Identifier
Created
Classification
Origin
07TEGUCIGALPA493
2007-03-21 14:34:00
CONFIDENTIAL//NOFORN
Embassy Tegucigalpa
Cable title:
HONDURAN FUEL IMPORTS: USG EFFORTS STAVE OFF
how-toVZCZCXRO1437 OO RUEHLMC DE RUEHTG #0493 0801434 ZNY CCCCC ZZH O 211434Z MAR 07 FM AMEMBASSY TEGUCIGALPA TO RUEHC/SECSTATE WASHDC IMMEDIATE 5289 INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE PRIORITY RUEHCV/AMEMBASSY CARACAS PRIORITY 0558 RHEBAAA/DEPT OF ENERGY WASHDC PRIORITY RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY RUEAIIA/CIA WASHDC PRIORITY RHEHNSC/NSC WASHDC PRIORITY RUEATRS/DEPT OF TREASURY WASHDC PRIORITY RUEHLMC/MILLENNIUM CHALLENGE CORP WASHINGTON DC PRIORITY 0607
C O N F I D E N T I A L TEGUCIGALPA 000493
SIPDIS
SIPDIS
NOFORN
STATE FOR EB/ESC, WHA/EPSC, WHA/PPC, EB/CBA, AND WHA/CEN
STATE FOR D, E, P, AND WHA
STATE FOR S/ES-O MMILLER AND MSANDELANDS
TREASURY FOR AFAIBISHENKO
STATE PASS AID FOR LAC/CAM
NSC FOR DAN FISK
COMMERCE FOR MSELIGMAN AND WBASTIAN
STATE PASS USTR FOR AMALITO
E.O. 12958: DECL: 03/21/2017
TAGS: EPET ENRG PREL BBSR NI VE HO
SUBJECT: HONDURAN FUEL IMPORTS: USG EFFORTS STAVE OFF
NATIONALIZATION, FOR NOW
REF: A) TEGU 463 AND PREVIOUS
Classified By: DCM James Williard for reasons 1.4 (b,d)
C O N F I D E N T I A L TEGUCIGALPA 000493
SIPDIS
SIPDIS
NOFORN
STATE FOR EB/ESC, WHA/EPSC, WHA/PPC, EB/CBA, AND WHA/CEN
STATE FOR D, E, P, AND WHA
STATE FOR S/ES-O MMILLER AND MSANDELANDS
TREASURY FOR AFAIBISHENKO
STATE PASS AID FOR LAC/CAM
NSC FOR DAN FISK
COMMERCE FOR MSELIGMAN AND WBASTIAN
STATE PASS USTR FOR AMALITO
E.O. 12958: DECL: 03/21/2017
TAGS: EPET ENRG PREL BBSR NI VE HO
SUBJECT: HONDURAN FUEL IMPORTS: USG EFFORTS STAVE OFF
NATIONALIZATION, FOR NOW
REF: A) TEGU 463 AND PREVIOUS
Classified By: DCM James Williard for reasons 1.4 (b,d)
1. (C/NF) In a hemisphere disillusioned with market
economics, the USG has successfully held the line in
Honduras. Thanks to two face-to-face meetings between POTUS
and Honduran President Jose Manuel "Mel" Zelaya Rosales and
numerous public and private interventions by the Ambassador
and his staff, the USG repeatedly disrupted Honduras'
populist/socialist plan to nationalize all fuel imports.
Over the last year, USG action stopped a PetroCaribe deal
with Venezuela, forced the GOH to pause and reconsider its
plan to nationalize the fuels import sector, and led
President Zelaya to shift his rhetoric to support for open
and competitive markets. The GOH's subsequent retreat from
Zelaya's bold pro-market pronouncements of January 2007 show
that the leftist/populist forces remain strong while Zelaya's
own steadfastness falters. Nevertheless, impeding the
adoption of this anti-market policy marks an important
victory for the USG in the region.
2. (C/NF) Key to setting the stage for this victory were two
meetings between POTUS and Zelaya on June 5 and September 18,
2006. On each of those occasions POTUS expressed his
concerns to Zelaya about the risks of Honduran over-reliance
on Venezuelan oil and the Honduran nationalization proposal,
and advised that if it were his choice, he would not try such
a scheme.
3. (C/NF) For over a year, Ambassador and EmbOffs publicly
and privately stressed USG concerns and encouraged Honduran
leaders to examine the nationalization plan much more
carefully. Our focused and well-coordinated outreach effort
inflicted an important defeat on Venezuela's President Hugo
Chavez and those who would support an expansion of the
Bolivarian Revolution into Central America. An October 5,
2006 opinion poll entitled "No to Chavez; Yes to Bush"
reported that 60 percent of Hondurans did not believe
PetroCaribe would save them money at the gas pump, and that
53 percent felt Honduras should not pursue closer ties to
Chavez if such a move would risk relations with the U.S
4. (C/NF) With strong behind-the-scenes encouragement from
Post, in February 2007 the IOCs and the GOH negotiated
proposals for reforms to the GOH pricing formula that would
lower prices for consumers and put Honduras on the fast-track
towards market reforms in 2008. Zelaya then issued a
communique endorsing free markets, all but ending the
nationalization plan. However, on March 2, leading ministers
held another public meeting and released a new communique,
ceding ground on the GOH's market liberalization position and
leaving the door open for the nationalization scheme. We
have not achieved market liberalization yet, but impeding the
adoption of this anti-market policy was itself an important
first step. Moreover, an ill-advised effort to reduce gas
pump prices through a PetroCaribe finance program appears to
be dead.
Ford
FORD
SIPDIS
SIPDIS
NOFORN
STATE FOR EB/ESC, WHA/EPSC, WHA/PPC, EB/CBA, AND WHA/CEN
STATE FOR D, E, P, AND WHA
STATE FOR S/ES-O MMILLER AND MSANDELANDS
TREASURY FOR AFAIBISHENKO
STATE PASS AID FOR LAC/CAM
NSC FOR DAN FISK
COMMERCE FOR MSELIGMAN AND WBASTIAN
STATE PASS USTR FOR AMALITO
E.O. 12958: DECL: 03/21/2017
TAGS: EPET ENRG PREL BBSR NI VE HO
SUBJECT: HONDURAN FUEL IMPORTS: USG EFFORTS STAVE OFF
NATIONALIZATION, FOR NOW
REF: A) TEGU 463 AND PREVIOUS
Classified By: DCM James Williard for reasons 1.4 (b,d)
1. (C/NF) In a hemisphere disillusioned with market
economics, the USG has successfully held the line in
Honduras. Thanks to two face-to-face meetings between POTUS
and Honduran President Jose Manuel "Mel" Zelaya Rosales and
numerous public and private interventions by the Ambassador
and his staff, the USG repeatedly disrupted Honduras'
populist/socialist plan to nationalize all fuel imports.
Over the last year, USG action stopped a PetroCaribe deal
with Venezuela, forced the GOH to pause and reconsider its
plan to nationalize the fuels import sector, and led
President Zelaya to shift his rhetoric to support for open
and competitive markets. The GOH's subsequent retreat from
Zelaya's bold pro-market pronouncements of January 2007 show
that the leftist/populist forces remain strong while Zelaya's
own steadfastness falters. Nevertheless, impeding the
adoption of this anti-market policy marks an important
victory for the USG in the region.
2. (C/NF) Key to setting the stage for this victory were two
meetings between POTUS and Zelaya on June 5 and September 18,
2006. On each of those occasions POTUS expressed his
concerns to Zelaya about the risks of Honduran over-reliance
on Venezuelan oil and the Honduran nationalization proposal,
and advised that if it were his choice, he would not try such
a scheme.
3. (C/NF) For over a year, Ambassador and EmbOffs publicly
and privately stressed USG concerns and encouraged Honduran
leaders to examine the nationalization plan much more
carefully. Our focused and well-coordinated outreach effort
inflicted an important defeat on Venezuela's President Hugo
Chavez and those who would support an expansion of the
Bolivarian Revolution into Central America. An October 5,
2006 opinion poll entitled "No to Chavez; Yes to Bush"
reported that 60 percent of Hondurans did not believe
PetroCaribe would save them money at the gas pump, and that
53 percent felt Honduras should not pursue closer ties to
Chavez if such a move would risk relations with the U.S
4. (C/NF) With strong behind-the-scenes encouragement from
Post, in February 2007 the IOCs and the GOH negotiated
proposals for reforms to the GOH pricing formula that would
lower prices for consumers and put Honduras on the fast-track
towards market reforms in 2008. Zelaya then issued a
communique endorsing free markets, all but ending the
nationalization plan. However, on March 2, leading ministers
held another public meeting and released a new communique,
ceding ground on the GOH's market liberalization position and
leaving the door open for the nationalization scheme. We
have not achieved market liberalization yet, but impeding the
adoption of this anti-market policy was itself an important
first step. Moreover, an ill-advised effort to reduce gas
pump prices through a PetroCaribe finance program appears to
be dead.
Ford
FORD