CHAVEZ LOVEFEST; A "PRAGMATIC" EMBRACE

C O N F I D E N T I A L QUITO 001326 SIPDIS SIPDIS E.O. 12958: DECL: 05/24/2016 TAGS: PGOV PREL EC SUBJECT: CHAVEZ LOVEFEST; A "PRAGMATIC" EMBRACE REF: QUITO 1315 Classified By: PolChief Erik Hall for reasons 1.4 (b&d) ¶1. (C) Summary: Venezuelan President Hugo Chavez visited Quito May 30 to sign energy accords (RefTel) and signal political support for the GOE. Chavez was warmly welcomed by President Palacio, who basked in Chavez's praise for defending Ecuador's energy resources. Chavez held an extended one-on-one meeting with Palacio, took explicit public jabs at the U.S., and did all he could to create the impression of deepening bilateral relations between the two Andean nations before departing. GOE officials are keeping mum on the substance of the private meeting, and calling the visit an exercise in Ecuadorian "pragmatism." End Summary. ¶2. (C) GOE officials warned us privately on May 25 about the impending Chavez visit, claiming it came at his request, and had purely technical rather than political ends. They took the same line publicly in advance of the visit, and Chavez initially paid lip service to the non-political nature of his visit. But Chavez rapidly departed from script. Welcomed by 200 supporters at the airport, Chavez broke protocol to embrace the public, and later danced with indigenous children outside the presidential palace. He and Palacio both made impromptu speeches at the signing ceremony, with Chavez praising Palacio's "recuperation of control over Ecuador's energy resources" and Palacio thanking Chavez for Venezuela's support, declaring that "Ecuador's oil resources belong to the people," and pledging that Ecuador's "petro-history would change very soon." ¶3. (C) Chavez' press conference, held at the Venezuelan Ambassador's residence, went a full two hours, delaying his departure. At the press conference, Chavez insisted Venezuela would not return to the Community of Andean Nations, criticized Alvaro Uribe's proposed Bolivarian Community of Nations, and praised Evo Morales' efforts to create a Community of Anti-imperialist Nations. He accused the CIA of involvement in the air crash which killed former Ecuadorian President Jaime Roldos in 1981. GOE Spin -------------- ¶4. (C) VFM Diego Ribadeneira told the DCM on May 31 that the GOE considered the Chavez visit to have been a success. The working meeting on energy cooperation, which Ribadeneira attended, was eminently technical. Ribadeneira confessed that he was not privy to details on the one-on-one Palacio-Chavez meeting, which went much longer than scheduled, at two full hours. As far as he knew, Chavez did not raise Venezuela's UNSC candidacy, and the GOE position on that issue (undecided) had not changed. ¶5. (C) Ribadeneira and other officials privately claim the Chavez visit did not signal any GOE "alignment or realignment" on regional issues. Rather, it reflects Ecuadorian "pragmatism" and reluctance to isolate any nations in the region. Just as the GOE wishes to achieve an FTA with the U.S., he said, it would seek cooperative trade relations with others, including Chavez. The GOE supports South American integration, and cannot afford to ostracize Chavez or any other nation for political reasons. Press and Public Reaction Positive -------------- ¶6. (SBU) Chavez always makes for irresistible copy for the media. He didn,t disappoint this time, receiving front page coverage in all major papers today, as well as the lead piece for TV and radio news. ¶7. (U) The media focused on the signing of the two agreements, the visit to the grave of Ecuadorian independence hero and Bolivar's lieutenant Antonio Jose de Sucre and his warm reception by Bolivarian fans (no more than 200 indigenous and known leftist-populists). Many of the media emphasized the "show" and politicking aspect of the visit. "El Universo" did a sidebar story on divisions in Congress over the visit, with most welcoming it but others raising caution over any political realignment against the United States. "Hoy" ran an ad paid for by the Quito Chamber of Commerce in which the members declared themselves in "mourning" over Chavez' visit. Editorialists and columnists tended to be at least cautiously supportive of the visit, echoing the GOE's pragmatic embrace of the refinery deal as in the national interest. Comment -------------- ¶8. (C) We consider the Chavez visit to be a clear signal from the GOE that it will resist with all means any USG retaliatory measures for the GOE's decision to confiscate Occidental Petroleum's assets. With this outgoing caretaker government set on justifying rather than correcting its errors, the USG response needs to weigh Palacio's "nothing to lose" unpredictability, and maximize possiblities that the government to be elected in October and November can act to clean up Palacio's mess. JEWELL