VENEZUELA: TITLE III OF LIBERTAD ACT

C O N F I D E N T I A L CARACAS 002268 SIPDIS SIPDIS PLEASE PASS TO WHA/CCA E.O. 12958: DECL: 11/26/2017 TAGS: ETRD ETTC CU VE SUBJECT: VENEZUELA: TITLE III OF LIBERTAD ACT REF: A. STATE 158768 ¶B. 2006 CARACAS 1096 ¶C. CARACAS 694 ¶D. CARACAS 597 ¶E. CARACAS 844 ¶F. 2006 CARACAS 3548 Classified By: ECONOMIC COUNSELOR ANDREW N BOWEN FOR REASON 1.4D ¶1. (C) In response to REF A tasking, Post sees no evidence that the BRV has undertaken policies or actions to advance democracy, human rights, or fundamental freedoms in Cuba over the past year. On the contrary, President Hugo Chavez is Fidel Castro's closest ally and has repeatedly and publicly praised the Cuban government. Chavez has criticized countries for commenting on the human rights situation in Cuba. Post's response to Ref A. questions follow: ¶2. (C) What is the nature of investments (and names, if known) that host country businesses have in Cuba? As reported in Reftel B, state oil company PDVSA and state-owned Venezuela Industrial Bank have offices in Havana. In addition PDVSA has entered into a joint venture with the Cuban Petroleum Company (CUPET) to refurbish and start operations at the Cienfuegos oil refinery. According to Cuban and Venezuelan press reports the refinery will open in December 2007 and will produce 65,000 barrels per day of petroleum. PDVSA and CUPET also agreed to conduct joint studies in the Gulf of Mexico and other areas in Cuban territory. On January 27, 2007 Cuba and Venezuela signed a Memorandum of Understanding (MOU) for the construction of a joint steel factory, three oil and petroleum distillates storage facilities, a nickel factory, and a study to evaluate the opening of a power station in Cuba. We also understand that Venezuela private sector companies operate in Cuba, but we do not have a full listing of the companies or details of their operations. We are also unaware of BRV entities or individuals trafficking in confiscated property in Cuba. ¶3. (C) Are there any bilateral trade agreements between host country and Cuba? Yes, since January 2007, Venezuela and Cuba have signed over 42 bilateral commercial agreements and Post calculates that these often vague promises of joint cooperation and projects are valued at an estimated USD 5.72 billion (Reftel C). Fourteen of these agreements were signed Oct 15, 2007 and include petroleum exploration by PDVSA in Cuban waters, construction of a fiber optic telecommunications cable between Venezuela and Cuba, and the construction of a hotel on a Cuban key. On February 28, during the seventh meeting of the Cuba-Venezuela Intergovernmental Commission in Havana, participants announced the approval of 355 cooperation projects worth USD 1.5 billion, including an agreement to build 11 ethanol plants from sugar cane (Reftel D). Chavez appeared to rescind the ethanol deal on March 20, in order to undercut the bilateral U.S. - Brazil ethanol agreement, but we have seen no official confirmation of this. On April 29, Venezuela, Bolivia, Cuba and Nicaragua signed numerous agreements in areas such as oil, education, health, finance, and culture to advance the Bolivarian Alternative for the Americas and the People,s Commercial Treaty (ALBA-TCP). ALBA is a trade agreement/Latin America integration project that was created December 14, 2004 as a Venezuelan and Cuban proposal to counter the U.S. sponsored Free Trade Agreement for the Americas (FTAA). (Reftel E). Presidents Chavez and Castro signed the Integrated Cooperation Agreement (ICA) between Cuba and Venezuela on October 30, 2000. Under the 2004 amended terms of the ICA, Venezuela supplies 92,000 barrel of oil per day to Cuba in exchange for the following services in Venezuela: dentistry, optometry, diagnostic centers, rehabilitation units, medical equipment and medicine. Cuba also offers services in the following social missions: Mission Milagro (eye surgery for the poor),Deportes Barrio Adentro (sports),Mission de Amor, and Venezuela Adentro. Contacts allege that BRV imports from Cuba sometimes bypass customs and tax officials and enter Venezuela via military ports. These items are reportedly not considered in official trade statistics compiled by the BRV tax authority. ¶4. (C) Are there any exchange programs between host country and Cuba, including but not limited to: scholarships for host country nationals to study in Cuba; Cuban-paid medical travel for host country nationals; and Cuban doctors working in the host country? Venezuela and Cuba have wide-ranging exchange programs as noted in the previous paragraph. According to Venezuela's Ministry of Communication, there were approximately 21,000 Cuban medical personnel working in Venezuela as of mid-2005. Details on the Cuban medical personnel's activities in Venezuela can be found in Reftel F. According to Cuban government-controlled online newspaper, Gamma International, 2,400 Venezuelan doctors are enrolled in Cuban education institutions. In January 2007, Chavez also announced plans to send 100,000 poor Venezuelans on all-expense paid vacations to Cuba. Venezuelans would travel on Cuba's state-run airline Cubana de Aviacion. ¶5. (C) Has the host country, in Post's opinion, worked to promote the advancement of democracy and human rights in Cuba? No. Venezuela makes it a point to vote with Cuba and against the United States in multilateral fora. In addition, Venezuela staunchly defends Cuba publicly, including clearly undemocratic practices that abuse the fundamental freedoms of Cuban citizens. ¶6. (C) Have there been any high level diplomatic visits between Cuba and host country in the past six months? High-level visits between Venezuela and Cuba are frequent and ongoing. Most recently, President Chavez briefly stopped in Havana, on November 21, on his return from visits to Saudi Arabia, Iran, France and Portugal, and spoke with President Fidel Castro and First Vice President Raul Castro. Chavez visited Cuba October 13-16, holding a four hour phone conversation with Fidel Castro, broadcasting his "Alo Presidente" TV and radio program from Santa Clara, attending a pre-inauguration ceremony at the Cienfuegos oil refinery and attending a signing ceremony with Raul Castro for new economic accords under ALBA. Chavez is scheduled to return to Cuba in December for the Cienfuegos oil refinery inauguration. DUDDY