VZCZCXYZ0001
OO RUEHWEB

DE RUEHBU #0686/01 1622049
ZNR UUUUU ZZH
O 112049Z JUN 09
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC IMMEDIATE 3859
RUEHC/DEPT OF LABOR WASHINGTON DC IMMEDIATE
RUEHGV/USMISSION GENEVA 0765
INFO RUCNMER/MERCOSUR COLLECTIVE

UNCLAS BUENOS AIRES 000686 
 
DOL FOR ILAB CHANTENIA GAY 
DEPT FOR DRL/ILCSR MARK MITTELHAUSER 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ELAB KTIP SOCI AR
SUBJECT: ARGENTINA: INPUT FOR LABOR SECRETARY SOLIS MEETING IN 
GENEVA WITH ARGENTINE PRESIDENT FERNANDEZ DE KIRCHNER 
 
REF: (A) 06/11/09 Gay-Gomez e-mail and telcon(B) BUENOS AIRES 0445 
 
¶1.  THIS CABLE IS SENSITIVE BUT UNCLASSIFIED.  NOT FOR INTERNET 
DISTRIBUTION. 
 
¶2. (SBU) Summary and Introduction:  Labor Secretary Solis' upcoming 
June 15 meeting with Argentine President Cristina Fernandez de 
Kirchner (CFK) represents an opportunity to assure the Argentine 
government (GOA) that we value the bilateral relationship and that 
we hope to intensify bilateral and regional cooperation to turn 
around the global crisis and work together to build hemispheric 
prosperity and security.  Post offers the following overview (paras 
3-7) and talking points (paras 8-13) to assist the Department of 
Labor's preparations for the upcoming meeting which will take place 
on the margins of the International Labor Organization (ILO) Summit 
on the Global Jobs Crisis in Geneva, Switzerland.  End Summary and 
Introduction. 
 
Political Overview 
------------------ 
 
¶3. (SBU) President Cristina Fernandez de Kirchner (CFK) continues to 
face an uphill battle with the Argentine public and international 
financial markets in the face of a cooling Argentine economy, 
continued strife with the popular farming sector, and increasing 
public concerns over crime and security.  Mid-term congressional 
elections are June 28 and CFK's husband, former President Nestor 
Kirchner is a candidate.  The election is seen by many as a vote of 
confidence in the Kirchner administration, and the Kirchners will 
likely lose control over the lower house of Congress.  CFK is avidly 
seeking to associate herself with President Obama, who is highly 
popular in Argentina, and the GOA has repeatedly requested a 
bilateral meeting between the heads of state.  She may be interested 
in gauging U.S. support for her proposal to have the G-20 give a 
seat to the International Labor Organization.  Your meeting with CFK 
represents an opportunity to assure the GOA that we are committed to 
strengthening the bilateral relationship and that we hope to 
intensify cooperation to turn around the global crisis and work 
together to build hemispheric prosperity and security. 
 
Labor Overview 
-------------- 
 
¶4. (SBU) CFK is the latest member of the Justicialist (Peronist) 
party to rule Argentina.  Peronism is a labor-based movement that 
has given labor unions more power and negotiating leverage in 
Argentina than they enjoy in perhaps any other Latin American 
country.  This has entailed costs as well -- Argentina's inflexible 
labor regulations hinder employment creation and productivity 
growth.  Despite some government efforts to reform labor 
regulations, barriers to flexibility linger in the form of non-wage 
costs.  The non-salary cost of employing a worker is high, and 
dismissing a redundant employee can be costly. 
 
¶5. (SBU) Argentina's population is more than 40 million, with more 
than 16.27 million in the labor force(76% of the labor force is 
currently employed in the services sector; 23% in industry, and 1% 
in agriculture).  In late 2008, the government raised the monthly 
national minimum wage to 1,240 pesos (US$335).  Most workers in the 
formal sector earned significantly more than the minimum wage.  The 
maximum workday is eight hours, and the maximum workweek is 48 
hours.  According to the Ministry of Labor, approximately 40 percent 
of the urban workforce is employed in the informal sector.  The 
Ministry of Labor, which is responsible for enforcing legislation 
related to working conditions, increased inspections to get 
companies to register their informal workers. 
 
¶6. (SBU) According to official GoA statistics, poverty levels 
continued to fall in the second half of 2008, reaching 15.3% of the 
urban Argentine population (with extreme poverty declining to 4.4%). 
 However, doubts about the validity of Argentina's official 
statistics have led many analysts and social activists to question 
official poverty figures.  A number of private analysts calculate 
poverty above 30%.  They argue that the GoA's deliberate 
underestimation of the level of poverty allows it to claim that it 
has doubled social spending for the poor and reduced poverty, when 
in fact per capita social spending has declined in real terms and 
poverty appears to be rising after a few years of decline earlier in 
the decade. 
 
¶7. (SBU) The ILO reports that Argentina currently has more than 
2,800 trade union organizations.  An estimated 35 percent of the 
workforce is organized in unions, and approximately 75 percent of 
the formal sector workforce is covered by collective bargaining 
agreements.  The largest national union organization is the General 
Confederation of Workers (CGT), which accounts for about 80% of 
 
unionized workers.  The CGT's secretary general, Hugo Moyano is 
closely aligned with Cristina Fernandez de Kirchner, and is a Vice 
President of the Peronist Party.  The next largest union 
organization is the Central of Argentine Workers (CTA), although it 
does not have full legal standing on par with the CGT.  Both 
organizations are active participants in the ILO. 
 
Suggested Talking Points 
------------------------ 
 
¶8. (SBU) Enhanced Cooperation:  Argentina is playing an important 
role on a number of issues that are important to the Obama 
administration, including job creation, poverty alleviation, and 
social inclusion.  President Obama looks forward to deepening the 
dialogue between our two governments and working in partnership in 
these and other areas of common interest. 
 
¶9. (SBU) Economic Crisis:  How has the global economic crisis 
affected Argentina?  What measures have your government taken to 
lessen the impact on Argentine workers and the most vulnerable? 
 
¶10. (SBU) USG Labor Cooperation:  We have been pleased to work with 
the Ministry of Labor to share U.S. corporations' best practices on 
corporate social responsibility and organize annual digital video 
conferences on with the Federal Mediation and Conciliation Service 
on labor conflict resolution and prevention.  And we are looking 
forward to working with your government trough the OAS 
Inter-American Network for Labor Administration on the issue of 
youth employment programs, targeting the most vulnerable youth. 
 
¶11. (SBU) Forced/Child Labor:  Forced and child labor is a problem 
that all countries face, including the United States, and we must 
work together to eradicate it.  The Argentine Ministry of Labor's 
initiative to develop a Corporate Network for the Eradication of 
Child Labor as well as its joint program with the Ministry of 
Education to provide scholarships to reintegrate children who have 
dropped out of school to work are both excellent practices.  What 
can we do to assist these noteworthy efforts? 
 
¶12. (SBU) IF RAISED:  DOL Research Grant to Verite on Forced/Child 
labor:  I understand your concerns.  The Department of Labor 
conducts research and commissions studies all over the world to 
inform and formulate international economic, trade and labor 
policies in collaboration with other U.S. government agencies. 
Argentina was selected for inclusion in this particular research 
study because of recent news reports from the Argentine press about 
forced labor, particularly in the garment industry.  Research helps 
the international community identify problem areas, develop 
programs, and adopt policies to better address the issue. 
 
Background:  The Argentine government is extremely sensitive to any 
public reporting that may be construed as criticism.  In May, the 
Argentine Embassy met with State Department officials to protest 
USDOL's decision to award a $1.25 million grant to Verite, a 
non-profit non-governmental organization, to research forced labor 
in eight countries:  Argentina, Bangladesh, Bolivia, China, the 
Dominican Republic, Indonesia, Liberia, and the Philippines. 
Department officials informed them that the report was for research 
purposes only and not an accusation that forced labor is a problem 
in Argentina. 
 
¶13. (SBU) IF RAISED:  Meeting with President Obama:  I will pass on 
your interest in meeting with President Obama to the White House. 
It may take time, given the numerous challenges the President 
currently faces.  However, he has expressed a strong interest in 
working closely with our partners in the hemisphere, and we very 
much value our partnership with Argentina. 
 
KELLY