JAN. 1, 2006 ENTRY INTO FORCE HELPS CAFTA-DR IN

UNCLAS SAN JOSE 002664 SIPDIS FOR UNDERSECRETARY SHINER AND ASSISTANT USTR VARGO FROM AMBASSADOR LANGDALE ALSO WHA/CEN E ALSO FOR DEDWARDS EB FOR WCRAFT WHA/EPSC FOR KURS STATE PASS TO USTR ALSO FOR AMALITO E.O. 12958: N/A TAGS: ETRD ECIN PGOV PREL CS SUBJECT: JAN. 1, 2006 ENTRY INTO FORCE HELPS CAFTA-DR IN COSTA RICA REF: SECSTATE 188288 ¶1. (SBU) Summary. We know that USTR must make a determination soon so that it can recommend to the President when he should issue his proclamation bringing CAFTA-DR into force. Recognizing that this determination is of greater importance for countries that have already ratified, we want to highlight some less obvious consequences for Costa Rica. We believe that entry into force on January 1, 2006, rather than a later date, would help focus the GOCR,s eye on the prize and advance U.S. interests in Costa Rica. TIMING -------------- ¶2. (SBU) We are aware that a decision will be made shortly in Washington on when to recommend to the President that the U.S. bring the U.S.-Central American-Dominican Republic Free Trade Agreement (CAFTA-DR) into force. Consistent with public commentary by senior Administration officials over the past months, we have characterized January 1, 2006 as the target date for entry into force of CAFTA-DR. Costa Rican Vice Minister for Foreign Trade (COMEX),Doris Osterlof, told Econoff last week that she was under the impression from her team in Washington that the entry-into-force date might slip. While that may be wishful thinking on her part, slippage in that date would have real consequences for the ratification process in Costa Rica. We understand that not all of the countries that have ratified CAFTA-DR have implemented all of their obligations under the agreement. SLIPPAGE HURTS CAFTA-DR IN COSTA RICA -------------- ¶3. (SBU) Any slippage in the date of entry into force would likely be seen here as a vindication of President Pacheco,s go slow policy and could dash any hope of his actively pushing CAFTA-DR before he leaves office on May 8, 2006. Indeed, we believe that Pacheco would spin a delay as evidence that the U.S. will not proceed on the implementation of CAFTA-DR without Costa Rica SLIPPAGE COULD AFFECT ELECTIONS -------------- ¶4. (SBU) In addition, a later entry-into-force date could hurt those candidates in the February 5, 2006 presidential and legislative elections here who have been arguing that legislating CAFTA-DR is an urgent necessity. Conversely, if CAFTA-DR were to come into force on January 1, 2006, whether with all of the countries that have ratified the agreement or a subset thereof, the pro-CAFTA-DR forces in Costa Rica would be strengthened. An on-target entry into force would demonstrate clearly that Costa Rica is being left behind. If one or more other countries are not there on Day One, this would highlight the need for full compliance with CAFTA-DR obligations and thereby underline the importance of Costa Rica,s moving forward on its complementary implementing legislation, such as telecommunications reform. Conclusion -------------- ¶5. (SBU) For these reasons post believes that bringing the agreement into force on January 1, 2006 would advance U.S. interests in Costa Rica by indirectly keeping up the pressure on the GOCR to move CAFTA-DR forward expeditiously. LANGDALE