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
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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
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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