PARAGUAY POLITICAL AND ECONOMIC UPDATE, NOVEMBER

C O N F I D E N T I A L ASUNCION 001162

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STATE FOR WHA/BSC
INL/LP (JIM HIDES)
EB/IFD/OIA
STATE PASS TO USAID FOR LAC/AA
STATE PASS TO USTR FOR LYANG
NSC FOR SUE CRONIN
TREASURY FOR OSIA MAUREEN WAFER
TREASURY FOR OTA WARFIELD, VAN KOCH, MILLAR
COMMERCE FOR ITA SARAH COOK
SOUTHCOM FOR POLAD

E.O. 12958: DECL: 11/16/2026
TAGS: PGOV PHUM PREL SMIG KWMN ECON EAID
SUBJECT: PARAGUAY POLITICAL AND ECONOMIC UPDATE, NOVEMBER
10 - 17, 2006


Classified By: DCM Michael J. Fitzpatrick; Reasons: 1.4(b),(d).


1. (U) SUMMARY:
-- November 19 Elections May Cause Job Loss
-- Cuban Refugees Arrive
-- TIP Update
-- Making the Balance Sheets Work


NOVEMBER 19 ELECTIONS MAY CAUSE JOB LOSS


2. (C) The Superior Elections Tribunal (TSJE) has come under
a considerable amount of criticism in recent days regarding
their ability to conduct this Sunday's Municipal elections.
TSJE Director of Technical Information, Ricardo Lesme Dalles,

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and TSJE Director of Public Affairs, Liliana Benitez, told
PolOff November 17 much of the criticism is over the loading
of candidates into the electronic voting machines. Lesme
claimed some of the political parties had given the TSJE
incorrect spellings of candidate names and/or photographs
where incorrect. The TSJE loaded that information into the
systems and had to go back and correct all of that data.
(NOTE: Lesme's position will be reviewed on Monday by the
TSJE, according to Benitez. Benitez believes that he will

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not survive that review because of the enormous political
pressure from Sen. Galaverna and other leaders within the
Colorado Party. Lesme has worked in the Technical
Information Office for 11 years. END NOTE).


3. (C) Lesme indicated that he expects the results of the
electronic ballots to be ready for release at 7:00 pm.
However, in the remaining areas with both electronic and
paper ballots, the results will not be released until after
every vote has been counted. Benitez noted that the TSJE has
150 political party observers and 22 international observers,
including representives from the Mercosur countries, El
Salvador and the Dominican Republic (the latters are
considering a move to electronic balloting).

CUBAN REFUGEES ARRIVE


4. (U) Seven Cuban refugees arrived in Asuncion November 14
and will be resettled in Paraguay with the assistance of the
Committee of Churches, a local NGO. The DCM met with
International Organization for Migration (IOM) Program
Coordinator Dr. Luis Bogado-Poisson November 15 to discuss
the arrival of the Cubans and to thank IOM for their support
and efforts. (NOTE: The Paraguayan Consulate in Sao Paolo
granted courtesy visas (no charge) to the Cubans. The Cubans
requested asylum upon arrival in Paraguay. The AMB is
sending a thank you letter to the MFA for their support in
relocating the Cuban refugees and will meet with the FM next
week. END NOTE).

TIP UPDATE


5. (C) Paraguay's inability to gather accurate data on the
numbers of victims of trafficking in persons continues
leaving much of the NGO community to question how the
Paraguayan government registers victims. According to
Graciela Zelaya, Director of the Trafficking in Persons
Center and the Office of Women,s Support Services in the
Secretariat of Women's Affairs, there are 16 new adult

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victims of trafficking as of September 2006. Also, Rosa
Otazu, Director of Policy in the Secretariat of Children and
Adolescents, told POLOFF that there have been 5 minor victims
of trafficking this year, all for sexual exploitation.
Zelaya stated that most of the victims were from the interior
of the country and transported to the cities of Asuncion,
Encarnacion and Ciudad del Este before being trafficked
across the borders into Brazil and Argentina, some with
planned destinations in Spain and the United States.
(COMMENT: Global Infancia, a local NGO, recently reported
they identified 43 new adult victims and 11 new minor victims
of trafficking since January 2006. This continues to raise

serious questions of the government's ability to adequately
account for the "true" number of victims. POLOFF has
consulted with the GOP on this topic and recently
commissioned a local IT firm to create a system that can
monitor the GOP caseload. The firm will release their
recommendations to Post at the end of November. END
COMMENT).

MAKING THE BALANCE SHEETS WORK


6. (U) The World Bank recently sent a team of experts to
begin to conduct the first Public Expenditure and Financial
Accountability Report (PEFA) for Paraguay. The PEFA is
designed to assess and develop essential performance
measurements in order to reform the public expenditure and
procurement system as well as foster financial
accountability. According to U.S. Treasury Dept Resident
Budget Advisor, the process is a year-long review of the
public finances of Paraguay. The World Bank will meet next
week with donor organizations to discuss how the team will
conduct its work. (NOTE: Some of the donor groups include:
the InterAmerican Development Bank, USAID, and the European
Union representative. END NOTE).



CASON