PARAGUAY POLITICAL AND ECONOMIC UPDATE APRIL 20 -

C O N F I D E N T I A L ASUNCION 000383

SIPDIS

SIPDIS

STATE FOR WHA/BSC, INL/LP (JIM HIDES)
EB/IFD/OIA
STATE PASS TO USAID FOR LAC/AA
STATE PASS TO USTR FOR LYANG
NSC FOR SUE CRONIN
TREASURY FOR OSIA MAUREEN WAFER
TREASURY FOR OTA WARFIELD, VAN KOCH, MILLAR
COMMERCE FOR ITA SARAH COOK
SOUTHCOM FOR POLAD

E.O. 12958: DECL: 05/04/2027
TAGS: PGOV PHUM PREL AID ECON PA
SUBJECT: PARAGUAY POLITICAL AND ECONOMIC UPDATE APRIL 20 -
MAY 4, 2007

REF: A. 06 ASUNCION 1113


B. 06 ASUNCION 1246

Classified By: MICHAEL J. FITZPATRICK; REASONS 1.4 (b),(d)


1. (U) SUMMARY:

-- President Postpones Spain Trip
-- Government Monopoly Cripples Internet
-- Deputies Pass Penal Code Reform
-- Ycau Bolanos Case Can't Seat Judge Panel
-- Journalists Protest Inaction on Cases

PRESIDENT POSTPONES SPAIN TRIP


2. (C) President Duarte postponed his trip to Spain April 24
claiming it was in "solidarity" with some 300 Paraguayans
that were being deported by Spanish authorities. Leticia
Casati, the MFA's Director of the Europe Desk, told PolOff
May 4 that the President made his decision out of concern
over "the suffering of Paraguayan migrants and what he
(Duarte) viewed as a violation of their human rights by
Spanish authorities." Casati also noted that FM Ramirez
Lezcano will visit Spain in the near future to discuss
immigrantion issue among other matters.

GOVERNMENT MONOPOLY CRIPPLES INTERNET


3. (U) Internet service for the entire country of Paraguay
shutdown May 2 for more than 2 hours (and in some
jurisdictions as much as 5 hours) when a fiber-optic cable
was accidentally cut by contractors for the Public Works
Ministry. COPACO, the government-owned communications
company, controls all Internet service and sells access to
private firms, who in turn, sell to consumers.
(NOTE:Paraguay is one of 20 countries selected for funding
under USAID's Global Last Mile Initiative in October 2006 - a
program that aims to facilitate internet access to more
marginalized communities in Paraguay's interior. Only 3
persons out of 100 have access to the internet in the country
-- the lowest access rate in the region. END NOTE.)

DEPUTIES PASS PENAL CODE REFORM


4. (U) The House of Deputies passed the Penal Code Reform
Bill with minor changes May 3. The bill includes provisions
to stiffen penalties for money laundering and IPR violations
and introduces first time provisions and penalties for
terrorist financing. The Senate is set to review the
legislation May 14 with some chance it could come up for a
vote in the Senate by the end of the month. Both sponsors of
the bill are Senators - one from the governing Colorado Party
and the other from the opposition - giving it a decent
prospect for adoption. (NOTE: The Procedural Code Reform
Bill - which will strengthen the hands of the prosecutors in
investigating money laundering and terrorist financing - may
be submitted as well in short order to the Congress. This
bill could well attract greater controversy from a number of
different sides, including civil libertarians concerned about
empowering the state. END NOTE.)

YCUA BOLANOS CASE CAN'T SEAT JUDGE PANEL


5. (C) Judges Segundo Ibarra, Hugo Came and Norma Salomon
were selected to preside over the new Ycua Bolanos fire case.
Each of them, however, have recused themselves from the case
for various reasons. Edgar Sanchez, the prosecutor assigned
to the case, told PolOff April 2 that, not only was he the
only prosecutor to agree to take the case, but the courts
have had trouble identifying presiding judges. Sanchez
maintained that no judge wants to touch the case and that he
does not expect the case to be heard before the elections set
for April 2008. (NOTE: More than 55 judges have recused
themselves. END NOTE).

JOURNALISTS PROTEST INACTION ON CASES




6. (U) The Paraguayan Journalists Union (SPP) protested in
front of the Supreme Court April 26 to celebrate its
anniversary (as well as Press Freedom Day) and to draw
attention to the inaction of the courts on the disappearances
and/or deaths of several journalists. Supreme Court
President Alicia Pucheta and Justice Victor Nunez briefly
attended the event to present files on the cases of several
journalists including Santiago Leguizamon, Calixto Mendoza,
Salvador Medina, and Samuel Roman which the Justices
maintained reflected a complete investigation had taken
place. SPP officials, however, asserted that the courts have
hindered investigation into the cases of the above-noted
journalists as well as many others that have disappeared or
have been killed.





FITZPATRICK