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