Identifier
Created
Classification
Origin
04SANTODOMINGO5156
2004-09-15 20:17:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Santo Domingo
Cable title:  

DOMINICAN AMCHAM MEETING TURNS UGLY OVER SUGAR AND

Tags:  ETRD PREL BEXP 
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This record is a partial extract of the original cable. The full text of the original cable is not available.
UNCLAS SANTO DOMINGO 005156 

SIPDIS

SENSITIVE

STATE FOR WHA, WHA/CAR, WHA/EPSC, EB/TPP/BTA (MATTHEWMAN),
EB/CBA; WHITE HOUSE FOR USTR (R VARGO, S CRONIN -- SEE PARA
5); NSC FOR SHANNON AND MADISON;LABOR FOR ILAB; USCINCSO
ALSO FOR POLAD;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

E.O. 12958: N/A
TAGS: ETRD PREL BEXP
SUBJECT: DOMINICAN AMCHAM MEETING TURNS UGLY OVER SUGAR AND
FTA

UNCLAS SANTO DOMINGO 005156

SIPDIS

SENSITIVE

STATE FOR WHA, WHA/CAR, WHA/EPSC, EB/TPP/BTA (MATTHEWMAN),
EB/CBA; WHITE HOUSE FOR USTR (R VARGO, S CRONIN -- SEE PARA
5); NSC FOR SHANNON AND MADISON;LABOR FOR ILAB; USCINCSO
ALSO FOR POLAD;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

E.O. 12958: N/A
TAGS: ETRD PREL BEXP
SUBJECT: DOMINICAN AMCHAM MEETING TURNS UGLY OVER SUGAR AND
FTA


1. (SBU) At the American Chamber of Commerce,s September
13th board meeting, Charge and Embassy staff were subjected
to a harsh rant by sugar interests. The meeting was to have
focused on DR-CAFTA, but it became a forum for a discussion
of the demands of the sugar sector for protection and the
recently proposed 25% tax on drinks sweetened with high
fructose corn syrup (HFCS). Alfonso Paniagua, sugar lobbyist
and Vice President of Costasur/Central Romana argued loudly
against removing the 25% tax from pending tax legislation.
Although the majority of the participating board members
spoke moderately and in favor of DR-CAFTA, several others
joined Paniagua in his argument that the Dominican sugar
industry cannot compete with an "extremely subsidized8
product (HFCS).


2. (U) The Charge noted that in the World Trde Organization
the United States is negotiating to liberalize agricultural
trade. She thanked the AmCham for their letter to the
Dominican Congress requesting rejection of the 25 percent tax
on fructose-flavored drinks. She said that the U.S.
Government, through USAID, is investing approximately 3
million dollars per year in trade capacity building programs
to help the Dominican Republic become more competitive. The
Embassy understands that with the agreement, some sectors
will benefit more than others. She indicated that a 15-year
period had been negotiated for phasing in imports of corn
syrup, affording the domestic sugar industry a long period of
time for adjustment. She emphasized that the Dominican
Republic cannot afford to miss the opportunity to implement
the FTA with the United States.


3. (SBU) Haydee de Rainieri, Vice President of the
tourism-related Punta Cana Group, asked what would happen if
the DR-CAFTA were to fail. The Charge responded that failure
would stiffen opposition in the United States to giving the
Dominican Republic another chance at a FTA. There is already
a long list of countries seeking to negotiate with us. The
Dominican Republic must take the opportunity "now, while the
window is open."


4. (U) AID's Joseph Goodwin described various trade capacity
building programs currently underway, and cited a study done
by AID in 2003 estimating that if DR-CAFTA is not approved,
the Free Trade Zone Industry here will lose at least 40,000
jobs.


5. (SBU) AmCham member Luis Heredia Bonetti, a leading
attorney, asked whether it might be possible to add a
protocol to the FTA specifying that both sides are interested
in seeing the elimination of agricultural subsidies through
the WTO. The Charge agreed to forward the question to USTR.


6. (U) Further discussion showed that board members were
divided on the sugar issue; Frank Rainieri, tourism
entrepreneur heading the Punta Cana Group, suggested that the
sugar issue be renegotiated at the WTO, since sugar was the
only sticking point among AmCham members. There was no
definitive reaction to his suggestion.
KUBISKE