MONTEVIDEO CIRCLE MEETS IN COSTA RICA

UNCLAS SECTION 01 OF 02 SAN JOSE 000277 SIPDIS SENSITIVE, SIPDIS DEPT FOR WHA/CEN JASON MACK E.O. 12958: N/A TAGS: PREL PGOV KDEM XM CS SUBJECT: MONTEVIDEO CIRCLE MEETS IN COSTA RICA ¶1. (U) SUMMARY: Costa Rica hosted the Montevideo Circle, a discussion forum for current and former presidents of Latin America, on January 27-28, 2007. The group's topic of discussion was: "Democratic Stability and Opening: Unpredictable Factors for Latin America in the 21st Century," and the participants' remarks largely coincided with USG objectives for the region, including Costa Rican ratification of DR-CAFTA. The meeting was covered extensively in all domestic newspapers. This cable reports excerpts of the press coverage. END SUMMARY. GENERAL THEMES: INVESTMENT/TRADE THE MOTORS OF DEVELOPMENT ¶2. (U) Former presidents Julio Mara Sanguinetti of Uruguay (founder of the Montevideo Circle),Ricardo Lagos of Chile, and Fernando Henrique Cardoso of Brazil promoted free trade and investment attraction as the motor of development for Latin American countries. "Globalization has arrived to stay," said Lagos. Colombian president Alvaro Uribe, host Sscar Arias, and other speakers insisted that Latin America must insert itself into the world market. They agreed that only through global trade will countries achieve real development and lessen domestic income inequalities. ¶3. (U) Former Colombian president Belisario Betancour and former Spanish leader Felipe Gonzlez warned of the possibility of the region becoming "the region of the world with the most inequality." Betancour stated that external debt, lack of social infrastructure and schools, along with hunger and misery work against progress. He also stressed that "education is the key to leaving hunger behind." ARIAS - DEVELOPMENT MUST BE BASED ON EDUCATION ¶4. (U) As host, Arias stuck to familiar themes in his opening address. He asked "What good is it if Latin America has regained democracy if it is incapable of putting food in its peoples' mouths, putting a roof over their childrens' heads? What good is it if a peasant signs a presidential ballot if he knows nothing more than signing his name? Democracy cannot live without food or a roof. Human development must be based on education. One in three children do not go to secondary school (in Costa Rica). Today's educational failure is tomorrow's economic failure." Arias emphasized that hunger, ignorance, and frustration fertilize the ground for a resurgence of authoritarianism and that democracy should complement prosperity and development. Otherwise, he warned, the task of maintaining respect for liberties will be titanic. Using Cuba as an example, Arias warned that Latin America runs a serious risk of returning to dictatorship. SANGUINETTI - INVESTMENT MEANS GROWTH AND JOBS; FREE TRADE AGREEMENTS (FTAs) HELP COUNTRIES MOVE FORWARD ¶5. (U) Sanguinetti told an interviewer, "Only investment brings growth and generates jobs. We are entering a new century, but walking backwards with an archaic debate. Globalization is a real, scientific fact." Sanguinetti insisted that economies must open, given the experience of Latin American countries which have opened their economies. "In general, I think that economies either open or fall behind. To incorporate ourselves into the global world is not ideology, it's a fact. Of course, a market economy assumes more open competition, that's the challenge. One has to get used to the vigorousness of competition." ¶6. (U) When asked how the Montevideo Circle views the new Latin American Left Sanguinetti replied, "This is a discussion group with free opinions. We have the common conviction about democracy and freedom. In Latin America, unfortunately, we are living in a new stage of fragmentation after years of seeking integration. Mercosur and the Andean Community are in crisis. Perhaps the most effective and efficient integration process is in Central America." Sanguinetti stressed, "True democracy is based on dialogue and real consensus, with the objective to find mechanisms that solve the social and economic needs of each country." He concluded, "In Europe the Berlin Wall fell, but not in Latin America. Liberalization has achieved positive but minor effects. FTAs do not substitute for development strategies, but they are necessary for countries to enter new markets." LAGOS - FTAs PROTECT SMALL COUNTRIES; GROWTH AND INVESTMENT CAN HELP THE POOR ¶7. (U) Lagos told the media that "free trade agreements give us market access; they are instruments that countries must know how to use," he continued. "Technological innovation and even unique cultural traits could be small countries' strengths. Training people how to confront the issue of globalization with the right skills seems fundamental to me. There was a clear conviction that we were going to tie Chile's growth to our capacity to link to the world and exports were to play an important role as a measure of our growth. But the most important public policies are those that assure economic growth reaches those most in need." ¶8. (U) Lagos opined that a hemispheric debate has begun over which is the fastest and most efficient way to eliminate the huge gap between rich and poor. "For me, the fastest way is growth and to grow you have to invest. Once [an economy] has the growth, then public policies can be created to help those who have less." Lagos described the region's lean to the left as a search for political solutions to resolve the inequality dilemma. "Now we are a middle SAN JOSE 00000277 002 OF 002 ¶1. (U) SUMMARY: Costa Rica hosted the Montevideo Circle, a discussion forum for current and former presidents of Latin America, on January 27-28, 2007. The group's topic of discussion was: "Democratic Stability and Opening: Unpredictable Factors for Latin America in the 21st Century," and the participants' remarks largely coincided with USG objectives for the region, including Costa Rican ratification of DR-CAFTA. The meeting was covered extensively in all domestic newspapers. This cable reports excerpts of the press coverage. END SUMMARY. GENERAL THEMES: INVESTMENT/TRADE THE MOTORS OF DEVELOPMENT ¶2. (U) Former presidents Julio Mara Sanguinetti of Uruguay (founder of the Montevideo Circle),Ricardo Lagos of Chile, and Fernando Henrique Cardoso of Brazil promoted free trade and investment attraction as the motor of development for Latin American countries. "Globalization has arrived to stay," said Lagos. Colombian president Alvaro Uribe, host Sscar Arias, and other speakers insisted that Latin America must insert itself into the world market. They agreed that only through global trade will countries achieve real development and lessen domestic income inequalities. ¶3. (U) Former Colombian president Belisario Betancour and former Spanish leader Felipe Gonzlez warned of the possibility of the region becoming "the region of the world with the most inequality." Betancour stated that external debt, lack of social infrastructure and schools, along with hunger and misery work against progress. He also stressed that "education is the key to leaving hunger behind." income hemisphere, but the difference between rich and poor is as unjust as when we were a poor hemisphere. This isn't Africa, but close." CARDOSO - MUST OVERCOME INEQUALITY IN EDUCATION ¶9. (U) The former Brazilian leader echoed Arias's comments on education. "There is an immense inequality in education," he said, which must be reduced to "confront change." Cardoso urged Latin American universities, which he described as "isolated" and far from businesses that generate jobs and from the governments that dictate policies, to better integrate themselves into this mainstream. COMMENT: ¶10. (SBU) Our MFA contacts made clear this was an initiative of President Arias's office, and not the Ministry. Hosting this event is certainly in keeping with Arias's penchant to discuss (and to be seen as discussing) issues of global and regional import. One San Jose-based diplomat hinted to the Ambassador that this latest Montevideo Circle event was intended to be not just another gab-fest, but as a first step to developing a thoughtful regional counterweight to Chavez-style populism. Uribe's presence (and Arias's hosting) gave the meeting a higher and more relevant profile, and the participants' public remarks largely coincided with USG objectives for the region, including Costa Rican ratification of DR-CAFTA. However, more than just a well-publicized conference will be needed to develop a regional antidote to Chavez, Ortega and Co. LANGDALE