EL SALVADOR: POST'S VIEWS ON DISASTER

C O N F I D E N T I A L SECTION 01 OF 02 SAN SALVADOR 000318

SIPDIS

DEPARTMENT FOR PRM/PRP AND WHA/CEN

E.O. 12958: DECL: 02/06/2016
TAGS: ES PGOV PHUM PREF PREL SMIG
SUBJECT: EL SALVADOR: POST'S VIEWS ON DISASTER
RECONSTRUCTION STATUS, COUNTRY CONDITIONS, AND TPS EXTENSION

REF: A. 2005 SAN SALVADOR 3507


B. STATE 15163

Classified By: Ambassador H. Douglas Barclay, Reasons 1.4 (b) and (d)


1. (C) SUMMARY: Temporary Protected Status status should be
extended for El Salvadoran beneficiaries currently residing
and working in the United States. El Salvador's ongoing
recovery from the 2001 earthquakes and the 2005 eruption of
the Santa Ana volcano is incomplete. Current conditions
prevent the safe return of Salvadoran nationals to a country
still ill-prepared to absorb them. END SUMMARY.


2. (SBU) The earthquakes of January and February 2001
claimed 1,159 lives, damaged or destroyed 276,000 homes,
destroyed major hospitals and community infrastructure
(schools, health centers, water and sanitation systems,
public marketplaces and municipal centers, etc.),and left
unserviceable 1,400 miles of roadways. This major disruption
to the economy and social fabric of the country has yet to be
overcome. The resulting damage to the economy persists, and
economic growth and job creation still suffers. Poverty
rates have also increased, especially in rural areas.


3. (SBU) The GOES remains engaged in high-priority
earthquake reconstruction activities with USAID assistance.
Despite USAID's USD 170 million disaster reconstruction
program, reconstruction activities remain incomplete. We
estimate that the programs will not be completed in less than
24 months. This translates into a continued deficit in
low-cost housing, and a lack of access to hospital-based
healthcare services for many communities.


4. (SBU) Reftel A outlined the effects of the October 1,
2005 eruption of Santa Ana Volcano, which was immediately
followed by flooding and mudslides from Hurricane Stan.
According to the United Nations Economic Commission for Latin
America and the Caribbean (UN/ECLAC),October's natural
disasters caused 69 deaths and USD 355.6 million in damage
and losses (2.2 percent of GDP) to housing, infrastructure
(water and sanitation, electrical distribution, schools,
health facilities, roads),and to the economy, particularly
the agricultural sector. The impact of these latest
disasters, in addition to yet-unfinished earthquake
reconstruction work, significantly hampers the GOES's ability
to address El Salvador's key social and economic challenges.
The Government must again redirect public investment (to
which end, they are now negotiating changes to several
international loans),and they are also requesting additional
international donor assistance.


5. (SBU) Partly as a result of low investment, recent growth
in El Salvador's economy has been lackluster, averaging only
approximately two percent during the last five years. The
natural disasters and resulting economic downturns have
contributed to this trend. Although unemployment now stands
at approximately 7 percent, underemployment in 2004 equaled
35 percent, and El Salvador's overall poverty rate remains 35
percent (but ranges as high as 50 percent in some rural
areas). Remittances from Salvadorans living abroad,
including TPS beneficiaries, was estimated at USD 2.8 billion
last year, and equals 16.6 percent percent of GDP. At
present, there are insufficient economic opportunities to
ensure a secure reintegration of returnees, and inadequate
social-services capacity to attend them. Any influx of
Salvadorans to low-growth/highly-impoverished regions would
heighten social tensions and represent an immediate negative
shock to the economy, and could even precipitate a negative
growth trend. Under these circumstances, Post believes that
the security of returnees, a key concern of TPS, could be at
risk resulting from economic and social tensions that
themselves are a result of underemployment.


6. (C) In addition to the clear statutory rationale behind
continuing TPS for Salvadorans, there is also a political
imperative for extending TPS. Several important U.S.-El
Salvador bilateral interests stand at sensitive crossroads.
President Saca on January 24 announced the deployment of a
sixth contingent of troops to Iraq in support of coalition
forces. Salvadoran engagement in Iraq represents one of the
Saca administration's few political vulnerabilities, as poll
after poll show that it is unpopular with a majority of
Salvadorans. Nonetheless, Saca and his party see their
support in Iraq as a way to express gratitude for U.S.
support during El Salvador's own armed struggle. Terminating
TPS would undercut Saca's support of U.S. positions in the
hemisphere and globally. Lastly, in nationwide elections
scheduled for March 12, all 84 Legislative Assembly seats and
all 262 mayoralities will be contested, and the opposition
Farabundo Marti National Liberation Front (FMLN) is casting
about for any issue it hopes might achieve greater resonance
among voters. For these reasons, on top of Salvador,s
inability to take back its citizens safely, post strongly
advocates the extension of Temporary Protected Status for TPS
beneficiaries from this country.
Barclay