1. (C) While Costa Rican Foreign Minister Roberto Tovar and
Nicaraguan Foreign Minister Norman Caldera met in San Jose
September 27 to discuss the San Juan River border dispute,
the Costa Rican MFA sent the following position paper to the
U.S. and British (as current EU president) embassies. The
paper is not for release to the GON or to the public.

Begin Text:

Outline



1. Article 6 of the 1858 Treaty of Limits between Costa Rica
and Nicaragua establishes that Nicaragua has the sovereignty
and ownership of the San Juan River, but Costa Rica has on
its waters the perpetual right of free navigation for
purposes of commerce.



2. In this regard, Costa Rica acknowledges that:

a. The San Juan River belongs to Nicaragua.
b. Nicaragua possesses the sovereignty on the River.



3. However, Costa Rica has rights on that River, which
Nicaragua does not recognize. Some of those Costa Rican
rights are:

a. the obligation (for Nicaragua) to allow Costa Rican boats
and their passengers to navigate freely and without
impediment on the San Juan River for commercial purposes,
including the transportation of passengers and tourism;

b. the obligation (for Nicaragua) not to impose any charges
or fees on Costa Rican boats and their passengers for
navigating on the River;

c. the obligation (for Nicaragua) to allow Costa Rica the
right to navigate the San Juan River in official boats for
supply purposes, exchange of personnel of the border posts
along the right bank of the San Juan River, with their
official equipment, including the necessary arms and
ammunitions, and for the purposes of protection, as
established in the pertinent instruments.



4. In light of the evident differences in the positions
sustained by both countries, which have not been able to be
resolved by diplomatic means, or through the peaceful dispute
settlement mechanisms, the most adequate alternative among
peace loving and respectful nations is to submit the issue
before the International Court of Justice. In this regard,
the Government of Nicaragua itself has expressed that "...the
recourse of the peaceful mechanisms to resolve disputes
between states is neither a hostile nor an unfriendly act.
On the contrary, the recourse to the International Court of
Justice is totally in accordance with the will of nations to
live in peace, security and harmony".



5. Costa Rica is forced to present the application to the
International Court of Justice before the 23rd of October,
due to the fact that Nicaragua has presented a reservation to
the Court's Jurisdiction which excludes the main legal
instruments upon which Costa Rica bases its case.



6. To implement a "tax" to the Costa Rican exports to
Nicaragua, as has been announced by Nicaraguan legislators,
is not a valid reaction to the peaceful resolution of
differences and does not conform to today's international
realities. The consequences of such action could be:

a. The stagnation of the Association Agreement between
Central America and the European Union.
b. The stagnation of the Central American Customs
Integration.
c. May jeopardize the CAFTA, which does not allow this type
of measure.
d. Might put in danger the survival of medium and small
Costa Rican and Nicaraguan businesses, including the loss of
jobs.



7. There is no possibility to extend the Alajuela 2002
agreement. The international advisors have indicated that we
could jeopardize our rights, since for 3 more years Costa
Rica would not be able to exercise them.



8. Costa Rica is willing to take the case to arbitration, if
Nicaragua accepts it.

End text



2. (C) MFA adviser Sergio Ugalde stressed to acting DCM that
there is no possibility of extending the three-year truce
(point 7 in the position paper) because the legal and
political risks are unacceptable. He said that the legal
risk is that Costa Rica would be accepting through
acquiescence that it has no right of free navigation on the
San Juan. The political risk, he said, is that Tovar would
be driven out of office. He noted that 11 members of the
Legislative Assembly wrote Tovar a letter on September 22
urging a tough GOCR stance on the San Juan, and that former
foreign minister Rodrigo Madrigal Nieto lambasted Tovar in a
September 24 op-ed piece for signing the three-year truce in
the first place.


3. (C) Ugalde said the MFA rejects the notion that Costa
Rica's going to the ICJ will cause the Bolanos government to
fall, noting that the GOCR has been Bolanos's biggest
supporter. Ugalde claimed that the GON's strategy is to
"play the crisis card" to get what they want, but no one has
demonstrated how or whether a case before the ICJ, where
Nicaragua has already filed a motion, will affect the balance
of political forces in Nicaragua.
FRISBIE