PARAGUAY POLITICAL AND ECONOMIC UPDATE, AUGUST 26

UNCLAS ASUNCION 000890

SIPDIS

SIPDIS

STATE FOR WHA/BSC AND 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: N/A
TAGS: PGOV PHUM PREL KCRM PA
SUBJECT: PARAGUAY POLITICAL AND ECONOMIC UPDATE, AUGUST 26
- SEPTEMBER 1

REF: A. ASUNCION 0852

B. ASUNCION 0667


1. (U) SUMMARY

-- TFCA Awaits Duarte Approval
-- 50,000 March for Children
-- Breakout at Emboscada Prison

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TFCA Awaits Duarte Approval
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1. (U) The Chamber of Deputies approved the Tropical Forest
Conservation Act (TFCA) agreement on August 31. The Senate
unanimously adopted the agreement on August 17. The
agreement now awaits attestation and signature from President
Duarte. The TFCA authorizes USD 7.4 million in debt
reduction to Paraguay - zeroing out Paraguay's remaining
bilateral debt - if the GOP meets its obligation to provide
the equivalent funding over the next 12 years to support
grants to conserve and restore important tropical forest
resources in the southern corridor of the Atlantic Forest of
Alto Parana. In addition, special attention will be given to
enhancing protected areas in the San Rafael National Park
Reserve. (NOTE: The Ambassador is sending a letter to
Finance Minister Ernst Bergen to congratulate the GOP on the
passage and requests a meeting to discuss USG suggestions for
private NGO members of the seven person board that will
oversee the TFCA program. END NOTE.) (ref. A)

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50,000 March for Children
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2. (U) More than 50,000 people marched for the rights of
children on August 27. The event was sponsored by The
Dequeni Foundation, a local NGO for children. The purpose of
the march was to focus national attention on the health,
education and protection of children. Cynthia Bendlin, a
longtime member of the group and local representative for the
International Organization for Migration (IOM),advised that
the organization was founded more than 22 years ago to
promote the rights of children. Bendlin also remarked that
more than 28,000 people signed a a petition to promote the
same children's issues and that the petition will be
presented to Congress after making rounds of the Departments
for more signatures. UNDP and other foreign aid officials
have issued critical remarks about the government's focus on
reelection as compared to its relative neglect of "social"
issues including the welfare of children.

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Breakout at Emboscada Prison
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3. (U) Sixteen prisoners escaped from the Emboscada maximum
security prison, located in the Cordillera Department,
passing several guard stations, during the evening of August

26. It appears guards where paid USD 5,000 to look the other
way. Five of the prisoners were captured a few hours later
(3 in Arroyos y Esteros and 2 in Nuevo Colombia). Another
escapee was captured on August 29 in the city of Paraguari.
Ten prisoners remain at large. Derlis Cespedes, the Minister
of Justice and Labor, in response to this incident removed
the Director of Emboscada Prison, Angel Cardozo, and has yet
to name a new director. (NOTE: Emboscada holds 7 captives of
the Anti-Narcotics Secretariat (SENAD) but none escaped. END
NOTE.)


4. (U) Attempted and actual prison escapes are common in the
Paraguayan prison system with prison guards often implicated.
In late June, there was an attempted escape at Tacumbu
prison, located just outside Asuncion, using explosives,
which weakened an outside reinforced wall. Military
personnel briefly took control of that prison. Guards were
also implicated in this incident as well. (ref. B)



CASON