BUDGET CUTS HARM ALREADY STRUGGLING HONDURAN

C O N F I D E N T I A L SECTION 01 OF 02 TEGUCIGALPA 000828

SIPDIS

STATE FOR WHA/CEN, WHA/PPC, IO, AND EB
STATE PASS AID FOR LAC/CEN

E.O. 12958: 04/02/2013
TAGS: PREL PGOV ETRD AORC IZ HO
SUBJECT: BUDGET CUTS HARM ALREADY STRUGGLING HONDURAN
FOREIGN MINISTRY

REF: A. TEGUCIGALPA 652


B. 02 TEGUCIGALPA 3407

Classified by Ambassador Larry Palmer; reasons 1.5(b) and
(d).


1. (U) SUMMARY: Severe budget cuts at the Honduran Ministry
of Foreign Affairs threaten to incapacitate its ability to
execute a coherent foreign policy strategy. The cuts,
amounting to 31 percent since President Ricardo Maduro came
into office early last year, mean new layoffs and embassy
closings, plus more work for the already overloaded staff
who remain. Several items on the Ministry's agenda affect
the U.S., including support for the Coalition of the
Willing, the current CAFTA negotiation and the country's
request to extend Temporary Protected Status for Honduran
immigrants. The present understaffed and overworked status
of MFA functionaries limits their ability to respond in a
timely manner to U.S. initiatives and demarches. END
SUMMARY.


2. (U) The Honduran Ministry of Foreign Affairs (MFA)
supports approximately 160 employees spread throughout 36
embassies, 13 consulates and 31 consular sections.
Honduras also has 45 honorary consulates whose consuls do
not earn formal salaries. However, the Ministry is in the
midst of significant budget cuts. Sources vary on the
exact amount of the cuts (see ref B for previous reporting
on MFA budget cuts). Post received the following figures
from Ambassador Mario Fortin and the Honduran press. In
2002, the MFA's allowance was cut 17 percent, leaving it at
272 million lempiras, or approximately USD 16 million. For
calendar year 2003, the budget was cut yet again, this time
by 14 percent. As a result, the MFA in 2003 has less than
USD 14 million with which to support both its domestic and
foreign operations--only 69 percent of the Ministry's 2001
budget.


3. (U) The MFA's diminishing finances are a growing
impediment to the country's ability to effectively supply
and manage its domestic and international posts and carry
out a coherent foreign policy. Primarily, these budget
cuts mean a reduction in personnel and embassy closings
and/or consolidations. According to Honduran foreign
service officers, however, conditions at overseas posts are
already spartan. Posts have minimal support staff, even in
comparison to other Central American embassies. Most
Honduran ambassadors earn between USD 4,000 and 6,000 per
month, plus an equivalent stipend for expenses. Salaries
and expense allowances for ambassadors to the U.S. and some
other countries, including Japan, are higher due to cost of
living allowances. In December 2002 the salary for the
ambassador to Japan was USD 10,000 monthly plus a USD
20,000 monthly expense allowance (Note: These figures
were reported in U.S. dollars in the Honduran press. End
Note.) According to the Honduran paper "El Heraldo," the
ambassadorship to Japan has often stayed vacant for
extended periods of time because no one has been willing to
accept the position, presumably due to lack of sufficient
funding. Foreign Minister Guillermo Perez-Cadalso Arias
was recently quoted in the Honduran press acknowledging
that ambassadorial salaries were too low and blaming the
two recent budget cuts.


4. (U) Despite these financial concerns, the MFA recently
unveiled an ambitious agenda for 2003. The agenda
includes:
--Restructuring of personnel in the Ministry, mainly due to
budget cuts (i.e., dismissals and embassy
closures/consolidations)
--CAFTA signing,
--Working with USG to extend Temporary Protected Status
(TPS) for Honduran migrants to the U.S.,
--Presentation of observations on the Solicitation of
Revision presented by El Salvador to the International
Court of Justice (concerning the El Salvador/Honduras
border dispute),
--Making progress on maritime border demarcation with
Nicaragua through the International Court of Justice,
--Overcoming technical problems in the demarcation of the
Honduras-El Salvador border,
--Continuation of negotiations of maritime boundaries with
Mexico, CUBA, and the OAS agreement on the Gulf of Honduras
(on the Caribbean coast),
--Suspension of the 35 percent tariff imposed by Nicaragua
(this was already accomplished through the temporary
suspension of the tariff on March 11 - see ref A),
--Consolidation of the Customs Union for Central America,
and
--Continuation of the Plan Puebla Panama.


5. (SBU) COMMENT: Post is concerned that the 31 percent
total cut in the MFA's budget over the last year and a half
is significantly detrimental to the Ministry's ability to
achieve its agenda goals. For Example, Director General
for Foreign Policy, Ambassador Mario Fortin, has been an
excellent contact within the MFA for Post. However, due to
limited staffing, he is forced to cover a wide range of
countries and issues.


6. (SBU) COMMENT CONTINUED: Proposed restructuring in the
MFA has had a very negative impact on morale. At times, it
appears that Ambassador Fortin is a one-man shop. He has
no substantive staff to whom he can delegate. Other
diplomats have told us that they believe he is completely
overburdened by the range of issues he covers. Post is
also concerned that cuts and or elimination of GOH posts
abroad could be highly problematic in the case of a natural
disaster, as Honduran embassies abroad were instrumental in
gathering vital international aid after the 1998 tragedy of
Hurricane Mitch.


7. (C) Comment CONTINUTED: There are a limited number of
subject experts on technical issues in the MFA, leaving the
GOH with little or no input on many complex international
issues. Post notes that the MFA's lack of technical
experts allows the U.S. to play an influential advisory
role in Honduran foreign affairs. However, the MFA's bare-
bones staff and lack of administrative support means that
it cannot easily form or implement a coherent foreign
policy strategy. A good example: last week in his visit
to D.C. Foreign Minister Perez-Cadalso assured U.S.
interlocutors that Honduras would be supportive of the U.S.
at the U.N. It appears that such forward-leaning
instructions were never sent to New York, as the Honduran
PermRep to the U.N. delivered a weaker statement at UNSC
open session on Iraq March 27 than he had before the war.
END COMMENT.

PALMER