PERUVIAN AMBASSADOR ON VENEZUELA'S RE-ENTRY INTO

C O N F I D E N T I A L CARACAS 001805 SIPDIS SIPDIS HQSOUTHCOM ALSO FOR POLAD DEPT PASS TO AID/OTI RPORTER E.O. 12958: DECL: 09/11/2017 TAGS: PREL PGOV ETRD VE SUBJECT: PERUVIAN AMBASSADOR ON VENEZUELA'S RE-ENTRY INTO ANDEAN COMMUNITY Classified By: POLITICAL COUNSELOR ROBERT R. DOWNES FOR REASON 1.4 (D) ¶1. (C) Speaking "unofficially" Peruvian Ambassador Luis Santa Maria Calderon told the Ambassador during an initial courtesy call September 10 that Peru would probably welcome Venezuela's reintegration into the Andean Community of Nations (CAN),but prefers that Venezuela be re-admitted as an associate member. Venezuela withdrew from the CAN in April 2006 to protest Peru and Colombia's signing of free trade agreements with the United States. However, President Chavez announced on August 31 that Venezuela may return to the CAN if social issues became a pillar of the organization's activities. Santa Maria said Chavez' overly ambitious aspirations of becoming a regional economic player led the Venezuelan president to opt out of the CAN and pursue entry into Mercosur. He asserted that the Brazilian and Paraguayan congresses' decision to delay Venezuela's entry into Mercosur over political concerns has forced Chavez to reconsider his decision to leave the CAN. ¶2. (C) Santa Maria noted that Venezuela technically remains a full member of the CAN because the withdrawal process takes five years to complete. To save face, however, Santa Maria believes Venezuela may only seek re-admission as an associate member. (Note: Santa Maria did not indicate that Peru would or could challenge Venezuela if it decided to rejoin the CAN as a full member. End Note.) ¶3. (C) Venezuela's re-entry as a full member would shift the balance of power within the bloc, Santa Maria said. Currently, Peru and Colombia are the two largest economies and exert significant influence over the other member states. For this reason, Bolivian President Evo Morales and Ecuadorian President Rafael Correa support Venezuela's reintegration as a full member. According to Santa Maria, Morales commented that Venezuela's re-entry would give the "popular" governments the upper hand (a three to two margin) in the regional trade bloc. DUDDY