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DE RUEHBO #3261/01 2991712
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FM AMEMBASSY BOGOTA
TO RUEHC/SECSTATE WASHDC 0510
INFO RHEHNSC/WHITE HOUSE NATIONAL SECURITY COUNCIL WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHBR/AMEMBASSY BRASILIA 0116
RUEHBU/AMEMBASSY BUENOS AIRES 0359
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RUEHLP/AMEMBASSY LA PAZ OCT LIMA 0472
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RUEHZP/AMEMBASSY PANAMA

UNCLAS BOGOTA 003261 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ETRD ECON PREL ELAB EINV PGOV CO
SUBJECT: COLOMBIAN FRUSTRATION MOUNTS OVER INACTION ON U.S.-CTPA 
 
¶1.   (SBU)  SUMMARY.  While Colombians generally understand U.S. 
political realities associated with a vote on the U.S.-Colombia 
Trade Promotion Agreement (U.S.-CTPA), resignation has grown within 
the Colombian government, business and academic communities over 
the lack of action on the accord.  The Government of Colombia (GOC) 
remains committed to the Agreement's passage, but worries that its 
efforts will turn out to be unsuccessful.  Business community 
members believe that long-term inaction on the U.S.-CTPA will not 
result in a leftward political shift in Colombia, but will be 
detrimental to U.S.-Colombian relations.  Academics lament that the 
delay has kept Colombia from locking in certain reforms that would 
live on beyond Uribe's administration.  Union leaders supportive of 
the Agreement note the urgent need for the jobs it would create. 
Union leaders that oppose the U.S.-CTPA applaud the delay and 
support continued unilateral trade preferences in its place.  END 
SUMMARY. 
 
 
 
¶2.  (SBU) Most Colombians understand U.S. domestic political 
realities and concerns over labor and labor violence issues 
associated with the U.S.-CTPA.  They are aware of the President's 
statements during the campaign and his statement on the FTA 
following the Uribe bilat in June.  Nonetheless, in our 
conversations with various stakeholders, responses range from 
frustration and resignation to satisfaction over a delay in a vote 
on the Agreement. 
 
 
 
GOC:  GROWING RESIGNATION 
 
----------------------------------------- 
 
 
 
¶3.  (SBU) GOC interlocutors believe the U.S. health insurance 
reform debate will preclude consideration of the FTA at this time. 
They point to it as one of a list of political issues (including 
Trade Adjustment Assistance, the 2008 elections, and assistance to 
U.S. automakers) that have trumped consideration of the U.S.-CTPA 
since it was first signed in November 2006.  On October 8, when 
Colombian Senate candidate and former Colombian Central Bank board 
member Juan Mario Laserna publicly characterized Secretary 
Clinton's alleged remarks to a closed meeting as implying that 
action on the U.S.-CTPA would not come until one-and-a-half to two 
years, reaction from our contacts appeared to be less surprise, and 
more resignation. 
 
 
 
¶4.  (SBU) Juan Lucas Restrepo, who negotiated the chapter on 
Sanitary and Phytosanitary Measures for Colombia, warned that the 
internal danger for the GOC, legislature and business community 
would be a loss of faith that the kind of open, transparent, 
professional negotiation process that the U.S.-CTPA entailed is 
worth the effort.  Vice Minister of Trade Gabriel Duque reiterated 
the GOC's commitment to providing us with information on Colombia's 
labor laws as well as violence and impunity.  He expressed a desire 
that any requests for action in these areas be part of the 
implementation process, rather than preconditions for a vote.  He 
also said the GOC would be asking for a two-year extension of 
Andean Trade Promotion and Drug Eradication Act (ATPDEA) benefits 
for Colombia. 
 
 
 
PRIVATE SECTOR SEES POTENTIAL HARM TO BILATERAL RELATIONS 
 
--------------------------------------------- ---------------------- 
---------------------- 
 
 
 
¶5.  (SBU) Leaders of U.S. and local companies in Colombia are 
focused on how the U.S.-CTPA will benefit them in the global value 
chain, regardless of whether they export to the United States. 
Mauricio Alvarez, who runs a leather factory that employs 
 
approximately 100 people, including former members of illegal armed 
groups, told us he would import more of a key input (ballistic 
nylon) from his Delaware-based supplier were it not for the current 
steep tariff that would disappear upon entry into force of the 
U.S.-CTPA. 
 
 
 
¶6.  (SBU) The President of a large textile factory in Medellin told 
us that a political shift to the left in Colombia, as some have 
suggested, would be an unlikely response to a failure to pass the 
U.S.-CTPA.  He feared that prolonged inaction would damage the 
bilateral relationship.  He also noted that the Colombian duty on 
imported U.S. cotton, an input for his textiles and apparel, 
remains in place and increases his production costs. 
 
 
 
ACADEMICS SEE MISSED OPPORTUNITY 
 
--------------------------------------------- ------- 
 
 
 
¶7.  (SBU)  Economists expressed dismay at the delay because it 
represents a missed opportunity to lock in reforms that would 
continue beyond the Uribe administration.  Hernan Vallejo, a trade 
economist from Universidad de los Andes pointed to advances in 
intellectual property and investment protections in particular.  He 
opined that a subsequent Colombian administration would be free to 
withdraw from U.S.-CTPA commitments if the Agreement had not 
already entered into force. 
 
 
 
PRO-FTA UNIONS:  U.S.-CTPA MEANS JOBS 
 
--------------------------------------------- ------------ 
 
 
 
¶8.  (SBU)  The pro-free trade segment of unionized labor, 
particularly in export-oriented sectors, such as textiles, 
emphasizes the benefits the U.S.-CTPA will bring in the form of 
jobs.  Luis German Restrepo, leader of a textile-sector union, 
emphasized the urgency of the employment aspect of the U.S.-CTPA, 
given the dramatic downturn in trade with Colombia's largest 
non-traditional export market, Venezuela. 
 
 
 
ANTI-FTA UNIONS:  KEEP UNILATERAL PREFERENCES COMING 
 
--------------------------------------------- ---------------------- 
--------------- 
 
 
 
¶9.  (SBU)  On the other hand, one group quite pleased with the 
state of the U.S.-CTPA is that segment of Colombian unionized 
labor, including the Unified Workers Central (CUT - the country's 
largest labor confederation), that opposes all of Colombia's free 
trade agreements (FTAs).  Jose Luciano Sanin, President of the 
National Unionist School (ENS) is unabashed in his mercantilist 
argument in favor of continuing unilateral trade preferences for 
Colombia, while opposing FTAs because he says they put the 
interests of corporations above those of individuals. 
 
 
 
CONCLUSION:  MITIGATING DETRIMENTAL EFFECTS 
 
--------------------------------------------- ---------------------- 
- 
 
 
 
¶10.  (SBU)  While political realities will dictate if and when a 
 
vote on the U.S.-CTPA occurs, the USG can work to mitigate any 
negative impact on the bilateral relationship through consistency 
and clarity of our message about the trade accord.  We are 
exploring other areas where we can augment the bilateral economic 
relationship.  A two-year extension of ATPDEA benefits might be one 
such area.  There may be others. 
BROWNFIELD