TOLEDO SUCCESSFULLY PRESSES URIBE TO CLOSE

UNCLAS SECTION 01 OF 02 BOGOTA 008415

SIPDIS

SENSITIVE

DEPT PLS PASS USTR FOR AMB JOHNSON, AUSTR VARGO AND DAUSTR
HARMAN

E.O. 12958: N/A
TAGS: ETRD EAGR CO FTA
SUBJECT: TOLEDO SUCCESSFULLY PRESSES URIBE TO CLOSE
US-ANDEAN FTA IN OCTOBER


Sensitive but Unclassified - please protect accordingly


1. (SBU) Summary: President Uribe and Peruvian President
Toledo met in Bogota on September 5 to discuss the future of
the FTA. According to the GOC, Toledo told Uribe that his
government was willing to conclude the Free Trade Agreement
(FTA) with the U.S. by October and preferred not to do so
alone. Toledo pressed Uribe to be more flexible on
agriculture and to remove all but the most sensitive issues
in the other chapters. The GOC,s impression was that Peru
was close to agreeing to positions already on the table for
almost all the disciplines. During a press conference after
the event, the presidents expressed their support for an FTA,
acknowledged the difficulty of the agriculture negotiations,
and Toledo stated that while there still were some
outstanding issues, especially in agriculture, October should
be the month to close the negotiations. Uribe extolled the
virtues of the agreement, stating that it could add as much
as two percentage points of growth per year. Uribe seems to
have clearly understood the urgency to end the negotiations
by October and has reportedly instructed his Agricultural and
Trade Ministers traveling to Washington to lay all
Colombia,s cards on the table. End summary

The Peruvians arrive en masse


2. (SBU) President Toledo, accompanied by his Prime
Minister, Trade Minister, Agriculture Minister, as well as
congressmen and business represented arrive in Bogota
September 5 for a meeting with President Uribe and the
Colombian negotiating team to discuss the current state of
play of the negotiations. According to GOC officials, Toledo
pressed Uribe hard to move the negotiation forward and close
by October, stating that it was his understanding that the
USG felt Colombia's positions were the main stumbling block
to closing. Toledo told Uribe that Peru wanted to finish the
negotiations by October and was ready to do so, however, they
wanted to do it with Colombia as there was greater synergy
that way. Uribe told Toledo that the GOC also wanted to
conclude an agreement in the shortest time frame possible, as
approval would take a year, with at least six months in the
congress and then another six months for a constitutional
court review. Uribe told Toledo that Colombia wanted the
deal ratified before ATPDEA expiration and the only way to
assure that was conclusion by October and signing 90 days
after that.


3. (U) In a press release issued after the meeting, both
Toledo and Uribe reaffirmed their intention to close the FTA
negotiations in October. Uribe defended the importance of
the agreement to Colombia,s growth (adding possibly two
percentage points of growth per year). Both explained how
the meeting had been very important in clarifying the
positions of both countries towards the negotiations. They
also stated that they had spoken with Ecuador,s President
Palacio during the meeting, and that Palacio had clearly
explained Ecuador,s position.

Colombian assessment of Peru,s position


4. (SBU) According to Colombian officials, the GOP pushed
for closing as many tables as possible at the Cartagena round
the week of September 19, and the Colombian perception is
that the Peruvians are willing to accept many of the
proposals currently on the table at this time. In
agriculture, Peru,s main concerns center on rice, corn and
sugar. In general, Toledo, visit was seen as a wake-up call
to the Colombians that while Peru would prefer to move
forward with Colombia, they did not feel bound to do so.


5. (SBU) The Colombians are wary of Peru's moving ahead of
them, but they feel that Peru may be pulled back by concern
about getting a worse deal than those who stay longer in the
negotiations (as happened in the Mercosur ) Andean free
trade agreement). The GOC feels that while Peru is
definitely out in front, that does not necessarily mean they
are within closing distance.

Current views on FTA in Colombia


6. (SBU) Colombian Minister of Commerce Botero and Minister
of Agriculture Arias will be meeting with high level
officials at USTR and USDA on September 9 with a renewed
sense of urgency to move the negotiations forward. They will
be asking for additional flexibility from the U.S.
negotiators, particularly on less sensitive products and in
the SPS discussions. Part of the concern of the GOC is that
lack of movement on their export interests like fruits and
vegetables are giving ammunition to opponents of the
agreement, who argue that the U.S. negotiators are offering
Colombia less access than currently provided under ATPDEA
preferences.


7. (SBU) The Colombian agricultural sector feels that the
U.S. owes Colombia a response for the offers currently on the
table. The Colombian private and public sectors estimate
that with the latest offer, Colombia has offered the US over
USD 500 million in immediate agricultural market access (this
includes wheat which they calculate could be worth $200
million in access for the U.S.),and the US has offered less
than USD 1 million in new market access. (We have pointed out
to the Colombians that we disagree with this analysis, but
this analysis is the one shaping the Colombian position.)

Comment


8. (SBU) The Toledo visit may have served to underscore to
the Colombian public and private sector that the time to move
forward on the FTA is at hand. The message that Peru wants
to move forward rang through loud and clear, as did the fact
that while Peru wanted to move forward with Colombia, it did
not feel bound to do so. President Uribe is determined to
move the negotiations forward and sees October as a hard
deadline. To that end, he ordered the Trade and Agriculture
ministers to be clear in their meetings in Washington about
Colombia,s red lines and clearly state the bottom line on
the most sensitive issues (septel). End comment.
WOOD