its actions 
or repress its foes.  We will continue to press the GON on 
both the gasoline tax and airport badge issues but expect 
more problems like these to surface in the future. 
CALLAHAN