DUARTE SHUFFLES INDUSTRY AND TRADE MINISTERS

C O N F I D E N T I A L ASUNCION 000829 SIPDIS SIPDIS E.O. 12958: DECL: 10/06/2027 TAGS: ECON PGOV ECPS PREL PA SUBJECT: DUARTE SHUFFLES INDUSTRY AND TRADE MINISTERS Classified By: DCM Michael J. Fitzpatrick; reasons 1.4 (b) and (d). ¶1. (SBU) The president of the Paraguayan Communications Company (COPACO),Juan Ramon Ibarra, resigned October 4 in the wake of charges of incompetent management and influence trafficking for the award of several procurements. Over the past two weeks congressional opposition blocked and then conditioned the approval of several of President Duarte's economic policy measures pending Ibarra's resignation because Ibarra refused to respond to a congressional summons to explain his conduct. ¶2. (SBU) Surprisingly, President Duarte designated Ibarra as the new Ministry of Industry and Commerce October 5. The former minister, Jose Maria Ibanez, resigned his position to pursue his candidacy as governor of Central Province. Ibanez, Ibarra,s godfather, described Ibarra as an "excellent colleague that has worked very hard to improve COPACO." ¶3. (C) COMMENT: The opposition is appalled and the press has heavily criticized the ministerial designation. While it initially appeared that President Duarte "lost" the COPACO battle, his shift of Ibarra to another, arguably higher profile position, gave him the last word. No matter how battered an ally may be, President Duarte has sent the clear message that he will continue to "take care of his boys." Given the short time left in Duarte,s term, we do not expect this shift to have significant policy ramifications; rather, it is a political move in an increasing political pre-election environment. END COMMENT. Please visit us at http://www.state.sgov.gov/p/wha/asuncion CASON