(C) PANAMA: DIALOGUE WITH TAIWAN ON PRC ACTIVITIES

S E C R E T SECTION 01 OF 02 PANAMA 001695 SIPDIS NOFORN DEPARTMENT FOR WHA/CEN, EAP/CM AND EAP/TW SOUTHCOM ALSO FOR POLAD E.O. 12958: DECL: 08/09/2015 TAGS: PREL PGOV PINR PM TW POL CHIEF SUBJECT: (C) PANAMA: DIALOGUE WITH TAIWAN ON PRC ACTIVITIES REF: A. STATE 143649 ¶B. PANAMA 0909 Classified By: CHARGE DE AFFAIRES LUIS ARREAGA FOR REASONS 1.4 (B) AND (D). Nature of U.S. Contacts with Local Taiwans -------------- ¶1. (C/NF) Embassy maintains excellent informal relations with Taiwan diplomats in Panama and frequently engages in productive dialogue with them. For instance, PolOffs have met with former Taiwan ambassador David Hu and current Taiwan ambassador Tomas Hu several times. (See Reftel B.) PolOffs also often have met with Taiwan DCM and military attache MG Antonio Yang, Counselor Jaime Chen, first secretary Cristobal Taur, and second secretary Trinidad Chen. DAO enjoys excellent access to MG Yang through the military attache association. Quality of the Dialogue -------------- ¶2. (C/NF) The quality and reliability of the information gleaned from our meetings with the Taiwans has been excellent. For example, Taiwan Ambassador Tomas Hu predicted April 19 that the outcome of the April 28 Oval Office meeting between President Bush and Panamanian President Torrijos would determine whether Panama would change its diplomatic relations in favor of China or maintain the status quo with Taiwan for the remainder of Torrijos's five-year term that began September 1, 2004. Hu's source was "a high Panamanian official," higher than the vice minister level. The timing of the purported change in relations was unclear, but probably following a Canal referendum in 2006. Supposedly Torrijos would raise the topic on April 28 and evaluate what he heard from President Bush. Taiwan worried that a switch in Panama's relations to the PRC could well affect Taiwan's relations with the entire Central American and Caribbean region. (POL Counselor reported the conversation by email to WHA and EAP.) Taiwans Were Correct -------------- ¶3. (C/NF) Amb. Hu's prediction was largely correct. According to POL Counselor's sources within the GOP, Torrijos concluded from his Oval Office China/Taiwan discussion that the USG would not object to Panamanian recognition of China and that recognition of China has been in President Torrijos's mind as an active possibility since that time. (Comment: POL Counselor's sources disagreed with Hu about Panama's timing of a switch in diplomatic recognition from Taiwan to China (PRC). If it should happen, Panama would wait until after passage of the US-Panama FTA, so as not to complicate matters with Congress, perhaps by the end of 2005, they maintained. The sources also confirmed that Torrijos claimed to have found "independent" funding to complete the Colon-Panama highway, which Embassy concludes to mean that China has offered to pay for the highway. Other sources have suggested that China may agree to buy Panama's banana crop. Panama's banana industry and its 20,000-30,000 banana workers have been in a state of depression since the multinational firm Chiquita left Panama several years ago. End comment.) ¶4. (S/NF) In another example, at a June 21 meeting with POL Counselor, Taiwan Counselor said that a high GOP official had told his Embassy that Panama and China are engaged in active negotiations on China recognition with Panama's commercial office chief in Beijing. Embassy has corroborated that report independently. Value of Seeking Enhanced Dialogue -------------- ¶5. (C/NF) Embassy expects to use our existing good relations with Taiwan diplomats as Department suggests, concentrating on core mutual interests, and averting sending unintended signals to the Taiwans, as Department already has noted, that our diplomacy will "tilt" toward Taiwan in the future at the expense of China. On the other hand, every Embassy interaction with the Taiwans sensitizes us to their agenda and their vested interest in spreading alarm about the PRC. As described above, the most useful information that the Taiwans have given us is information which they have volunteered. As the relationship between Taiwan and Panama has deteriorated during the past 12 months, the Taiwans tend to look more to U.S. diplomats for support and encouragement. We question whether they have a lot to say to us that they have not already said. ARREAGA