VZCZCXYZ0000
RR RUEHWEB

DE RUEHMU #0711/01 1982016
ZNR UUUUU ZZH
R 172016Z JUL 09
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC 4358
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUEAHLC/HOMELAND SECURITY CENTER WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC

UNCLAS MANAGUA 000711 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EEB/TRA 
STATE PASS USDOT 
HOMELAND SECURITY PASS TSA 
 
E.O. 12958: N/A 
TAGS: ECON EAIR ETRD NU
SUBJECT: NICARAGUA: CIVIL AVIATION UPDATE 
 
REF: MANAGUA 1448 
 
¶1. (SBU) Summary.  Representatives of airlines that fly from 
Nicaragua to the United States met at the Embassy on July 9 
for the Deputy Chief of Mission's quarterly Civil Aviation 
Roundtable.  Continental, Delta, and TACA airlines attended, 
and they described worsening relations with the Nicaraguan 
airport authority in areas ranging from personnel to 
security.  The Government of Nicaragua has increasingly 
consolidated airport services under its airport authority, 
the Empresa Administradora de Aeropuertos Internacionales 
(EAAI), which is run by Orlando Castillo, a loyalist of 
President Daniel Ortega.  Embassy access to the airport 
remains restricted, and the airport administration recently 
cancelled its contract with an independent ground handlers' 
association, firing the managers and taking over airport 
ground handling operations itself.  The number of passengers 
flying to Nicaragua has remained largely stable in 2009. 
Northbound cargo shipments have declined, however, reflecting 
decreasing exports from Nicaragua to North America.  End 
Summary. 
 
AIRLINE AUTHORITIES LESS COOPERATIVE 
------------------------------------ 
 
¶2. (SBU) On July 9, representatives of Continental, Delta, 
and TACA airlines told the DCM at his quarterly Civil 
Aviation Roundtable that while the visible level of security 
provided by civilian and military authorities at Managua's 
Sandino International Airport remains consistent, the airport 
administration is no longer cooperative or transparent in its 
dealings with the airlines.  The airline reps said that the 
airport authority recently stopped providing the airlines 
with the training records of newly hired employees as they 
are required to do by contract.  Continental's representative 
added that the EAAI is hiring new people (to handle the 
baggage x-ray machines, for example) who are insufficiently 
trained and lack customer service skills.  Issues with 
baggage and cargo theft have subsided, but the airlines 
reported that airport authorities have all but stopped 
cooperating with them on theft investigations. 
 
¶3. (SBU) The Government of Nicaragua has increasingly 
consolidated airport administration and security under the 
EAAI, which is run by Orlando Castillo, a loyalist of 
President Daniel Ortega.  The U.S. airlines have access to 
Castillo, but they say that he rarely addresses their 
complaints and as a result they effectively have no one to 
complain to.  One airline rep described his company's current 
position in Nicaragua this way:  "Were going to keep flying," 
he said, "but we're suffering." 
 
EMBASSY ACCESS TO AIRPORT REMAINS RESTRICTED 
-------------------------------------------- 
 
¶4. (SBU) The airport authority has not relaxed its 
restrictions on Embassy access to the airport, implemented in 
¶2008.  We are limited to day passes for diplomatic pouch runs 
only, and only with 48-hour written advanced notice.  The 
Embassy, including the Regional Security Office, has no other 
access to the airport.  In the case of the arrival of a 
high-level USG visitor, limited additional passes would only 
be issued after receipt of a diplomatic note.  The airport 
authority has also attempted to restrict media access to the 
airport.  During the early days of the H1N1 swine flu 
epidemic, the EAAI told the airlines to speak only to Channel 
4, the quasi-official TV news outlet of the governing 
Sandinista National Liberation Front (FSLN). 
 
GROUND HANDLER CONTRACT ABRUPTLY TERMINATED 
------------------------------------------- 
 
¶5. (SBU) On May 21, 2009, the Nicaraguan Civil Aviation 
authority (INAC - Instituto Nacional de Aviation Civil) 
abruptly expelled the airport's ground handlers' association, 
Ground Handling Air Service Nicaragua S.A. (GHANSA), from 
their airport offices and cancelled their contract.  INAC's 
decision to terminate GHANSA's contract and fire its managers 
was met with strong resistance from the ground handlers, who 
have waged a battle with the GON in the media and have asked 
for Embassy support.  GHANSA claims that the government's 
actions were illegal under the terms of its 10-year contract, 
and that the airport has kept some ground handling equipment 
belonging to GHANSA. 
 
¶6. (U) INAC revoked GHANSA's operation certificate for what 
it called an "evident lack of operational security," basing 
its decision on a series of incidents for which it faults 
GHANSA. GHANSA admits to several incidents with ground 
handling equipment that resulted in damage to aircraft, but 
it attributes them to operator error.  During a meeting with 
Econoff, GHANSA pointed out that the operator of a sanitation 
truck that collided with a parked American Airlines jet has 
been retained by the airport authority while only GHANSA 
managers were fired.  GHANSA contends that International 
Civil Aviation Organization (ICAO) regulations call for a 
ground handler's organization that is independent of the 
airport regulatory authority.  In addition to illegally 
cancelling its contract, GHANSA claims that the airport 
authority is now using insufficiently trained personnel, 
thereby putting the security of airport operations at risk. 
The organization has complained in writing to the ICAO and 
the Federal Aviation Administration, in addition to the 
Embassy. 
 
¶7. (U) Following GHANSA's dismissal, the airport authority 
took over ground handling operations at the airport and 
rehired up to 60% of GHANSA employees to operate the ground 
handling equipment.  Prior to the creation of GHANSA in 2004, 
ground handling at Managua's international airport had been 
handled by the airport authority.  During the DCM's airline 
roundtable, the representatives of the major U.S. airlines 
said that ground handling operations at the airport had not 
suffered significantly, primarily because most of the 
experienced equipment operators were rehired by the airport. 
Management of the ground handlers is getting worse, however, 
because all of GHANSA's managers were fired and replaced with 
new staff. 
 
PASSENGER, CARGO TRAFFIC DOWN 
----------------------------- 
 
¶8. (U) The number of passengers flying to and from Nicaragua 
in 2009 is largely unchanged in comparison to 2008.  From 
2005 to 2008, however, passenger numbers averaged an annual 
8% increase.  The airlines report that they are seeing fewer 
overbooked flights than last year, but are still able to fill 
their planes.  Through June, air cargo exports from Nicaragua 
are down by 8% from the same period in 2008.  The airlines 
pointed to a decrease in northbound cargo shipments, 
reflecting decreased exports of specific items from Nicaragua 
to North America.  Items typically exported to the U.S. 
include articles from the maquila enterprises, as well as 
foodstuffs such as fruits, vegetables, and lobster.  Despite 
volume decreases linked to the global economic crisis, the 
airlines reported that their business in Nicaragua remains 
profitable. 
 
COMMENT 
------- 
 
¶9. (SBU) While Post is concerned about the lack of access and 
transparency in security operations at the airport, the 
airlines are not at this time reporting specific concerns 
over their operational security.  Post's working relationship 
with airport and civil aviation authorities is less 
cooperative in 2009 than in 2008, but it is still functional. 
 Diplomatic notes are generally required where once faxes 
would suffice.  For the major U.S. airlines that fly to 
Nicaragua, business continues, but with less confidence that 
relationships are transparent and cooperative.  We expect the 
FSLN to continue to exert control over crucial sectors of the 
economy such as aviation. 
SANDERS