CENTAM AMBASSADORS CONCERNED ABOUT NICARAGUA'S

C O N F I D E N T I A L SECTION 01 OF 02 MANAGUA 000140

SIPDIS

SIPDIS

DEPT FOR WHA/CEN

E.O. 12958: DECL: 01/17/2017
TAGS: PGOV PREL KDEM NU
SUBJECT: CENTAM AMBASSADORS CONCERNED ABOUT NICARAGUA'S
ROLE IN REGIONAL AFFAIRS

REF: MANAGUA 0106

Classified By: Ambassador Paul Trivelli for reasons 1.4 (b and d)


1. (C) Summary: Central American ambassadors in Nicaragua
were startled by the populist rhetoric and procession of
infamous guests surrounding the inauguration of President
Daniel Ortega (reftel),but maintain a cautious optimism that
regional and international agreements will constrain the
Ortega administration's scope of action. The ambassadors
agreed on the need to publicize the benefits of CAFTA to
regional economies and have been somewhat mollified by
Ortega's promises to respect the rights of international
investors and preserve relations with Taiwan. They also
believe that, as neighbors, their countries can engage the
Nicaraguan government and help offset the negative influence
of Venezuelan President Hugo Chavez on Ortega. Several
commented on Ortega's margin of victory and "minority
government," wondering how the Liberals will ultimately
relate to themselves and the Sandinistas. End Summary.


2. (C) Ambassador Trivelli hosted a group of Central American
ambassadors for breakfast on January 17 to discuss the
ramifications of Daniel Ortega's return to power on regional
affairs. The ambassadors were dismayed by Ortega's populist
rhetoric during the inauguration, his accession to agreements
with Venezuela, and proposals to alter laws governing the
Government and Defense ministries without public
consultation. "He is behaving as though he has a clear
mandate even though he only won with 38 percent of the vote,"
they commented. The ambassadors were hopeful, however, that
regional and international agreements such as CAFTA and the
Central American Integration System (SICA) can constrain his
actions. They also agreed that Secretary Leavitt's health
initiative, which was shared with most of them during
bilateral meetings held on the margins of the inauguration,
would be critical in helping Central America "catch up" with
other countries in the region. The following chiefs of
mission attended the breakfast:

- Costa Rica: Manuel Barrantes, Charge d'Affaires
- El Salvador: Jose Roberto Francisco Imendia Maza, Ambassador
- Honduras: Jorge Milla Reyes, Ambassador
- Guatemala: Jorge R. Echeverria Roldan, Ambassador
- Panama: Miguel Lecaro Barcenas, Ambassador


3. (C) Several ambassadors made the point that "times have
changed," so that the Sandinistas' behavior will not be as
radical as in the 1980s. "The Sandinistas are older now --
they have less hair and more children, grandchildren, and
investments," commented Barrantes. Milla wondered how long
Ortega would be able to keep up his "double talk," and Lecaro
responded, referring to Panamanian President Torrijos'
relationship with Chavez, that one can be publicly polite and
privately pragmatic (Torrijos realizes that Chavez is
"unstable"). Echeverria mentioned that the other CentAm
presidents can work through SICA to constrain Ortega, and
that Guatemala can exercise a moderating influence as the
country in charge of regional economic affairs.


4. (C) The ambassadors are skeptical of Chavez' Bolivarian
Alternative for the Americas (ALBA),especially as they have
not seen any details of the agreement, and mentioned the need
to publicize CAFTA and its success thus far as a
counterbalance. Ambassador Trivelli noted that CAFTA is an
extensively negotiated treaty that underwent a thorough
public vetting in each country. Imendia mentioned that El
Salvador has already enjoyed a significant GDP boost from
CAFTA, and Milla encouraged the group to educate the Central
American public regarding the benefits of CAFTA. Imendia
suggested that holding a regional conference on CAFTA would
help promote the trade agreement. The Ambassador, who
remarked that President Saca had raised this idea during his
meeting with Secretary Leavitt, suggested holding such a
meeting in Managua to allow the Nicaraguan government to
appreciate CAFTA's importance first-hand.


5. (C) Some of the ambassadors commented on pre- and
post-inauguration meetings with Ortega where the new
President pledged not to disrupt the status quo in a number
of areas. Ortega assured El Salvadoran President Saca that
El Salvadoran investors in Nicaragua would be respected.
Honduran President Zelaya pointed out to Ortega that the
Central American relationship with Taiwan has been of mutual
benefit to the region and urged Ortega not to switch official
recognition to the PRC. (Note: Milla also remarked that
Taiwanese President Chen Shui-bian thanked Zelaya at Ortega's
inauguration for his efforts. End Note.)


6. (C) Regarding Ortega's ability to enact wide-ranging
reforms, several ambassadors noted that the Sandinistas are a
minority in the National Assembly. Milla wondered when and
if the Liberals will finally put aside their differences and
form a real opposition to the Sandinistas. Ambassador
Trivelli responded that the future of the Liberals is
dependent on the Liberal Constitutional Party's (PLC)
relationship with convicted party leader Arnoldo Aleman, who
is essentially Ortega's hostage. He commented on El
Salvadoran ex-President Calderon Sol's pre-election efforts
to separate Aleman from the PLC and suggested Calderon Sol's
efforts might bear more fruit in the post-election
environment. (Note: On January 18, the Ambassador suggested
to Spanish Ambassador Jaime de la Cadena that a return visit
of Calderon to Managua to meet with Nicaraguan Liberal
leaders, including National Assembly lawmakers representing
the Liberal Constitutional Party (PLC) and the Nicaraguan
Liberal Alliance (ALN) might help to encourage them to mend
their differences. The Spaniard was receptive to the idea.
End Note.)


7. (C) Comment: Nicaragua's neighbors are understandably
concerned if Nicaragua's domestic problems spill over the
borders. The Guatemalan ambassador noted that "when
Nicaragua coughs, Guatemala develops a fever," while the
Costa Rican warned that "if Nicaragua coughs, Costa Rica
catches pneumonia." We will continue to consult with the
Central American ambassadors on the most effective ways to
publicize CAFTA's successes and the use of regional
mechanisms to counteract Chavez' influence in the region.
The ambassadors agreed to continue to hold regular meetings
to evaluate the actions of the Ortega administration.
TRIVELLI