AMBASSADOR TELLS TRADE MINISTER COLOMBIA NEEDS TO

C O N F I D E N T I A L SECTION 01 OF 03 BOGOTA 004397

SIPDIS

DEPT PLS PASS USTR FOR RVARGO AND BHARMAN

E.O. 12958: DECL: 05/06/2015
TAGS: ETRD ECON EAGR KIPR CO
SUBJECT: AMBASSADOR TELLS TRADE MINISTER COLOMBIA NEEDS TO
STEP UP TO THE PLATE ON AGRICULTURE DISCUSSIONS IN FTA


Classified By: Ambassador William B. Wood, reasons 1.4 (b) and (d)

(C) 1. Summary. In a two hour meeting May 5, the
Ambassador told Trade Minister Botero and FTA lead negotiator
Gomez that the GOC needed to substantially improve its
agricultural market access offer if it hoped to close the FTA
negotiations in the near future. Botero responded the GOC
would do so in new market offers for wheat, soy and soy meal,
barley and other grains within a few days (the proposal,
which demonstrated improvements was transmitted to USTR May
6). Botero underscored GOC understanding it had to break the
negative cycle in the agriculture negotiations with
aggressive improvements, but these would be conditioned on
similar moves by the USG. Botero told the Ambassador that he
would meet with the new Ecuadorian Commerce Minister May 6 to
tell him that Colombia would support Ecuador's continued
presence at the FTA negotiations so long as the new GOE did
not slow down the process. Botero stated that the GOC was
willing to meet USG requests on intellectual property on data
protection, linkage and extension of patent terms due to
undue administrative delays. Botero also stated that the GOC
was willing to accept the SPS proposal the USG provided in
Lima, with some modifications. Botero stressed the GOC was
committed to finishing the FTA within two rounds and would
demonstrate this in the coming weeks. End Summary.


2. (C) On May 5, Ambassador and Econcouns met with Trade
Minister Botero and FTA lead negotiator Gomez to discuss the
current state of play of the FTA negotiations. Botero led
off the meeting by expressing the GOC's belief that almost
all the negotiating tables were within two rounds of closing.
The Ambassador concurred that there had been important
progress, but stressed that the overall lack of progress in
agricultural market access, and specifically the GOC's slow
progress, was jeopardizing the possibility of closing the
negotiations by the target date of July that the President
mentioned to Secretary Rice only a few days before.

BOTERO SEEKS USG SUPPORT ON TIMING


3. (C) Minister Botero said he would travel to Quito May 6
for meetings with Trade Minister Molestino and possibly
President Palacio. Botero added he had three main messages
for the GOE: a) Colombian solidarity with Ecuador's continued
presence in the negotiations
if Ecuador did not slow down the process; b) Colombia's
willingness to delay the next round for one week; c) a
message that the GOE had to maintain prior commitments on all
issues, especially IPR. The Minister stated the Ecuadorian
delay was due to internal political issues, but Colombia
could not accept more than a week's delay. Botero expressed
concern a delay of over one week would delay the July round
because all countries needed at least four weeks between
rounds. He noted the USG could not field a team past the
second week of July because of WTO commitments. Botero asked
for USG support for Colombia's position on timing.

TROUBLE SPOTS - INTELLECTUAL PROPERTY


4. (C) Minister Botero commented the GOC felt only three
tables were more than two rounds away from closing -
intellectual property, SPS and agricultural market access.
Botero felt delay in closing the IP table was due to
political concerns. Colombia was willing to accept USG
positions on data protection, linkage and extension of patent
terms for processing delays, but could not accept patents for
animal and plant species, second-use patents and any other
type of patent term extension. Botero and Gomez both
expressed gratitude for USG positions on biodiversity and
technology transfer, stating the USG willingness to include
these issues was fundamental to obtaining political support
for the agreement in Colombia. Botero stated the GOC could
only make concessions on the points at the final round to
avoid domestic political repercussions.

SPS


5. (C) Botero then turned to the problems in the Sanitary
and Phyto-Sanitary table. He expressed Colombia's interest
in gaining real market access to the US and the GOC's
conviction that strong cooperation on SPS issues was a
prerequisite for such access. The Ambassador stated the USG
had tabled text in Lima that would have made such cooperation
possible, under terms similar, but not identical, to those
the GOC sought, but the GOC had rejected the text outright.
Gomez denied this, stating the GOC had taken the offer under
consideration, but added the GOC was working with Ecuador and
Peru to send a message to the US would accept the proposal
(which he termed Chile-plus),so long as the terms of
reference for the technical working group were included as a
side letter to the FTA itself, not negotiated afterwards.


6. (C) Gomez explained he had consulted with the Chilean
government and was concerned that after more than one year
the terms of reference for the Chilean technical committee
had still not been worked out and the committee had yet to
meet. Colombia could not afford a similar delay, stated
Botero, as access for many of Colombia's offensive interests
depended on SPS issues. The Ambassador cautioned SPS issues
are and always must remain scientifically based, and the GOC
must not endeavor to introduce political considerations in
the SPS process. Gomez and Botero agreed and stated the GOC
had no such intention.

AGRICULTURAL MARKET ACCESS


7. (C) With respect to agricultural market access, Botero
stated there was a negative, vicious cycle in that table
which was forcing both sides to make very conservative offers
and delaying progress. Botero understood it was imperative
to create a more positive dynamic. The Ambassador agreed it
was important to change the dynamic in agriculture, and
argued the GOC was well known for its brinkmanship in
negotiations, but they had reached the brink and were in
great danger of falling. The Ambassador added that the GOC's
offers were so weak that many in the USG doubted if the GOC
had the desire or political strength to close the deal.
Gomez answered that the GOC had developed a series of new
offers, which they hoped to transmit to the USG shortly, that
would offer TRQ's on wheat, soy and soy meal, barley and
other grains (excluding corn) and over quota tariff levels
that would equal Mercosur's as well as more truncated
transition periods. These offers were transmitted on May 6
and an initial review indicates that while they do represent
marked improvements, they are not a breakthrough.


8. (C) At the meeting, Gomez stated that the GOC hoped that
the USG would respond with offers on flowers and tobacco and
cigarettes. Gomez earlier told ECONCOUNS that the GOC was
willing to consider a US counteroffer in other products (such
as fruits and vegetables) so long as the market value of the
offers were similar, as any large imbalance in the offers
would kill them politically. Gomez and Botero both stated
that the GOC hoped this offer would change the dynamic of the
negotiations and turn a vicious cycle into a virtuous one.
They also confided they were having problems gaining private
sector support for this offer, as the private sector hoped to
trade off access on these products for greater protection for
corn. Gomez and Botero are trying to break that mindset,
stating that any exchange regarding corn would more likely be
tied to more sensitive products for the GOC such as chicken
leg quarters or sugar. The offer finally submitted May 6
asked for USG counterproposals in fruits and vegetables,
tobacco and cigarettes and ethanol.


9. (C) Botero affirmed that the GOC needed some type of
price safeguard, although not necessarily a permanent one, on
only four products -- beans, chicken leg quarters, rice and
corn. He stated that these products were important
politically because they were essential in maintaining
campesinos working on licit crops. Botero and Gomez agreed
that the GOC was willing to justify the need for special
treatment on these products for counter-narcotics reasons
that were Colombia specific, thereby making it more difficult
to argue that such concessions on the part of the USG were
precedent setting. The Ambassador warned against using
political arguments in a commercial discussion as the USG was
negotiating FTA's with several countries and each one felt
that they had political considerations that were worthy of
special attention. The Ambassador stated that the agreement
must stand on its commercial merits to gain approval by the
US Congress and private sector. Minister Botero replied that
the GOC was also able to justify its request on technical
reasons.


10. (C) Minister Botero reaffirmed the GOC's desire to
finish the negotiations within two rounds. He stated that
the President and the rest of the GOC were resolute in their
desire to conclude an FTA with the U.S. Minster Botero also
requested that the Ambassador continue to meet with him to
discuss the FTA and the Ambassador agreed to future meetings
as needed.

IS THE GOC READY TO DEAL?


11. (C) Comment: Botero and Gomez clearly believe that the
lack of progress on agricultural issues is threatening the
FTA. They were both clear the GOC believes its newest offers
would help break the deadlock. At the meeting, they
championed the extreme position that if future rounds were
not to include agricultural meetings, then the GOC would not
be able to field any negotiators. It appears however, that
they took the warnings about brinkmanship to heart, and when
faced with a US proposal on May 9 not to include agriculture
at the next round, but hold substantive talks in agriculture
in Washington, they did not reject the offer and seem to be
willing to accept it, although they would like to suggest
Colombia as the venue for domestic political reasons. These
political pressures are very strong and holding meetings in
Colombia would help the GOC's efforts to sell the FTA to the
agricultural community. Moreover, while the GOC's latest
offer is not groundbreaking, it does represent a departure
from past practice and a willingness, arguably for the first
time, to discuss agricultural market access seriously. The
USG's acceptance of Colombia as venue instead of Washington
could be successfully played as the USG recognizing
Colombia's forward movement, without recognizing the strings
attached to Colombia's improved agricultural offer.
WOOD