COLOMBIA'S FRUSTRATION WITH FTA DELAYS

C O N F I D E N T I A L SECTION 01 OF 02 BOGOTA 004066 SIPDIS E.O. 12958: DECL: 05/05/2015 TAGS: ETRD PREL CO FTA USTR SUBJECT: COLOMBIA'S FRUSTRATION WITH FTA DELAYS REF: A) BOGOTA 4004 B) BOGOTA 2283 Classified By: DCM Milton K. Drucker for Reasons 1.4 (b&d). ¶1. (C) Summary: The GOC is concerned over what it perceives as bad faith negotiating on the part of mid-level USTR officials. While senior Colombia trade officials have generally been reserved in public statements about the status of the FTA final texts, recent press reports indicate the GOC is running out of patience. At the request of the GOC, the final FTA texts may soon be published, but without the agriculture chapter. Senior USTR and GOC officials will meet on May 9 to review descrepencies in the agriculture chapter, after lower-level eforts to reconcile the texts were not successful. A quick reconcilliation of the ag chapter will ease critics' suspicions that the U.S. and GOC negotiators are hiding provisions deep within the agriculture text. During this period of increased tension in the Andean Community, our FTAs with Colombia and Peru represent an attractive alternative to other regional influences. End Summary. -------------- Delays -------------- ¶2. (C) Post and USG agencies told the GOC soon after FTA negotiations were completed in February that the verification of the FTA texts was a time consuming process. The GOC initially had hoped to quickly complete the verification of texts and move toward the signing, U.S. Congressional notification, and ratification of the agreement. GOC officials waited patiently for the USTR version of the text, but as March gave way to April, Trade Minister Botero began to privately and then publicly express concern over the delay. After Holy Week in mid-April, GOC trade officials reported that President Uribe, who has made the FTA an important plank of his reelection campaign, was having trouble defending the agreement in Colombia,s congress without a finalized text. The fact that a majority of the U.S. text was ready for exchange and only the agricultural text was keeping the process from moving forward raised familiar concerns among Colombia,s protectionist agriculture sector. -------------- Differences -------------- ¶3. (C) On April 26, USTR transmitted to Colombia the U.S. version of the final text. While initially pleased they finally had the text, the GOC quickly identified five (in their view) significant discrepancies in the agriculture text. On May 2, the GOC and USTR held a conference call to discuss the verification of the FTA texts. According to the GOC, the conversation did not go well. Discouraged by the lack of progress at the working level in resolving these differences, Minister of Agriculture Andres Arias identified the following areas of concern in a May 3rd letter to USTR Ambassador Crowder: -- definitions related to the agreement on chicken leg quarters -- the U.S. alternative proposal concerning administration of the TRQ on rice and chicken leg quarters through the use of an export trading company -- reference to the Certificate of Quota Eligibility in the administration of the sugar quota -- differences in growth rates of the crude soy bean oil and variety meats, along with safeguard measures on spent fowl and beans -- other tariff line and text discrepancies In the letter, Minister Arias requested a meeting with Ambassador Crowder to resolves these differences, which will take place on Tuesday, May 9 in Washington. -------------- Colombia Questions Our Good Faith -------------- ¶4. (C) The delay in passing along the U.S. FTA text, the differences found in the agricultural chapters, and the USG,s perceived lack of attention to Colombia,s concerns have raised the public profile of what is normally a quiet government-to-government review of a negotiated agreement. During the week of May 2, Senior Colombian trade officials were called before members of the Colombian Congress to respond to questions concerning the delay in publication of the FTA texts. During these sessions, Trade Minister Botero and Agriculture Minister Arias reported that differences in the USG version of the agriculture text were holding up the verification process. The Colombian press seized upon this testimony and generated a number of reports accusing the U.S. of negotiating in bad faith through attempts to renegotiate the most sensitive areas of the agriculture deal. -------------- Concerns Merit Press Play -------------- ¶5. (U) After the initial flurry of reporting on the end of negotiations and the GOC's roll out of the agreement (Ref B), the press is now questioning the delay in publishing the FTA text. These reports and others (Ref A) concerning descrepencies in the agriculture text are providing FTA critics an opportunity to attack the negotiation and verification process as lacking transparency. Several liberal party politicians have come out against the FTA in press, suggesting the delay in publishing the text is an inidcation the U.S. and GOC are hiding sensitive provisions from the public. The verification of the FTA text is front-page news in Colombia, and a critical mass of negative local reporting during this stage of the FTA process could affect ratification. -------------- Way Forward -------------- ¶6. (C) At the request of the GOC, the final FTA text, excluding the agriculture chapter, will likely be published early in the week of May 8. FTA critics and press reports will likely focus on the absence of the agriculture chapter as confirmation that the two parties are far apart on sensitive issues that were suposedly concluded in February. Colombian officials hope the May 9 meeting with Ambassador Crowder will quickly resolve their concerns over discrepancies found in the ag chapter and quiet public debate of U.S. intentions. The GOC will then focus on the signing of the FTA and ratification of the agreement through Colombia,s congress. President Uribe will likely kick off the national debate concerning the FTA when he opens the new session of Congress on July 20. The recent congressional elections resulted in a significant number of new legislators, and the GOC is preparing FTA-related materials public relations strategies designed to win the support of these new members of congress. Parties that support President Uribe did very well in the election, and Ministry of Commerce officials are confident they will win ratification, perhaps as early as the end of this year (Note: There is no required consultation period between the signing and ratification of the agreement. Debate on the FTA can begin in Colombia,s congress without a signed version of the agreement.) -------------- Comment -------------- ¶7. (C) Colombian trade officials are frustrated with the USG. The GOC considers itself an important ally of the U.S. and one of the region,s strongest supporters of free trade. They are puzzled by a perceived lack of USG interest in moving forward with their agreement. Given the recent turmoil in the Community of Andean Nations and the nationalization of the Bolivian gas fields, moving forward as quickly and collaboratively as possible on this FTA would provide an attractive alternative vision for the future of the region. Publishing the FTA text without the agriculture chapter will raise even more questions about U.S. intentions. WOOD