TORRIJOS TEAM BEGINNING TO LOOK AHEAD TO NEW

C O N F I D E N T I A L SECTION 01 OF 02 PANAMA 000615

SIPDIS


DEPARTMENT PLEASE PASS TO USTR FOR AGASH AND JWOLFE


E.O. 12958: DECL: 09/02/2009
TAGS: PREL PINR ETRD MASS PM LABOR HUMAN RIGHTSPOLMIL
SUBJECT: TORRIJOS TEAM BEGINNING TO LOOK AHEAD TO NEW
ADMINISTRATION


REF: A. PANAMA 0564

B. 03 PANAMA 3173

C. 03 PANAMA 2895


Classified By: Ambassador Linda E. Watt for reason 1.5 (d)


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Summary
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1. (C) Still leading in the polls, Revolutionary Democratic
Party (PRD) presidential candidate Martin Torrijos is
starting to consider what his administration might look like,
well aware of our interest in key PRD appointments. Meeting
with PolOff, senior advisor and "friend of Martin" Ubaldino
Real, said he is confident that Torrijos can control his
party's factions and assured us of continued close
cooperation if Torrijos wins. Real added that Torrijos has
dropped plans to appoint a former uniformed officer to head
Panama's National Police (PNP),and that he had recently
journeyed to Taiwan to assure Taipei that Torrijos plans no
change in diplomatic relations.


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The Envelope Please
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2. (C) On March 2, PolOff met with Ubaldino Real, chief
financial officer and senior advisor for Revolutionary
Democratic Party (PRD) Martin Torrijos' presidential
campaign. According to Real, PRD internal polls show
Torrijos 15% ahead of Solidaridad presidential candidate
Guillermo Endara. (Note: This tracks with published polls,
with the most recent showing Torrijos nearly 18 points ahead
of second-place Endara, See ref A. End note.) The PRD
believes it can win (with its Partido Popular ally) 40
legislative seats, giving it a one-vote majority in the
78-seat Legislative Assembly. Real predicted that the PRD
would win 35 spots and coalition partner Popular Party would
win 5 spots.



3. (C) Real said that, until recently, Torrijos' had been
unwilling to concentrate on anything but the campaign--
partly out of fear of jinxing his chances-- but added that
the two had begun to "pencil in" names for an estimated 200
high-level GOP positions (ministers, vice ministers,
directors, commissioners, ambassadors and consuls general).
Real (a naturalized AmCit and close personal friend of
Martin) is considering a standing offer from Torrijos to be
Minister of the Presidency, a position similar to the
President's Chief of Staff. Real was well aware of the GOP
posts "of particular interest to the United States"--
Executive Secretary of the Public Security and National
Defense Council (Consejo),Minister of Government and Justice
(MOGJ),and the Directors of Panama's Police (PNP),Air
Service (SAN),Maritime Service (SMN),Institutional
Protection Service (SPI),Maritime Authority (AMP) and
Immigration (among others, such as Foreign Minister, Minister
of Commerce, and Ambassador to Washington).


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Balancing PRD Factions
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4. (U) Real dismissed speculation that once in power Torrijos
will have difficulty balancing the PRD's three competing
factions-- "old guard" (about 40% of the party),"new guard"
(about 60% of the party) and "friends of Martin." "This is
Martin's party," and he will make the choices. (Comment: The
campaign is heavily skewed in favor of "new guard" and
"friends of Martin," reflecting the shift in power from
former President Perez-Balladares. End Comment.) Real
emphasized that unlike with Torrijos' 1999 run or
Perez-Balladares' 1994-1999 term, the PRD presidential
candidate has not had to bargain with the various factions
before turning to the general election. Nevertheless, Real
conceded that Torrijos will have to engage in some horse
trading to placate factions or individuals who might
otherwise interfere in important policy areas. PolOff
expressed the hope that positions "of particular interest to
the United States" will not be involved in this patronage
politicking.


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Jump on the Bandwagon
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5. (C) Several members of Panama's Arab community have
recently expressed interest in donating to the Torrijos
campaign, Real said, but he has stalled, claiming the
campaign is flush with money (which is not the case). Real
said the campaign is avoiding donations from "suspicious"
individuals for fear of making "a mistake."

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Backpedaling
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6. (U) Real commented that Torrijos was unlikely to push hard
for his proposed institutional reforms to Panama's Public
Force (PPF) and other public and national security agencies
(ref B),such as appointing career officers as PPF service
directors. In hindsight, Real said, those proposals were
politically ill-conceived and not fully thought out. Real
confirmed that Daniel Delgado, the author of the proposals,
still leads the campaign's security policy team, but was
unsure whether Delgado's time and efforts would translate
into an administration position.


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Don't Sign the FTA Without US
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7. (U) Real fully expects a Torrijos administration to
conclude a US-Panama free trade agreement (FTA) and to be
involved in the negotiations. It would be "irresponsible"
for the Moscoso Administration to sign a bilateral FTA before
the September 1 inauguration, he said. Real implied that
Alejandro "Andy" Ferrer, Jr. would lead the new
administration's FTA negotiators. (Note: Also mentioned as a
possible foreign minister in a Torrijos administration,
Ferrer negotiated Panama's accession to the World Trade
Organization (WTO),serving as Panama's Special Ambassador to
the WTO and as Vice Foreign Minister. He has a law degree
from the University of Michigan and is one of the stars in
Torrijos' progressive pro-business faction. End note.)


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Taiwan: Status Quo Will Continue
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8. (C) Just back from a 2-day trip to Taiwan, Real said that
the Taiwanese had pressured Torrijos for months to send a
high-level, personal representative to allay their concerns
and respond to persistent rumors that Torrijos will switch
diplomatic recognition to China if he wins. Real was
instructed to assure Taiwan unequivocally that a Torrijos
administration would maintain the status quo (ref C).


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Comment
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9. (C) The Torrijos team is well aware of our interest in
certain high-level PRD appointments, and we anticipate having
more intensive discussions on that topic after the May 2
election. On the FTA and on other important bilateral issues
(such as security),Embassy is making plans with Department
to brief transition teams from the victorious party. From
the perspective in Panama, we believe it's unlikely that FTA
talks could be wrapped up before September 1. Torrijos'
decision not to carry out his publicly announced plan to
reform the security services (which was not well received
among the electorate because it could have centralized too
much power over the security forces) or to appoint a former
uniformed officer to head the PNP were welcome moves. On the
other hand, the fact that he delivered a less than fully
cleared speech suggests that those who charge that Torrijos
allows others to put words in his mouth may have a point.




WATT