DAS MCMULLEN'S MEETINGS WITH ECUADORIAN CABINET

C O N F I D E N T I A L QUITO 002528

SIPDIS

SIPDIS

E.O. 12958: DECL: 11/12/2017
TAGS: PGOV EC
SUBJECT: DAS MCMULLEN'S MEETINGS WITH ECUADORIAN CABINET
OFFICIALS


Classified By: Ambassador Linda Jewell for reasons 1.4 (b) and (d)


1. (C) Summary: In two wide-ranging, cordial
discussions, Coordinating Minister Fernando Bustamante and
Acting Foreign Minister Rafael Paredes told DAS McMullen
that the GOE continues to desire a positive, robust
relationship with the United States. Although there are
areas of disagreement, Bustamante and Paredes stressed that
the relationship is bigger than any one issue and hoped
that differences of opinion will continue to be worked out
in a spirit of cooperation. Both men also drew what they
consider clear distinctions between Ecuador and other
regional players, particularly Venezuela and Bolivia. End
Summary.

ACTING FOREIGN MINISTER SURVEYS THE STATE OF ECUADORIAN
AFFAIRS
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2. (SBU) DAS Christopher McMullen, accompanied by
Ambassador Jewell and embassy notetaker called on Acting
Foreign Minister Rafael Paredes November 13. Paredes
reported that Foreign Minister Maria Fernanda Espinosa is
still recuperating from an appendectomy and hopes to resume
her duties shortly, though she will not be able to travel
with the President on his upcoming visit to Asia.


3. (C) Noting that relations between the Ministry and the
Embassy were excellent, Paredes spelled out his view of
Ecuador's current political and diplomatic policies. The
government's policies, both foreign and domestic, are
driven by an intense desire to bring more equality to
society. He noted that the gap between rich in poor in
Ecuador and throughout Latin AMERICA was far too great and
commented that this was a major topic of discussion at the
IberAmerican Conference he attended in Santiago, Chile over
the weekend. Highlighting the fact that Ecuador is still
without a competition law and that the traditional
political parties had not successfully included all sectors
of society in the democratic, political process, Parades
expressed the hope that the upcoming Constituent Assembly
would create the space for such inclusion. As of now,
Paredes lamented, " we have all of this on paper, but not
in practice." For the first time in Ecuador's history, the
country is facing a "mass stampede of migration" to other
parts of the world in search of a better life. For this
reason, in Paredes' view, President Correa is trying to
implement a more inclusive system of government worthy of
those who have left the country so that they can return.
DAS McMullen agreed that the Constituent Assembly presented
an opportunity for positive reform, as well a chance to
include the marginalized sectors of society into the
political process and expressed hope that the outcome would
be successful.


4. (C) In response to DAS McMullen's questions regarding
Ecuadorian foreign policy, Parades stressed that in this
arena as well, the GOE's primary motivation was to help
secure a more just society, not just in Latin America, but
throughout the world. Lamenting the fact that the press is
"fixated" on Hugo Chavez, Paredes noted that while Ecuador
enjoys good relations with both Venezuela and Bolivia,
these countries are "totally different" from Ecuador and
face different problems. DAS McMullen agreed that there is
a tendency both in the American media and in other sectors
to group the Andean countries together in inappropriate
ways without drawing any distinctions between these
nations. Paredes expressed the commonly-held Ecuadorian
view that Colombia is too passive in its dealings with
border issues, and that the GOC's goal is to push the
conflict in Colombia towards the Ecuadorian border.

US-GOE RELATIONS POSITIVE
--------------


5. (C) Paredes went out of his way on several occasions
to stress that relations between the US and GOE were
excellent and that he hoped for continued, more robust
dialogue. He cited the productive meetings Deputy
Secretary Negroponte had with President Correa in May as

SIPDIS
illustrative of the quality of the relationship. While
making a veiled reference to the on-going Occidental
arbitration, Paredes commented that though there were no
doubt areas of disagreement between the two countries, "the
case of only one company is not illustrative of our
relationship." McMullen and Paredes agreed that
discussions regarding Free Trade Agreements were difficult,

for domestic and international reasons. DAS McMullen took
the opportunity to affirm the USG desire to seek other
avenues for economic and trade dialogue - an idea which
Parades said remains appealing to Ecuador.


6. (C) Referring to the Forward Operating Location in
Manta, Paredes said that the GOE's concerns about renewing
its lease, should not be interpreted as a lack of desire on
the government's part to fight narcotics. On the contrary,
the government remains committed to counter-narcotics
activities and the government's interagency coordination in
this field has vastly improved. Paredes used an embassy
talking point, admitting that the FOL "is not a base", but
that as is so often the case, "perception is reality" and
that President Correa must take domestic political
concerns regarding the FOL into consideration. DAS
McMullen stated that the USG understands the sensitivities
of the issue, but that the USG needs to plan for
contingencies if this agreement is not renewed.


COORDINATING MINISTER FERNANDO BUSTAMANTE: ACCENTUATE THE
POSITIVE
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7. (C) Later on November 13, DAS McMullen and Ambassador
Jewell met with Coordinating Minister for Internal and
External Security Fernando Bustamante, his Vice Minister
Juan Sebastian Roldan and his Senior Advisor David Baca.
Both DAS McMullen and Bustamante emphasized common ground
and areas for cooperation. Bustamante said there are many
of opportunities for dialogue between the two sides, but he
stressed the need to avoid stereotypes and the
oversimplification one sees in the press, especially with
regard to Hugo Chavez. He noted that the GOE has "wide
range of friends" that also includes President Lula of
Brazil and President Bachelet of Chile. Bustamante said
that the GOE wants to re-establish the relationship with
the US from a position of "greater self-respect." He said
that Ecuador is not stuck in an anti-imperialist mindset,
however, and that its view of the US is much more nuanced
than that of 15 years ago.

RE-ORGANIZATION OF THE COUNTRY
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8. (C) Mirroring Paredes' earlier comments, Bustamante
said that "the big challenge" for Ecuador is to improve
social equality. He described the GOE as searching for a
US-style "New Deal" for Ecuador. Senior Advisor Baca noted
that the challenges faced by all the countries in the
region date back to the founding of these states. He said
that the current political climate in the Ecuador is
therefore not a "turn left" but rather a "reorganization of
the country" that seeks to "include the excluded" and allow
all members of society to enjoy the full benefits of
citizenship.


9. (C) DAS McMullen emphasized that the US also believes
very strongly in social inclusion. He expressed concern
about the decline in political parties throughout the
region, noting that it was very difficult to govern
effectively without them. Bustamante agreed with this
assessment and said much of the problem stemmed from
collapse in public respect for political parties, which he
said was leading to a rise in anti-democratic sentiment in
the country. He described this situation as "very
dangerous" and said that the GOE was "surfing this
democratic wave, hoping it doesn't destroy us."

CONSTITUTIONAL ASSEMBLY: A VISION FOR THE FUTURE
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10. (C) Bustamante said there is not a clear model in
mind for Ecuador's new constitution, that the goal would be
a liberal democracy that can sustain itself. He lamented
the volatility in Ecuador's political history and said that
he hoped they would be able to achieve the stability
enjoyed by neighboring states such as Brazil. "We've been
bordering on anarchy at times," he acknowledged, "and we
need to stop tinkering." Baca expressed admiration for the
broadly inclusive nature of the US constitution and said
that the GOE hopes to make its new constitution "as
democratic as possible." Bustamante said there were many
elements of the US. electoral system that they might seek
to emulate, but he emphasized that every constitution needs
to reflect the history and society of its own country. He

described some of the key goals as establishing
"territorial order," perhaps with directly-elected
governors for provinces; an improved electoral system; and
a "radical protection of rights."


11. (C) Both Bustamante and Baca expressed frustration
over the decline of government institutions, which has
allowed other organizations to fill the power vacuum.
Bustamante felt that this in turn had led to an
"over-privatization" of the country and a "blurring between
the public and private sectors." He said this has allowed
the state to be "captured by clientism" and was a major
cause of institutionalized corruption. He said that
powerful public sector unions were a big problem in the
country, describing the state-owned company Petroecuador as
"practically an independent republic." He also emphasized
the need for fiscal reform, pointing out that currently 80%
of Ecuador's budget is earmarked. He noted that President
Correa felt the only way to achieve a more responsible use
of public funds is to create a system with accountability
to the electorate and an ability to punish those who misuse
public funds.


12. (C) Bustamante commented that the constitutional
assembly was expected to produce a new constitution within
six months, and he expressed hope that a new congress could
be elected as early as November 2008. Ambassador Jewell
remarked on the ambitious nature of this agenda and noted
how challenging it would be. Bustamante said he hoped that
the Constituent Assembly would not attempt to solve all of
Ecuador's problems itself, but would instead let the new
congress address them. Baca noted that the lack of
opportunity for so much of Ecuador's population has created
a strong demand for change. DAS McMullen and Ambassador
Jewell both pointed to the success of Ireland in
reinvigorating its economy, largely by putting in place the
right policy structures.


SHARED CONCERN OVER THE SITUATION IN BOLIVIA
--------------


13. (C) DAS McMullen noted that US is very concerned
about the situation in Bolivia. He described relations
between the USG and GOB as "two sides with different
views," but stressed that there is a need to find a
solution to allow them to work together. Bustamante said
that the GOE was also concerned about Bolivia and said that
the GOB's inability to manage its affairs effectively is
creating "chaos in the heart of the continent." Bustamante
emphasized differences between Ecuador and Bolivia,
particularly with regard to the indigenous movements. He
described the indigenous populations in Ecuador as akin to
"interest groups," whereas in Bolivia, due to its more
homogenous society, the indigenous movement has become "a
national project."

COOPERATION IN ECUADOR'S NORTHERN REGION
--------------


14. (C) Bustamante said that the challenging situation
faced in Ecuador's northern region stems from weak
government organization and a lack of presence by the
state. He described the work of the GOE in the region as
"state-building," and said that the GOE recognized the need
to create economic alternatives for the population to
ensure that they did not become guerrillas or involved in
the drug trade. Ambassador Jewell emphasized that the USG
sought a cooperative approach in this region, saying "we
want to align our assistance with your needs, otherwise it
doesn't make sense." DAS McMullen agreed, saying that
despite a difficult budgetary situation, the USG was very
interested in providing assistance that can strengthen
institutions.

COMMENT
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15. (C) Bustamante and Paredes's comments accurately
reflect the GOE's reform agenda. While it remains to be
seen whether or not GOE will be able to deliver such
sweeping reform, the desire amongst the upper echelons of
the Correa administration to do so is very evident. Both
minister's verbal commitments to remain close to the United
States are hopefully a signal that relations will remain
positive as Ecuador embarks on the difficult task of
constitutional reforms in the coming months.
E


16. (U) DAS McMullen has cleared this message.



JEWELL