CAFTA RATIFICATION BILL FINALLY CLEARS COMMITTEE

1. (SBU) SUMMARY. The bill to ratify CAFTA-DR was approved by the
legislative assembly's Committee on International Relations by a 6-3
vote on December 12, ending over a year of hearings and debate.
Although the results were anticipated, the atmosphere during the
vote was tense, with a small group of rowdy protesters maintaining a
vigil outside the building. Once majority and minority reports are
published and the holiday recess completed, the action shifts to the
full legislature o/a January 15. Rules that facilitate
obstructionism could allow hundreds of motions, potentially leading
to weeks of debate. Anti-CAFTA demonstrations are threatened in the
new year, as well. The Arias administration has shown political
leadership in getting this far, but will need more of the same to
shepherd CAFTA-DR to ratification and move ahead on its full
legislative agenda. END SUMMARY.

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FINALLY OUT OF COMMITTEE
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2. (U) Thirteen months and 21 days after former president Pacheco
sent CAFTA-DR to the legislative assembly (Asamblea) for
consideration, a bill (dictamen) to ratify the treaty was voted
favorably from committee at 11:31 p.m. on December 12. The 6-3 vote
took place one minute past the close of debate deadline set by a
two-thirds vote of the Asamblea on October 31 (Reftel). President
Arias's party, Partido Liberacion Nacional (PLN), plus the
Movimiento Libertario (ML) and Partido Union Social Cristiano (PUSC)
voted in favor, while the Partido Accion Ciudadana (PAC) voted
against. Media reports described the mood inside the hearing room
as tense, and during the proceedings a small group of rowdy
protestors maintained a well-televised vigil outside the building.
The vote came after 278 hours of hearings and debate, testimony from
46 different individuals and entities, and the receipt of volumes of
written testimony.



3. (U) Using powers available to the executive branch during
extraordinary sessions of the Asamblea (which run from December
1-April 30 annually), the GOCR worked with legislature leadership to
defer other agenda items and schedule additional committee sessions
in order to concentrate full attention on CAFTA-DR. President Arias
himself was engaged throughout, following the late-night
developments from his home, working the phones with PLN committee
members.

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MANAGING THE MOTIONS
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4. (U) Next, the committee must prepare and publish its majority
and minority reports. Staff expects plenary deliberations will
begin o/a January 15, 2007. The major challenge may be in managing
the motions. The committee has faced more than 400 (so far), the
vast majority submitted in the last days (and hours) of debate by
CAFTA-DR opponents. The committee adopted 17 motions and rejected


47. The remainder (totaling 340 according to media reports), plus
any of the rejected motions, can be reintroduced in the full plenary
discussion, according to legislative rules. Administration sources
and Asamblea staff thus predict that the debate could last several
weeks, with the first of two required plenary votes taking place in
mid-late February.

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TAKIN' IT TO THE STREETS, AND THE COURT
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5. (U) Among the noisy crowd outside the Asamblea the night of the
vote was shrill-sounding PAC party leader Otton Solis, who embraced
national union leader Albino Vargas and predicted an "enormous"
anti-CAFTA protest in San Jose (which is highly unlikely until after
the end-year holidays). In an earlier press conference, surrounded
by PAC legislators, Solis claimed the committee vote marked the
"Cubanization" of Costa Rica, i.e., that the GOCR was unwilling to
confront "new" ideas. Separately, PAC legislator (and
International Affairs Committee member) Alberto Salom publicly
hinted of a constitutional challenge in the Supreme Court, even
prior to the Court's mandatory review of the CAFTA-DR legislation
(which will take place between the two plenary votes next year).



6. (U) Minister of the Presidency Rodrigo Arias quickly dismissed
the PAC's allegations. In a statement issued on December 13, he
noted that no other country had held such an extensive committee
debate (in which PAC legislators spoke 976 times). If that was not
sufficient time for the PAC (and other opponents) to say what they
had to say, he did not know what was. Arias also criticized PAC's
"change of strategy," which, based on Solis's comments, appeared to
be headed out of the Asamblea and "to the streets".

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THE REST OF THE AGENDA(S)
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7. (U) The Arias administration has a full legislative plate beyond
ratification of CAFTA-DR. First, there is an implementation agenda,
which includes the bills the GOCR believes it must enact in order to
make Costa Rican law CAFTA-compliant. This agenda covers highly
controversial subjects such as opening the telecom and insurance
monopolies. Passage of these bills is subject to a slightly
different and potentially longer approval process than CAFTA-DR
ratification. The GOCR must adopt numerous changes to regulations to
be consistent with the agreement.



8. (U) In addition, there is the GOCR's so-called complementary
agenda, which is not required by CAFTA-DR, but is a package of
measures the GOCR believes is necessary to position the country to
take advantage of the benefits of the agreement - such as increased
education spending, fiscal reform, strengthening the telecom
monopoly so that it can compete in an open market and other reforms
it believes are necessary to advance Costa Rican society in
general.

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COMMENT
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9. (SBU) So far, so good. Getting CAFTA-DR out of committee is an
important step, even if late in coming. The GOCR used its 38-seat
working coalition in the asamblea to set a deadline, then exercised
political discipline to stick to it. In a welcome change from the
Pacheco administration, the Arias team has been more willing to
shape and manage its agenda during the extraordinary session. In
contrast, the PAC-led opposition sounds increasingly desperate, and
is increasingly perceived by the public as filibustering, with no
substantive alternative to offer. Solis's "take it to the streets"
announcement, for example, completely reverses his well-publicized
assurances at the time of the anti-CAFTA rallies in October that PAC
was the responsible opposition, who would work in the legislature to
advance its agenda.



10. (SBU) Street demonstrations to date have been small and without
meaningful consequence. There is more to be done, in a fairly short
time. The Arias administration will have to work hard to overcome
the systemic inertia that naturally slows the rule-bound
legislature. Rodrigo Arias has hinted publicly of rule changes that
might be needed to speed debate. This is another good sign. The
GOCR may have to use all the political tools at its disposal to
shepherd CAFTA-DR to ratification and move ahead on the remainder of
its challenging and necessary legislative agenda.
Langdale