DOMINICAN PRESIDENT-ELECT LOOKS FORWARD TO CLOSE

C O N F I D E N T I A L SECTION 01 OF 03 SANTO DOMINGO 003004 SIPDIS SENSITIVE STATE FOR WHA, WHA/CAR, WHA/PPC AND DRL NSC FOR SHANNON AND MADISON LABOR FOR ILAB TREASURY FOR OASIA-LAMONICA USDOC FOR 4322/ITA/MAC/WH/CARIBBEAN BASIN DIVISION USDOC FOR 3134/ITA/USFCS/RD/WH DHS FOR CIS-CARLOS ITURREGUI; SOUTHCOM ALSO FOR POLAD E.O. 12958: DECL: 05/19/2014 TAGS: PGOV DR SUBJECT: DOMINICAN PRESIDENT-ELECT LOOKS FORWARD TO CLOSE RELATIONS WITH U.S. Classified By: Ambassador Hans Hertell. Reason: 1.5 (b) and (d). ¶1. (SBU) Summary. Dominican President-elect Leonel Fernandez assured the Ambassador on May 19 that he anticipated close and collaborative relations with the United States. Economic issues will occupy much of his time. Dominican relations with Cuba are a relatively low priority for him. Fernandez will discourage Venezuela's Hugo Chavez from using anti-U.S. rhetoric. He will have "zero tolerance" for corruption and narcotics trafficking. In his second term he will have a better understanding of what the United States has to offer. Fernandez asked whether the USG could provide expert advice on "governability." End summary. ¶2. (SBU) On May 19 President-elect Leonel Fernandez received the Ambassador, DCM and EcoPol counselor at his offices at the Foundation for Global Development (FUNGLODE). Fernandez was friendly and appeared rested and relaxed. The meeting lasted for more than an hour (despite the crowd of party members, officials, and press waiting in the foundation and outside). Fernandez thanked the Ambassador for helping assure the presence of a large number of international observers for the May 16 election. He said that without their presence and vigilance, the governing PRD of President Mejia would have been able to use fraud and intimidation to push the elections into a second round. ¶3. (C) The Ambassador expressed USG satisfaction at the conduct of the elections and at the positive role played by observers. He described events leading up to the emotional press comments in mid-evening of Msgr. Agripino Nunez, head of the Elections Monitoring Committee ("Comision de Seguimiento")(septel). Fernandez commented that by evoking the three-month election stalemate of 1978, Nunez had helped forestall PRD meddling in the results of the first round. ¶4. (C) The Ambassador noted for Fernandez the concern of the USG about the possible evolution of Dominican relations with Cuba and with Venezuela. He left Fernandez a copy of the executive summary of the recent Commission for Assistance to a Free Cuba. Fernandez commented that his energies would be devoted immediately to economic issues, in the hopes that a bad 2004 could be followed by a better 2005. Relations with Cuba would be far down his list of priorities. "I understand your sensitivities about Cuba. The United States is the most important partner of the Dominican Republic." As for Venezuela, he said he needs to engage Chavez because pursuant to the San Jose accords, Venezuela supplies almost all of the fuel for power plants in the Dominican Republic. He hopes to secure the continuation or improvement of terms for purchase of Venezuelan petroleum. Fernandez commented that he would be suggesting to Venezuelan President Chavez that he refrain from anti-U.S. rhetoric. "He owes me one," smiled Fernandez, referring to his own mediation between Chavez and the Carter Center in early 2002. ¶5. (C) Fernandez said that he would have "zero tolerance" for corruption and for any involvement with narcotics trafficking. During his practice as a criminal lawyer, he said, he never accepted any clients accused of narcotics offenses. He confirmed his interest in receiving briefings on law enforcement cooperation and appeared receptive to the Ambassador's offer to vet with U.S. databases the names of prospective nominees for sensitive positions. Fernandez said that his administration would work closely on law enforcement matters with the USG. He mentioned his concern about lax controls in airports and ports, and the Ambassador outlined for him the current DHS "90-day letter" notification to the Dominican authorities of the requirement to raise security standards at Las Americas Airport in Santo Domingo ¶6. (C) He has no plans to travel to Washington, but he will go to the New York area during the summer to accept an honorary doctorate at the Stephens Institute of Technology. He expects to meet economist Jeffrey Sachs and hopes to call on New York mayor Michael Bloomberg. Economics and Governability ¶7. (SBU) Fernandez stressed his interest in working with the econ staff of the Embassy and checked to see that the Embassy had received a copy of the report commissioned from the Economist Intelligence Unit. The most pressing priority for him, he said, is taking action to reduce the quasi-fiscal deficit constituted as certificates of deposit at the Central Bank. His advisors are suggesting early action to sell state assets so as to pay down the amount of debt outstanding. Fernandez mentioned assets acquired in the Baninter liquidation process but otherwise was not specific. He believes that reducing the short-term debt burden will increase confidence and help increase the value of the peso in exchange markets with positive effects on prices. He made no specific comments about the IMF program or sovereign debt issues. ¶8. (SBU) Fernandez spoke of plans to reinforce the "brand" of the Dominican Republic by organizing international broadcasts of baseball and cultural events (an idea drawn from the EIU study). "It will be fun, being president." He commented that in his second term he will have a much clearer idea of the possiblities of U.S. cooperation and support. He wants to work closely with U.S. governors of states with significant Dominican populations (New York, New Jersey, Florida and Illinois) and with other large U.S. states (California and Texas). ¶9. (U) The President-elect mentioned a USAID-financed study on issues of "governability" done for President Sanchez Lozada of Bolivia by Dr. Eduardo Gamara of Florida International University. Considering the delicate state of politics and the economy, he is very interested in finding out whether he can obtain USG technical assistance for a similar study. - - - - - - - - - - - - Taking Mejia's measure - - - - - - - - - - - - ¶10. (C) Fernandez considers that despite his intelligence, President Meja is simply not a conceptual thinker. Mejia's intuitive, energetic populist character makes him vulnerable to clever manipulators about him, such as economic advisor Andres Dauhajre, Junior. (In contrast, Fernandez has great respect for Mejia's Technical Secretary Carlos Despradel.) Fernandez believes that PRD manipulators were on their way to disrupting the vote count, a scheme that Mejia forestalled by conceding the election at 11:40 when only 2.8 percent of polling stations had succeeded in notifying results to the Central Elections Board (JCE). ¶11. (C) He said he was surprised by Mejia's public comment yesterday that Mejia would not attend the May 28 regional summit in Monterrey and the suggestion that Fernandez or a Fernandez representative represent the Dominican Republic. Mejia is president for three more months, Fernandez stressed, and Mejia needs to fulfill his responsibilities. Fernandez takes the report as a sign that Mejia is worn down after the months of energetic campaigning. ¶12. (C) Fernandez emphasized that he has no intention of instituting legal action against Mejia. "In the United States there is great respect for the institution of the Presidency," he commented, "and this recent history in Latin America of prosecuting presidents as soon as they leave office is wrong and undignified." He expects to work with Mejia's officials toward a smooth transition. Fernandez did not mention any further arrangments in this regard. ¶13. (U) In closing, Fernandez accepted the Ambassador's offer to host meetings between the incoming administration team and senior staff of the Embassy. He again stressed the importance in his eyes of relations with the United States, recalling his previous remark that Dominican relations are based on key geographical points: Puerto Rico, Miami, New York, and Madrid. HERTELL