AMBASSADOR EATON DISCUSSES PANAMA CANAL EXPANSION

UNCLAS SECTION 01 OF 02 PANAMA 002200

SIPDIS

SENSITIVE

DEPARTMENT ALSO FOR WHA/CEN AND EUR/WE
SOUTHCOM ALSO FOR POLAD

E.O. 12958: N/A
TAGS: PREL EINV CMGT PM FR POL CHIEF
SUBJECT: AMBASSADOR EATON DISCUSSES PANAMA CANAL EXPANSION
WITH FRENCH AMBASSADOR

SUMMARY
--------------

1. (U) Ambassador William Eaton met with French Ambassador to
Panama Christophe Philibert on October 31, 2005. The
ambassadors discussed French interests in Panama, President
Bush,s November 6-7 visit to Panama, and French ambitions
for Panama Canal expansion. End Summary.

French Economic Interests in Panama
--------------

2. (SBU) French interests in Panama are primarily economic.
France supports expansion of the Panama Canal and plans to
participate in the expansion Amb. Philibert said, adding that
he hopes President Bush will make a statement supporting
Canal expansion during his upcoming visit. Ambassador Eaton
responded that President Bush probably would avoid making a
statement on Canal expansion, preferring to let the
Panamanians decide the Canal,s fate. Amb. Philibert said
that many of today,s massive freighters are too big for the
Canal,s 110-foot wide locks. If the Canal does not expand,
he believes, it risks becoming a regional, rather than global
canal.

French Companies On The Make
--------------

3. (SBU) Philibert said two or three French companies,
namely Tractebel Development Engineering, Coynet-Bellier,
Tehnum N.V. and Compagnie Nationale du Rhone, are working on
expansion plans and studying the viability of a third set of
locks. If the Panama Canal Authority (ACP) chooses to expand
the Canal, Philibert expects a multinational effort. French
firms face strong international competition from China,
Japan, the U.S., and various European nations vying for
expansion contracts, he added. French firms also are also
interested in the Panama City-Colonhighway project. A
Mexican construction firm, PYCSA, originally had a contract
to complete the Panama City-Colon motorway but the Panamanian
government suspended the contract after alleged violations.
French companies are interested in bidding on the contract if
it is reopened to competition.

French Tourism Declines After Air Crash
--------------

4. (SBU) French tourism suffered a blow, Philibert said, from
an August 19, 2005 plane crash in Venezuela that killed all
160 aboard, mostly tourists from French Martinique returning
from a week in Panama. The number of French tourists
visiting Panama decreased significantly after the crash.
West Caribbean Airways, which offered Martinique-Panama
charter flights, was grounded pending investigation of the
accident. There are no direct flights between Panama and
France, Amb. Philibert said.

French Consular Affairs in Panama
--------------

5. (SBU) Roughly 700 expatriate French citizens live in
Panama, with the majority married to Panamanian citizens.
The Consular Section of the French Embassy has gotten tough
on visa issuance, particularly since the implementation of
the Schengen visa, which allows travel to thirteen E.U.
countries, Iceland, and Norway. Visas to France are not
required for Panamanian citizens, but the French Embassy
accepts applications from third-country nationals, including
citizens of Colombia, Ecuador, the Dominican Republic, and
Peru. It is fairly routine for French consular officers to
investigate visa applicant,s hotel reservations and other
points of contact and deny visas on suspicion of drug
trafficking, where appropriate.

Chirac Visit Not On
--------------

6. (SBU) Amb. Philibert said rumors that Pres. Chirac will
visit Panama are unfounded. No French president has ever
visited Panama, although in his opinion, such a visit is
warranted.

Gratitude?
--------------

7. (SBU) Amb. Philibert expressed his view that the
Panamanians are at times insufficiently grateful to the U.S.
for its role in constructing the Canal. He said that he
hopes that there will be no violent demonstrations during
Pres. Bush,s visit.

EATON