FORMER SPANISH PRESIDENT AZNAR PROMOTES TRADE AND

UNCLAS SECTION 01 OF 02 QUITO 002677

SIPDIS

E.O. 12958: N/A
TAGS: PGOV ETRD PREL PINR EC
SUBJECT: FORMER SPANISH PRESIDENT AZNAR PROMOTES TRADE AND
ATTACKS POPULISM


1. (SBU) Summary: Former Spanish PM Aznar told the
Ambassador on November 22 that the situation in Latin America
is not good, and faulted the USG and Spain, the two countries
with the most influence in the region, for lacking a plan to
counter rising populism. Aznar was in Quito at the
invitation of a business forum and said his goal was to
promote liberty and free markets in the region. The
Ambassador told Aznar the USG shared his goals for the
region; the challenge was deciding how to effectively counter
rising populism in the region. Here in Ecuador, we are doing
so by helping to rebuild damaged democratic institutions.
End Summary.


2. (U) The Ambassador and PolChief met with Aznar; another
featured speaker at the business event, Chilean
parliamentarian Pablo Longueira; and Seminarium event
organizer Santiago Samper, a Chilean of long residency in
Ecuador. The meeting was organized at the invitation of
Samper, whose goal, he said, was to promote collaboration
among allies of a "neoliberal" agenda in Latin America and
against rising populist forces in the region. In Ecuador,
politics itself has become discredited, with leadership
talent shying away from politics in favor of narrow business
interests. His group, "Seminarium" had invited Aznar and
Longueria to Ecuador in an effort to promote political and
economic stability and to encourage private sector leaders to
enter the public arena to advance national interests.


3. (SBU) Aznar praised the Ecuadorian business community
initiative, and agreed that a more coordinated response was
needed to counter Chavez and other populist forces in the
region. In his view, he said, the "contemporary situation in
the continent (of South America) is not good." Democracy has
not brought prosperity to the region, he said, undermining
faith in its institutions. He faulted the lack of proper
application of liberal economic reforms, rather than the
popular conception that these reforms were themselves at
fault.


4. (SBU) Prefacing his criticism by saying he had "no
problem" with the USG, and had discussed this situation
before with his good friend, President Bush, Aznar questioned
what he perceived as a USG "lack of a Latin America policy."
The results at Mar del Plata reflect that fact, he said; it
was inconceivable to him that the USG had offered no new
proposal for the region there.


5. (SBU) Aznar said he had a much greater problem with the
policies of the current Spanish government, which "has no
interest" in collaborating with the U.S. in Latin America.
In contrast, his own Inter-American Foundation intended to
work with "whoever we can" to support the FTAA or any other
possible sub-regional trade accords, and to promote a
political "front" or alliance of forces favoring liberty and
market-based reforms. He specifically cited interest
expressed by the American Enterprise Institute in
collaborating on this mission. His current visit to Quito,
and his recent visit to Costa Rica are to promote these
causes.


6. (U) In Aznar's public remarks, he stressed many of the
same themes, without the criticism of the USG. He forcefully
argued that without political and institutional stability no
progress could be made. Using the success of the Spanish
economy under his leadership as an example, Aznar described
how market liberalization, privatization and the elimination
of private and public monopolies creates jobs. To counter
the rising populist sentiments, Aznar told the audience to
look to the most advanced countries around the world. Those
countries do not have state controlled economies, but they do
have strong institutions, open markets, fiscal policy and
independent judiciaries. He pointed out that, similar to
Ecuador, 30 years ago, Spain was a developing country under
dictatorship. Since then, with a stable democracy and the
liberal economic policies Spain had risen to join the most
developed countries in the world.


7. (SBU) Chilean deputy Longueira (UDI) lamented to the
Ambassador the effects of growing anti-Americanism in Latin
America on the region. Chavez and other populist leaders
(citing also Toledo over the Peru-Chile maritime dispute)
were generating conflict for internal political benefit. He
worried that populists like Evo Morales in Bolivia and
Chilean leftists had been boosted by the regional tendency to
reject USG motives and goodwill.


8. (SBU) The Ambassador replied that the USG is disposed to
help the region counter populist threats; the challenge is in
choosing our methods. Here in Ecuador we are doing so by
helping the GOE rebuild damaged democratic institutions, like
the Supreme Court. Political parties here, including those
on the center-right of the spectrum, lack internal democracy,
and are often part of the problem.


9. (SBU) Comment: Both Aznar and Longueira are effective
public speakers and a good counter-balance to the populist
rhetoric of Chavez and his ilk. They were largely speaking
to the choir at this event. We are looking into ways we can
use them and other foreign leaders to help spread our message
of strong, responsible, institutional democracies and free,
fair and open trade here, and recommend the Department
consider the benefits of doing the same for the region.
JEWELL