COSTA RICAN LABOR UNIONS LOOK FOR WAYS TO COMBAT

UNCLAS SECTION 01 OF 02 SAN JOSE 001712

SIPDIS

SENSITIVE

DEPT FOR WHA/CEN BBOYNTON

E.O. 12958: N/A
TAGS: ELAB ETRD CS
SUBJECT: COSTA RICAN LABOR UNIONS LOOK FOR WAYS TO COMBAT
CAFTA-DR

REF: A. 04 SAN JOSE 2628


B. SAN JOSE 1153

C. SAN JOSE 944


1. (SBU) Summary: Costa Rica's labor unions, flush from their
earlier successes in intimidating President Abel Pacheco,
recently fell back to earth when planned demonstrations
against the Central American-U.S.-Dominican Republic Free
Trade Agreement (CAFTA-DR) fizzled. Now, with possible
adoption and implementation of the trade agreement looming,
the somewhat-humbled unions are joining with their regional
counterparts to redefine their message and mission. While
not abandoning their vehement opposition to CAFTA-DR and free
trade agreements in general, there are some indications that
the unions are gradually coming to terms with the inevitable
adoption of multiple free trade agreements, and are shaping
their upcoming agenda to regain a legitimate, participatory
role in determining Costa Rica's free trade policy. End
Summary.

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FROM LIMELIGHT TO SEARCHLIGHT: LOOKING FOR LABOR'S ROLE
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2. (SBU) During President Abel Pacheco's term of office, none
of his political adversaries have been more opportunistic or
more successful at intimidating the President than the
country's public sector labor unions. On numerous occasions,
Pacheco has caved in to union demands in the face of large
strikes, even in cases where courts had ruled the strikes
illegal. With each political victory, union leaders felt
their power increasing, and became bolder in their opposition
to Pacheco's policies (Reftel A). Thanks to his charismatic
leadership and constant media exposure, Albino Vargas,
president of the National Association of Public and Private
Employees (ANEP),became a minor celebrity. Thus, from the
moment of its introduction, Vargas and other union leaders
brashly denounced CAFTA-DR, contending that it would result
in high unemployment, deterioration of public services,
inflation and massive industry shifts, and would further
exacerbate perceived labor abuses.


3. (SBU) Despite acceptance of CAFTA-DR by the general
public, labor leaders confidently promised Pacheco that they
would muster thousands to protest should he present the
agreement to the Legislative Assembly for debate. True to
his history, and despite his initial support for the
agreement, Pacheco immediately began to waver. Afraid of
widespread strikes and mass demonstrations, Pacheco has for
the past year looked for any opportunity to postpone sending
CAFTA-DR to the legislative assembly for approval.


4. (SBU) In April 2005, however, labor leaders went too far
by targeting Oscar Arias, front-runner for president in next
year's elections and an ardent CAFTA-DR supporter. In their
anti-CAFTA-DR zeal, labor leaders stated that they would not
recognize an Arias victory at the polls (Reftel B). This
message did not resonate well a population proud of its
democratic traditions, and ultimately backfired. The
unionists latest attempt (in May) to flood the streets with
angry marchers failed, with small, disheartened groups that
disappeared at the first sign of rain (Reftel C). Recent
polls show a majority of Costa Ricans support CAFTA-DR, and
events have shown that those who don't support the deal have
not been able to make good on their threats to "take it to
the streets."


5. (SBU) With U.S. Congressional approval of CAFTA-DR and
increasing pressure on President Abel Pacheco to present the
treaty for Costa Rican legislative consideration, Costa
Rica's labor organizations are struggling to find a role to
play in the debate. While the unions have never wavered in
their opposition to CAFTA-DR, and continue to rail against it
with every opportunity, the only person who appears to be
really taking them seriously is President Pacheco. It is
difficult to say whether declining opposition to CAFTA-DR is
due to an on-going backlash at the demagoguery of certain
labor leaders, media fatigue, or to a growing understanding
of globalization and a desire not to be left behind.
Whatever the reason, as their audience dwindles, the labor
organizations are struggling to regain their hold on the
public's attention.

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MISERY LOVES COMPANY: CA LABOR UNIONS MEET, REFOCUS
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5. (SBU) Given the context in which it was convened, many
expected grand statements of solidarity to emerge from the
July 12-13 conference of Central American labor leaders,
organized by the Central American Common Labor Platform
(PSCC) and held in San Jose. However, the only sign that
such a meeting even occurred was a single article in national
daily newspaper "Prensa Libre," which detailed plans for a
Central American Labor Summit in October, with others to
follow through the end of the year. Puzzled by the lack of
public statements to emerge from the conference, Poloff
contacted Edgar Morales, deputy secretary general of ANEP.
According to Morales, the chief purpose of the July
conference was simply to lay the groundwork for the October
summit. He stated that the October meeting would include not
just regional labor leaders, but industry and political
invitees as well. While CAFTA-DR is an intended topic of
discussion, Morales stated that the principal theme will be
twenty years of unfair labor practices in all the Central
American countries. Also on the agenda are free trade
policies in general, workers' rights, and International Labor
Organization (ILO) conventions and their implementation.


6. (SBU) Predictably, union leaders have responded to U.S.
Congressional approval of CAFTA-DR with dismay and promises
to continue fighting the good fight. In a conversation with
Poloff, Rodrigo Aguilar, president of one of Costa Rica's
largest labor organizations, the Rerum Novarum Workers'
Confederation, expressed his hope that President Pacheco's
"Commission of Eminent Persons" will recommend against
implementation of CAFTA-DR. Aguilar believes that Pacheco
will resist pressure to send the treaty to the legislature
until after the commission has rendered a decision; Aguilar
concedes, however, that no one has yet been able to
accurately predict what Pacheco will do. According to
Aguilar, leaders of all Costa Rica's major labor
organizations will be convening on Tuesday, August 2, to
discuss strategy, and will release details to the public
sometime after August 3. Albino Vargas, head of ANEP, told
the press that regardless of Congressional approval of
CAFTA-DR, his organization would continue its fight against
the treaty. Both Vargas and Aguilar reiterated their
commitment to organize large demonstrations upon the
agreement's presentation to the Legislative Assembly.

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COMMENT
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7. (SBU) Now that the U.S. Congress has blessed CAFTA-DR,
President Pacheco will be under increasing pressure to
present it to the Legislative Assembly. Even if Pacheco
decides not to act, the February 2006 elections will serve as
a public referendum on CAFTA-DR, in which case the unions'
successful intimidation of Pacheco could backfire on them.
Oscar Arias has already signaled his intention to fight for
adoption of CAFTA-DR, and if he wins convincingly, he will
certainly follow through with his plan to present the treaty
for legislative approval. With adoption and implementation
growing more likely, the unions have to make a decision:
continue to kick against the tide of globalization and free
trade, or work constructively with the government to have a
hand in equitable implementation.
KAPLAN