PARAGUAY: A TIME TO TREAD LIGHTLY ON ARTICLE 98

C O N F I D E N T I A L SECTION 01 OF 03 ASUNCION 000868

SIPDIS

STATE FOR A/S NORIEGA, A/S RADEMAKER, PDAS DERHAM, PM P
MURRAY AND W BROOKS
STATE ALSO FOR T 7208 HST FRANCIS BOLTON
STATE PASS TO USAID LAC/AA
DOD FOR OUSD(P)/ISP/NP/ICC COL TIA JOHNSON
NSC FOR SUE CRONIN
SOUTHCOM FOR GEN CRADDOCK AND POLAD DAN JOHNSON

E.O. 12958: DECL: 07/07/2015
TAGS: MARR MASS PGOV PREL PINR PA KICC
SUBJECT: PARAGUAY: A TIME TO TREAD LIGHTLY ON ARTICLE 98

REF: A. ASUNCION 00860

B. ASUNCION 00669

C. ASUNCION 00567

D. ASUNCION 00526

Classified By: Ambassador John F. Keane, reasons 1.4(b) and (d).


1. (C) Summary and Introduction: Recent erroneous press
reports in Paraguay and neighboring countries (ref A) are
unhelpful to our ongoing Article 98 negotiations with
Paraguay, which reached deadlock several months ago (refs B,
C, D). What currently separates us is six words, so we
should not lose hope. The Ambassador will discuss the issue
again with Foreign Minister (FM) Rachid at their next
meeting. We may need to wait until current unfavorable press
coverage blows over to get a good sense of how best to
proceed. The fact that we have several military exercises
starting now and in the near future will retain press
interest, as will SOUTHCOM Combatant Commander General
Craddock's and SECDEF Rumsfeld's upcoming visits. The GOP
will likely be nervous about the public pressure and thus
cautious. As a result, the next few weeks will probably be a
time to lay low and try to avoid debating the issue in the
media. To do otherwise could well lose us the permissive
environment we have for exercises, which is valuable in its
own right, while gaining nothing on Article 98. On July 7,
the Embassy issued a press release to correct some of the
more absurd accusations that have surfaced in the press (see
paras. 4 and 5, below). We intentionally did not/not raise
the ICC, but others have, and will continue to do so. End
Summary and Introduction.

Flap Over Article 98/Immunities
--------------

2. (C) Recent press in Paraguay and neighboring countries
criticizing military exercises in Paraguay has accused us of
everything from planning to set up a permanent base here to
scheming to steal fresh water from the Guarani Aquifer. An
Argentine journalist wrote an article linking the recent
exercise immunities agreement to Article 98 protections,
suggesting this agreement violates a MERCOSUR commitment not
to enter into Article 98 agreement with the U.S. and
represented another reason to object to military exercises.
A July 7 article in the Bolivian press claimed the U.S.
sought to establish a base 250 kms off Bolivia's border with
Paraguay for the purpose of watching Bolivia's oil and gas
reserves. There have been other reports closer to the truth.
However, as Washington looks at how to proceed in Article 98
negotiations, we offer the following points for consideration:

-- Paraguay currently offers the most permissive environment
for exercises in the region. That is a very valuable thing
in and of itself which can not be taken for granted. This
environment could be jeopardized if we do not handle deftly
certain issues, particularly those related to Article 98 and
the ICC.

-- FM Rachid told the Ambassador that her counterparts in
Buenos Aires and Brasilia are very uncomfortable with the
close military-to-military relationship between the U.S. and
Paraguay; they would like to undo it, not only for
ideological reasons, but because it causes them problems with
their own Ministers of Defense, who would like to have U.S.
exercises and cannot because those governments will not
provide the protections the GOP offers. Ceferino Valdez, MFA
Director of Bilateral Affairs, told the Ambassador that the
Argentine Ambassador had sent Paraguay a note "on
instructions from Buenos Aires" requesting it explain its
agreement with the U.S. on exercise immunities. Valdez
expressed resentment over the GOA's impertinence but
indicated the FM had not decided yet how to respond.

-- FM Rachid and others defended exercise immunities by
expressly and publicly reiterating the GOP position that it
will not/not sign an Article 98 agreement and that nothing in
the exercise immunities agreements interferes with Paraguay's
ICC obligations. We see the immunities agreements as
protecting our troops from the ICC but do not advertise that
interpretation.

-- A few Senators reacted to the FM's remarks by requesting
the MFA incorporate into exercise immunities agreements
language specifying that they do not violate ICC obligations.
We have no new immunity negotiations coming up for another
18 months, and the Ambassador told FM Rachid that we would
not/not accept reopening the immunity agreement already
negotiated and passed by the Senate. Rachid said she had no
intention of seeking that but told the press that it was a
possibility to get them off her back.
-- Further complicating things, the new President of
Congress, for a twelve-month period, is a leftist who is
against all U.S. exercises here and a strong ICC supporter.
We intentionally front-loaded the negotiations to get all
exercise permissions for 18 months through Congress before he
took over.

-- Separately, the German Ambassador to Paraguay, Horst
Wolfram Krell, wrote a letter to one of Paraguay's leading
newspapers "reminding" it that no country can guarantee
immunity for crimes listed under Article 5 of the Rome Treaty
and suggesting Paraguay incorporate a clause in future
immunities agreements with the U.S. stating its intention to
honor its Rome Treaty obligations. Ambassador Keane objected
to Krell's action, noting that it was interference in
U.S.-Paraguayan bilateral relations. Krell told the
Ambassador that he had delivered that message on instructions.

-- Paraguay and MERCOSUR partners adopted a declaration at
the recent Summit committing themselves not to sign bilateral
or multilateral agreements that would affect the
jurisdictional basis of the ICC, particularly in connection
to Article 98.

-- Upcoming visits by SOUTHCOM Commander Craddock and a
possible visit by SECDEF Rumsfeld will prompt another round
of rumors and misinformation on the military exercises.

Implications for US policy
--------------

3. (C) We remain in negotiations with FM Rachid about the
possibility of an exchange of notes which would both give us
Article 98 protections and allow the GOP to continue to say
it had not/not signed an Article 98 agreement; we are seeking
a "non-agreement" "arrangement" open to diverse
interpretations. However, all of the above suggests we have
entered a delicate stage for Article 98 negotiations. First,
the GOP is on record, in public and with its neighbors that
it will not sign an agreement; to do so would seem a craven
surrender to U.S. pressure. Second, pushing ahead the
Article 98 debate could well lose us the permissive
environment we have for exercises which is valuable in its
own right. Post recommends a cooling period before resuming
negotiations in earnest allowing for press and public
interest in the military exercises to die down.

Press Release
--------------

4. (U) On July 7, the Embassy issued the following press
release to respond to some of the more absurd accusations
that have surfaced in the press:

Begin text.

The media and others in nearby countries have made statements
about U.S.-Paraguayan military cooperation that are not true
and have absolutely no basis in fact. The truth about some
of the more ridiculous accusations is as follows:

-- The U.S. has absolutely no intention of establishing a
military base anywhere in Paraguay.
-- The U.S. has no intention to station soldiers for a
lengthy period in Paraguay.
-- The U.S. has no designs of any kind on Ciudad del Este,
except that we are supporting programs to create jobs for
Paraguayans there.
-- The U.S. has no interest in the Guarani Aquifer, except
that we hope it will be a resource which assists the
prosperity and well being of the inhabitants in its
geographic proximity.

With respect to the recent accord between the US and
Paraguay, approved by the Paraguayan Congress, for a number
of short-term, joint military training exercises, the truth
is that:

-- The U.S. and Paraguay have been conducting similar
exercises for many years; there is nothing new in these.
-- Small numbers of US personnel, generally 10 to 20 persons,
will train with their Paraguayan military colleagues during
periods of two to six weeks. No U.S. soldiers will be
deployed for an extended period of time, and there will never
be more than a few dozen U.S. service members in Paraguay for
longer than 45 days.
-- Among the first exercises are humanitarian medical
assistance to thousands of needy campesinos and others in the
Departments of Canindeyu, Caazapa and Neembucu.
-- Several other short-term exercises for training of various
types will take place at different times in various locations
between now and December 2006. Again, none of the training
lasts more than 45 days.
-- Similar exercises for training occur routinely between
U.S. armed services and the militaries of many other
countries in Latin America, as they have for decades. Their
purpose in all countries is to enhance the capabilities of
the Latin American and U.S. militaries, and, in many cases,
to provide humanitarian assistance to local populations.
-- These exercises for training are not linked to any other
assistance being provided by the U.S. government.

End Text.


5. (U) FM Rachid told the Ambassador she would release a
similar statement, but adding that Paraguay had not signed
any agreement with any country that violated its obligations
under the Rome Treaty.
KEANE