Identifier
Created
Classification
Origin
06ASUNCION731
2006-07-17 11:00:00
UNCLASSIFIED
Embassy Asuncion
Cable title:  

PARAGUAY: SENATOR CORNYN VISITS TRI-BORDER REGION

Tags:  OREP PGOV PREL ETRD PTER EFIN PA 
pdf how-to read a cable
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PP RUEHWEB

DE RUEHAC #0731/01 1981100
ZNR UUUUU ZZH
P 171100Z JUL 06
FM AMEMBASSY ASUNCION
TO RUEHC/SECSTATE WASHDC PRIORITY 4524
INFO RUEHBR/AMEMBASSY BRASILIA 3502
RUCNMER/MERCOSUR COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHDC
RHEHNCS/NSC WASHDC
RHMFISS/HQ USSOUTHCOM MIAMI FL
RUEAIIA/CIA WASHDC
UNCLAS ASUNCION 000731 

SIPDIS

SIPDIS
STATE FOR WHA/BSC
H PASS
NSC FOR CRONIN
TREASURY FOR OASIA

E.O. 12958: N/A

TAGS: OREP PGOV PREL ETRD PTER EFIN PA
SUBJECT: PARAGUAY: SENATOR CORNYN VISITS TRI-BORDER REGION


UNCLAS ASUNCION 000731

SIPDIS

SIPDIS
STATE FOR WHA/BSC
H PASS
NSC FOR CRONIN
TREASURY FOR OASIA

E.O. 12958: N/A

TAGS: OREP PGOV PREL ETRD PTER EFIN PA
SUBJECT: PARAGUAY: SENATOR CORNYN VISITS TRI-BORDER REGION



1. SUMMARY: Senator John Cornyn-R Texas visited the tri-border
area of Paraguay, Brazil and Argentina on July 1-3. In Brazil,
Cornyn met with Brazilian Revenue officials to discuss their
challenges in dealing with contraband and illicit goods transported
over the Friendship Bridge that connects Paraguay and Brazil. In
Ciudad del Este, Senator Cornyn met Paraguay's Attorney General
Ruben Candia Amarilla, who briefed him on key Public Ministry cases
and provided a tour of the warehouses that store seized contraband
and goods. In addition, the Senator met with SENAD anti-drug
officials, attended a lunch with business representatives from the
region, and received a tour of the bi-national Itaipu Hydroelctric
Dam. END SUMMARY.
* Paraguay's Fight Against Contraband, Crime, and Corruption


2. On July 1-3, 2006 Senator John Cornyn-R Texas accompanied by his
Foreign Affairs Advisor, Russ Thomasson, visited the tri-border
region of Paraguay and Brazil to gain a better understanding of the
region's issues and challenges. The Senator sits on several
subcommittees that provide oversight for matters involving the
region, including the Armed Services Committee's Subcommittee on
Emerging Threats and Capabilities, which he chairs, the Judiciary
Committee's Subcommittee on Immigration, Border Security, and
Citizenship, which he also chairs, and Subcommittees on Intellectual
Property and on Terrorism, Technology, and Homeland Security.
Consul General Sao Paulo Chris McMullen and one control officer from
the Consulate also accompanied the delegation. On July 2, Senator
Cornyn met with Jose Carlos Araujo, the regional director for
Brazil's combined revenue and customs agency (Receita Federal).
This meeting to be reported septel by Sao Paulo. In Ciudad del Este
(CDE),Senator Cornyn met Paraguay's Attorney General Ruben Candia
Amarilla and toured the regional offices of the Public Ministry and
its warehouses where seized contraband and goods are stored. Candia
provided the Senator with an overview of Paraguay's challenges in

combating piracy and contraband in the area. Many of the
prosecutors assigned to the region were also present to meet with
the Senator.


3. DEA Attach David Hathaway briefed Senator Cornyn on
country-specific drug trafficking issues and on the activities of
the National Anti-Drug Secretariat (SENAD) during a tour of the
SENAD office in Ciudad del Este and during a tour of the offices of
the Fiscalia (prosecutor's office). Specific issues discussed were
the improvements needed on the chain-of-custody for evidence, the
advantages of co-locating the criminal justice elements in one
dedicated location, and a needed increase of personnel dedicated to
drug investigations. Also discussed was the tendency for drugs to
leave the country via Pedro Juan Caballero and for money and
merchandise to flow into Ciudad del Este from the sale of the drugs.


* Business Community Working for Change


4. Senator Cornyn had lunch with a number of area business people,
including the Executive Director of the local affiliate of the
Paraguayan-American Chamber of Commerce, a German land owner with a
very successful fruit concentrate business, a Lebanese-origin
naturalized American citizen who exports wood moldings and other
products to the US, the Vice President of the Information Technology
Business Chamber, and the Government Affairs Director of Archer
Daniels Midland. A common theme was that Ciudad del Este is in a
state of flux, with increased enforcement by Brazil over the last
several years and declining cost and availability differentials
reducing the amount of tri-border commerce significantly. Senator
Cornyn expressed his belief that Latin America is of great
importance to the US, and that US foreign policy ought to focus more
attention on the region


5. The Lebanese-American estimated that the Lebanese population in
the area had dropped from 20,000 to around 4,000 as people have
moved elsewhere in search of better commercial opportunities. The
IT sector worked with the government and with USAID to develop a
plan to change customs procedures and the way taxes were collected
to help the industry become profitable while formalizing. The
initiative appears to be working, but developing it required
proactive engagement with the government. The German entrepreneur
has been highly successful over 20 years, but commented that she
wouldn't invest today given the numerous bureaucratic obstacles to
doing business in Paraguay and the constant risk of arbitrary
actions by the political class.


6. Comment: The diverse group of businesspeople represented at the
lunch demonstrated that legitimate business can exist and even
thrive in CDE. However, Brazil's impending transition to 100
inspection at their end of the Friendship Bridge and future GOP
policy toward wholesale commerce will largely dictate whether CDE
transitions to a mostly legal, formal economy without significant
social dislocation. End Comment.


7. The Senator ended his visit in CDE with a tour of the Itaupu
Hydroelectric Dam, where he received briefings on how the world's
second largest dam was constructed and maintained. In addition, the
tour provided information on the large amount of power that is
generated for both Paraguay and Brazil - Itaipu has the largest
generating capacity of any dam in the world (over 18 megawatts) and
electricity.


8. This cable was coordinated/cleared by Embassy Asuncion,
Consulate Sao Paulo, the Chief of the U.S. Army Liaison to the
Senate (Barbero),and the Office of Senator John Cornyn.
Cason