AMCHAM BOARD OF DIRECTORS LUNCHEON IN HONOR OF AMBASSADOR

UNCLAS BUENOS AIRES 002588 SIPDIS SIPDIS E FOR THOMAS PIERCE, WHA FOR WHA/BSC AND WHA/EPSC PASS NSC FOR JOSE CARDENAS PASS FED BOARD OF GOVERNORS FOR PATRICE ROBITAILLE EX-IM BANK FOR MICHELE WILKINS OPIC FOR GEORGE SCHULTZ AND RUTH ANN NICASTRI PASS USTR FOR SUE CRONIN AND MARY SULLIVAN TREASURY FOR ALICE FAIBISHENKO USDOC FOR 4322/ITA/MAC/OLAC/PEACHER US SOUTHCOM FOR POLAD E.O. 12958: N/A TAGS: ECON KTEX AR SUBJECT: AMCHAM BOARD OF DIRECTORS LUNCHEON IN HONOR OF AMBASSADOR TONY WAYNE SENSITIVE BUT UNCLASSIFIED (NOT FOR INTERNET DISTRIBUTION) ¶1. (SBU) SUMMARY: ON THURSDAY, OCTOBER 9, THE AMERICAN CHAMBER OF COMMERCE BOARD OF DIRECTORS HOSTED A LUNCHEON IN HONOR OF AMBASSADOR WAYNE TO WELCOME HIM TO ARGENTINA AND BRIEF HIM ON THE BUSINESS CLIMATE AND THE CONTRIBUTION U.S. COMPANIES HAVE HISTORICALLY MADE AND CONTINUE TO MAKE IN ARGENTINA. OVERALL, THE PARTICIPATING EXECUTIVES SAID THAT BUSINESS WAS GOING WELL, BUT ALSO INDICATED THAT ARGENTINA WOULD NEED TO STRENGHTEN ITS COMPETITIVE EDGE IN A NUMBER OF KEY AREAS IN ORDER TO COMPETE MORE EFFECTIVELY FOR ADDITIONAL MAJOR INVESTMENTS BY THEIR PARENT COMPANIES IN THE FUTURE. NOT SURPRISINGLY, SOME WERE CHAFFING UNDER PRICE CAPS (FORMAL AND INFORMAL). THE AMBASSADOR OFFERED STRONG EMBASSY SUPPORT FOR THE BUSINESS COMMUNITY AND EXPRESSED APPRECIATION FOR THE IMPORTANT ROLE THEY PLAY IN THE ECONOMIC AND SOCIAL WELLBEING OF ARGENTINA. END SUMMARY. ¶2. (SBU) ON THURSDAY, OCTOBER 9, THE AMERICAN CHAMBER OF COMMERCE BOARD OF DIRECTORS HOSTED A LUNCHEON IN HONOR OF AMBASSADOR WAYNE TO WELCOME HIM TO ARGENTINA AND BRIEF HIM ON THE BUSINESS CLIMATE AND THE CONTRIBUTION U.S. COMPANIES HAVE HISTORICALLY MADE AND CONTINUE TO MAKE IN ARGENTINA. PARTICIPATING COMPANIES INCLUDED LOCKWOOD GREENE, UNITED AIRLINES, MERCK, PRICEWATERHOUSECOOPERS, GE, CITIBANK, LOCKHEED MARTIN, PROCTOR & GAMBLE, FORD, GM, MCDONALD'S, WAL-MART, EXXONMOBIL, HEWLETT PACKARD, COCA-COLA, DOW, SHERATON HOTELS/STARWOOD, 3M, CHEVRON TEXACO, ELI LILLY, CARGILL, CMS, AMERICAN EXPRESS, PRUDENTIAL, AND PHILIP MORRIS. MOST OF THE COMPANIES WERE REPRESENTED BY THEIR CEOS, MANY OF WHOM HAVE REGIONAL RESPONSIBILITIES FOR THE SOUTHERN CONE. COMMERCIAL COUNSELOR BRIAN BRISSON AND ECONOMIC COUNSELOR DOUGLAS CLIMAN ALSO PARTICIPATED. ¶3. (SBU) ON THE WHOLE, THE COMPANIES INDICATED THAT THEY WERE DOING FAIRLY WELL IN THE CURRENT ECONOMIC ENVIRONMENT AND SAID THAT THEY COULD NEVER HAVE IMAGINED WHEN THE ECONOMIC CRISIS BEGAN FOUR YEARS AGO THAT THEY WOULD BE DOING SO WELL TODAY. IT WAS CLEAR THAT THE �A;FORMAL AND INFORMAL PRICE CONTROLS AND CAPS WERE NOT POPULAR. OTHER CONCERNS THAT WERE MOST OFTEN VOICED HAD TO DO WITH FEARS OF AN EVENTUAL SHORTAGE OF HYDROCARBONS AND ELECTRIC POWER, INFLATION IN THE MEDIUM AND LONG TERM, AND THE STABILITY AND PREDICTABILITY OF REGULATIONS THAT HAVE AN IMPACT ON THEIR OPERATIONS IN ARGENTINA. THEY EXPRESSED A STRONG DESIRE TO DO ALL THEY COULD TO INCREASE FOREIGN DIRECT INVESTMENT IN ARGENTINA BY THEIR PARENT COMPANIES SO THAT ARGENTINA COULD PLAY A BIGGER ROLE IN THE GLOBAL ECONOMY AND GENERATE GREATER INCOME AND OPPORTUNITIES FOR THE ARGENTINE LABOR FORCE. NEVERTHELESS, THEY ALSO SAID THAT THE ARGENTINE SUBSIDIARIES OF THEIR COMPANIES HAVE TO COMPETE AGAINST THE SUBSIDIARIES THAT THEIR COMPANIES HAVE IN OTHER COUNTRIES FOR NEW GLOBAL INVESTMENT PROJECTS. THE EXECUTIVES SAID THAT COMPETITION WAS VERY STRONG FOR NEW PROJECTS AND THAT RESOLUTION OF THE ABOVE MENTIONED CONCERNS WOULD GREATLY ENHANCE THEIR ABILITY TO PROMOTE ARGENTINA AS A DESTINATION FOR INVESTMENT BY THEIR PARENT COMPANIES IN NEW PROJECTS. THEY ALSO EXPRESSED AN INTEREST IN SEEING THE GOA INCREASE ITS GLOBAL COMMERCIAL ENGAGEMENT AS A WAY OF IMPROVING THEIR ABILITY TO UTILIZE ARGENTINA AS A REGIONAL AND INTERNATIONAL PRODUCTION AND SERVICE PLATFORM. ¶4. (SBU) THE AMBASSADOR EXPRESSED HIS WILLINGNESS TO DO ALL THAT HE COULD DO TO ENGAGE THE GOA IN A DIALOGUE AIMED AT STRENGTHENING THE COUNTRY'S COMPETITIVENESS, AS WELL AS TO HIGHLIGHT TO THE GOVERNMENT AND THE GENERAL PUBLIC THE IMPORTANT CONTRIBUTIONS U.S. COMPANIES HAVE MADE TO ARGENTINA'S ECONOMIC DEVELOPMENT AND RECOVERY. THE AMBASSADOR ALSO CONGRATULATED THE FIRMS FOR THEIR COMMITMENT TO SOCIAL SERVICE NOTING THAT HIS FIRST PUBLIC EVENT WAS THE AMCHAM'S CORPORATE CITIZENSHIP AWARDS CEREMONY ON NOVEMBER 7. THE FIRMS SAID FOR THOMAS PIERCE, WHA FOR WHA/BSC AND WHA/EPSC PASS NSC FOR JOSE CARDENAS PASS FED BOARD OF GOVERNORS FOR PATRICE ROBITAILLE EX-IM BANK FOR MICHELE WILKINS OPIC FOR GEORGE SCHULTZ AND RUTH ANN NICASTRI PASS USTR FOR SUE CRONIN AND M THEY APPRECIATED THE EMBASSY'S SUPPORT. THE AMBASSADOR ALSO TOLD THE COMPANIES THAT HE IS INTERESTED IN VISITING THEIR COMPANIES AND BECOMING MORE FAMILIAR WITH THEIR ARGENTINE OPERATIONS. HIS FIRST TWO VISITS WILL TAKE PLACE ON NOVEMBER 21 AND 22 WHEN HE TOURS THE FACILITIES OF GENERAL MOTORS AND CARGILL IN ROSARIO, ARGENTINA'S SECOND MOST IMPORTANT CITY. ¶5. (SBU) PRESS COVERAGE OF THE LUNCHEON WAS QUITE HEAVY AND BEGAN DAYS BEFORE THE LUNCHEON EVEN TOOK PLACE. SOME PRESS REPORTS EXAGGERATED THE CONCERNS EXPRESSED BY THE FIRMS DURING THE LUNCH, BUT MOST OF THE REPORTS WERE RELATIVELY ACCURATE AND POSITIVE REFLECTING THE PRESS STATEMENT ISSUED BY THE EMBASSY AFTER THE LUNCH. ¶6. (SBU) COMMENT: THE AMBASSADOR'S FIRST MEETING WITH THE U.S. BUSINESS COMMUNITY IN ARGENTINA WAS CHARACTERIZED BY AN OPEN DISCUSSION OF THE CURRENT BUSINESS REALITY. ALMOST EVERY MEMBER OF THE AMCHAM BOARD OF DIRECTORS WAS PRESENT. THE COMPANIES SAID THEY APPRECIATE USG SUPPORT FOR IMPROVEMENTS IN THE BUSINESS CLIMATE, BUT COUNSELED AGAINST ANY AGGRESSIVE OR PUBLIC COMMENTS ABOUT GOA POLICIES. END COMMENT. WAYNE