BREAKFAST WITH VARGAS MALDONADO

C O N F I D E N T I A L SANTO DOMINGO 002568 SIPDIS SIPDIS STATE FOR WHA/CAR E.O. 12958: DECL: 11/15/2017 TAGS: PGOV ECON DR SUBJECT: BREAKFAST WITH VARGAS MALDONADO REF: SANTO DOMINGO 2366 Classified By: Charge d'Affaires Roland W. Bullen, Reasons 1.4(b),(d) ¶1. (U) On November 6, Dominican Revolutionary Party (PRD) presidential candidate Miguel Vargas Maldonado hosted ECOPOLCOUNS and POLOFF for breakfast. Vargas was accompanied by PRD Secretary-General Orlando Jorge Mera, International Affairs Vice President Peggy Cabral de Pena, and International Affairs Director Carlos Guzman. ¶2. (SBU) Vargas recounted his recent visit to New York, where he had carried out campaign events and fund-raising activities. He message there, as well as at home, is of plans to reinvigorate the Dominican economy. Eschewing specifics, Vargas spoke of the need to increase foreign investment, revamp the agriculture sector, and support industrial development. One concrete plan discussed was promotion of the "tourism real estate" sector (i.e. sales of holiday homes),an idea that the PRD candidate said he had picked up from Martin Torrijos, the President of Panama, where that sector is experiencing a boom. ¶3. (SBU) Hitting familiar campaign themes (Reftel),Vargas criticized the administration of his opponent, President Fernandez, for having raised taxes on three occasions while delivering few services to the people. The PRD candidate estimated the cost of constructing the controversial Santo Domingo subway at US$1.2 billion, and predicted that the system will require a permanent subsidy while only addressing seven percent of the city's public transportation needs. This great use of resources, he charged, comes at the expense of funding for health and education. ¶4. (SBU) When it came time to allege corruption in the Fernandez administration, Jorge Mera did the talking. Jorge alleged that the President violated the constitution in seeking a US$130 million loan for public works, a financial transaction which was handled by The Sun Land Corporation. He alleged that the loan did not have the required approval of Congress and that it is unclear where the borrowed funds were allocated. ¶5. (SBU) Jorge also alleged that President Fernandez is abusing government resources for political ends. As examples, the party leader cited events where the President inaugurates public works projects and speeches are made that give the impression of a political rally, as well as advertisements paid for by government ministries in which the Fernandez administration's accomplishments are touted. Vargas added that relief supplies distributed after recent flooding carried the slogan "Let's Move Forward!" (E' Pa'lante que Vamos) which is very similar to Fernandez's campaign slogan, "Move Forward President!" (Pa'lante Presidente). Vargas was also critical of the numerous new sub-cabinet positions added to the government, describing them as blatant patronage. The creation of a Presidential Gastronomic Advisor, he said, was a "joke on the Dominican people." ¶6. (SBU) Turning to the President's constitutional reform initiative, Jorge said that the PRD believes that, with the election only six months away, the atmosphere is too politicized for the reforms to be debated properly. For this reason, the PRD will oppose the amendments that they believe Fernandez will submit to Congress shortly. (Note: In an aside, Jorge claimed that Fernandez will propose the elimination of presidential term limits.) ¶7. (C) COMMENT: Coming from a successful businessman, Vargas' campaign theme of reinvigorating the Dominican economy through improved management sells well. Despite his wealth, the PRD candidate does not have an elitist air; instead, his frequent use of colloquialisms comes off as folksy. He was confident and relaxed in our meeting, and his campaign team is professional and well prepared. We left the breakfast convinced that, while Fernandez maintains a three-to-seven percent lead in the polls, this election will be no cakewalk. (U) This report and additional information can be found on Embassy Santo Domingo's SIPRNET site, http://www.state.sgov.gov/p/wha/santodomingo/ GOUGHNOUR