Identifier
Created
Classification
Origin
05TEGUCIGALPA1577
2005-08-01 14:21:00
UNCLASSIFIED
Embassy Tegucigalpa
Cable title:  

MEDIA REACTION ON CAFTA, JULY 29, 2005

Tags:  OIIP KPAO ETRD HO USTR 
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This record is a partial extract of the original cable. The full text of the original cable is not available.
UNCLAS SECTION 01 OF 02 TEGUCIGALPA 001577 

SIPDIS


DEPT. FOR WHA/PD; IIP/G/WHA DIPASQUALE; AND IIP/T/ES
DEPT. FOR EB/TPP DCLUNE, WHA/EPSC AND WHA/CEN
DEPT. PASS USTR

E.O. 12958: N/A
TAGS: OIIP KPAO ETRD HO USTR
SUBJECT: MEDIA REACTION ON CAFTA, JULY 29, 2005


UNCLAS SECTION 01 OF 02 TEGUCIGALPA 001577

SIPDIS


DEPT. FOR WHA/PD; IIP/G/WHA DIPASQUALE; AND IIP/T/ES
DEPT. FOR EB/TPP DCLUNE, WHA/EPSC AND WHA/CEN
DEPT. PASS USTR

E.O. 12958: N/A
TAGS: OIIP KPAO ETRD HO USTR
SUBJECT: MEDIA REACTION ON CAFTA, JULY 29, 2005



1. On 07/29 the Tegucigalpa-based liberal daily "La
Tribuna" published an editorial entitled "Tight." "In a
tight vote, 217 vs. 215, the United States House of
Representatives approved the Free Trade Agreement for
Central America and the Dominican Republic. The Bush
administration barely succeeded, after a struggle in which
the President himself had to personally appeal to various
members of Congress. He finally won the support of some
doubting Republicans and got 15 Democrats to vote against
party lines."

"The reaction to the news in Central American countries has
been mixed. There is jubilation in the government spheres
that negotiated the agreement and in the industrial sectors
that are already calculating the added benefits for their
companies. But there is distrust within the labor unions,
which believe that the FTA will negatively affect the most
vulnerable sectors of the economy, fundamentally in the
countryside. Political opponents are also distrustful, as is
the case among the left wing fronts in Nicaragua and El
Salvador."

"Now the argument that proponents will be hammering home in
those countries where it has not been ratified is that if it
is not done, their country will be left behind. There is no
doubt that a lot of investment will be transferred to those
countries whose markets are part of the FTA. And even more
in those countries in which there is adequate preparation
for competition. When will we start here?"


2. On 7/29, the San Pedro Sula-based liberal daily
"Tiempo" published an editorial entitled "Now What?" "We now
have a Free Trade Agreement with the United States and this
is just the beginning. Now it is up to the politicians,
government officials, industrialists, and labor to take the
necessary actions to meet the challenge, in other words, to
compete openly in a free trade zone."

"For Central America, the passing of the CAFTA-DR agreement
is important and brings the hope of improving our industrial
and agricultural export capabilities. It also offers the
possibility of containing emigration to the north and
increasing sales to the vast and affluent U.S. market. This
will only be possible with elevated productivity of high
quality products at competitive prices."

"The ball is now, as they say, in the court of the Central
American `northern triangle.' Honduras has to implement
innovative and effective economic policies in order to
improve its productive infrastructure, intelligently exploit
its natural resources, incorporate new technologies and new
ways of corporate management, reform its labor laws, and
prepare the workforce to be competitive."

"Up to now, as far as we know, none of this has been
seriously considered by the political parties. On the
contrary, we are witnessing an improvisation and complete
ignorance of our reality, especially in economic and social
issues."


3. On 7/29, the Tegucigalpa-based moderate daily "El
Heraldo" published an editorial titled "Let's Compete." "The
narrow approval of the Free Trade Agreement with Central
American and the Dominican Republic by the United States
Congress represents an irrefutable triumph for President
George W. Bush, who invested all his political capital in
the project. However, if we are capable of capitalizing on
it, in the long run, it will be more advantageous for the
people of Central America and the Dominican Republic."

"The pretext used by those conservatives in the United
States who oppose CAFTA is the fear that the transnational
corporations will move their assembly plants in search of
lower wages and that this will cause unemployment.
Meanwhile, the liberals are aligned with the social
movements in the signatory countries, arguing that the
agreement does not have enough safeguards for labor and that
it will become an instrument of exploitation."

"But the truth is that, besides the fact that countries like
Honduras need massive sources of employment to fight
poverty, CAFTA not only represents the possibility of
increased foreign investment, but it will also give Honduran
producers access to the most important market in the world.
This will in addition generate more employment and
contribute towards creating national wealth."

"In the end, the benefits that the people of Central America
can receive from CAFTA depend 100% on the capacity of their
governments and producers to increase competitiveness. In
other words, the opportunity will be available starting next
year: it all depends on us and if we know how to take
advantage of it."


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