ARGENTINA: AGRARIAN FEDERATION ON CURRENT

C O N F I D E N T I A L BUENOS AIRES 001180

SIPDIS

DEPT PLS PASS TO USDA

E.O. 12958: DECL: 08/13/2018
TAGS: PGOV EAGR ECON AR
SUBJECT: ARGENTINA: AGRARIAN FEDERATION ON CURRENT
POLITICAL SITUATION

REF: BUENOS AIRES 1172 AND PREVIOUS

Classified By: CDA Tom Kelly for reasons 1.4 (b) and (d).


1. (SBU) Summary: Nicolas Bossio, Private Secretary to the
President of the Argentine Agrarian Federation (FAA),sees
new-found solidarity in Argentina's agricultural sector,
embodied by the coordinating Liaison Table ("Mesa de
Enlace"),a committee comprised of the four agricultural
entities that led the sector's 120-day-long protest and
strike against variable export taxes. Bossio explained that,
through this Table, a formerly fractious agricultural sector
has changed its political strategy and tactics to more
effectively lobby political leaders with a unified voice that
focuses on sector-wide priorities. Bossio clarified that the
recent Congressional proposal to create a type of national
grain board with power to buy and sell agricultural products
would not be acceptable to the agricultural sector. He
argued that the government's conflict with the agricultural
sector was exacerbated by an increasing concentration of
power in Argentina's political system, noting that provincial
politicians have historically been beholden to the federal
executive rather than their own constituents. End Summary.

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Consensus-Building: A New Paradigm for Argentina's Ag Sector
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2. (SBU) On August 7, 2008, Senior Professional Staff Member
Senior Professional Staff Member of the Senate Foreign
Relations Committee Carl Meacham and WHA/BSC Deputy Director
Bruce Friedman met with Nicolas Bossio, Private Secretary to
the President of the Argentine Agrarian Federation
(Federacion Agraria Argentina) (FAA). Bossio remarked that
one of the outcomes of Argentina's extended 120-day-long
agricultural protest has been a paradigm shift for the
agricultural sector's interaction with the government. The
creation of a coordinating Liaison Table ("Mesa de Enlace")
to act as a unified voice for the various interests of the
sector has enabled a unity among a normally fractious
agricultural community that has never before existed in
Argentina. The Liaison Table has emerged as a mechanism
through which competing ag interests will determine
priorities for the entire sector. Bossio said that those
priorities determined by consensus will supersede the
interests of any one specific interest group within the rural
sector.


3. (SBU) Bossio indicated that the four agricultural groups
-- the FAA, the Argentine Rural Society (SRA),the Argentine
Rural Confederation (CRA),and the Agricultural Cooperative
Confederation (Coninagro) -- who form the Liaison Table are
committed to this new-found solidarity and intend to lobby
the GOA as a single voice. Their internal polling of farmers
shows that 90% of their members have a positive view of the
Liaison Table and that it is perceived as an honest broker of
sector interests. Those farmers also indicate that they want
the Liaison Table to complement the four existing groups and
become a permanent fixture that will promote and represent a
unified sector stance. He also commented that last week the
Liaison Table began the process of creating 20 sub-committees
to discuss sector-specific interests, including beef and
dairy, as well as legislative affairs.


4. (SBU) Before banding together in protest over the GOA's
variable ag export tax scheme (Resolution 125),the
agricultural sector's interaction with government officials
was limited and largely uncoordinated. Bossio remarked that,
prior to and during the conflict, the sector had limited
interaction with then GoA Agriculture Secretary Javier De
Urquiza because they knew he had little political power to
effect change. As a result, the ag sector's petitions to
both Kirchner administrations fell on deaf ears, as
exemplified by the fact that President Cristina Fernandez de
Kirchner (CFK) sent Resolution 125 to the Congress only after
there had been 100 days of conflict. Bossio stated that he
believes that this paradigm -- i.e., disparate agriculture
interests petitioning an unresponsive government -- has now
changed. Earlier this week, the Liaison Table met with newly
appointed Secretary of Agriculture Carlos Cheppi. Although
the government has indicated that it wants to open dialogue
with the rural sector and to include agriculture in its
Bicentennial "Social Pact" dialogue with labor and the
various productive sectors of the economy, Bossio said that
it was clear from the meeting with Cheppi that his
proposals, although well-intentioned, are nothing more than
outlines and that he is asking the sector for more time to
define policies.


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Agricultural Conflict Still Unresolved
--------------


5. (SBU) Bossio stated that, although the variable export
tax scheme was defeated in the Congress, there remain many
unresolved agricultural sector issues. Particularly, within
the past 3-4 years, milk and beef production have seen
significant declines due to the lack of a stable, long-term
agricultural policy. In addition, exports are impeded by
overregulation, with numerous regulations created just within
the past few months. He said that those regulations will
need to be revised to provide positive incentives and
stimulate production.


6. (SBU) Bossio also mentioned that farmers have difficulty
making prudent decisions in a market where the government
changes the rules of the game from one week to the next.
Added to that uncertain policy environment is the farmers'
lack of negotiating position against the major exporters,
whom he suggested are somewhat cartelized. He indicated that
these are all issues that will need to be addressed.

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What Do Farmers Want?
--------------


7. (SBU) Bossio said that farmers' primary objective is to
convince the government to develop and implement a long-term
agricultural policy that provides clear and stable rules of
the game. The three most critical issues are beef, dairy,
and regional economic issues. Beef is at the top of that
list. FAA has 20 different farmer assemblies and in almost
every one, he said, the most important topic of discussion is
beef cattle production. He said that due to the chronically
declining production, the situation has become "terminal"
for many producers. He also mentioned that the FAA is
working together with other groups to prioritize goals and
find consensus on positions including legislative affairs, a
proposal to freeze land rental prices and contracts which
the smaller farmers favor, and the agricultural sector's
disproportionate tax burden.

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Ag Strategy: Lobby and Educate
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8. (SBU) Meacham asked whether farmers would protest future
government actions by blocking roads or if they will change
their strategy. Bossio indicated that although it was the
most effective method early in the strike, the agricultural
leaders realized that blocking roads was not the best
long-term approach to stimulate favorable changes and
support. He pointed out that throughout the conflict, the
Mesa de Enlace tried to cool tensions when the government was
trying to heighten the conflict.


9. (SBU) Instead of creating the social unrest associated
with blocking roads that occurred earlier in the strike, the
farm groups have become much more organized and are better at
utilizing less confrontational tactics to get their message
across. For example, through the Liaison Table, they are
reaching out to a receptive press, as well as to lawmakers.
Although they would like to negotiate with the Secretariat of
Agriculture, they also recognize the necessity to work within
the Congress. Earlier this week, the Table met with several
institutions and congresspersons to discuss potential bills.
Bossio indicated that several Members of Congress had ideas
for draft legislation but that they were largely hollow. He
explained that there is a large knowledge gap which the Table
will try to fill through petitioning and educating lawmakers.

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What's on the Horizon?
--------------


10. (SBU) When asked about the future, Bossio said that
another important date on the horizon is August 23. On that
Saturday, an assembly of producers in Olavarria will meet to
discuss strategies for changing onerous rules that impede
beef exports, as well as to demand regulations that will
create incentives to increase beef cattle production. Bossio
said that he mentioned that date not as a warning that
producers will go back on strike, but rather, highlight
producer expectations to see positive changes from a
government that has yet to make any significant advances
after the defeat in Congress of its variable export tax

proposal. He acknowledged, however, that it is highly
unlikely that any of these issues will be resolved by August

23. Bossio said that the agricultural sector has decided to
focus future protests in a more "civic" way by pressuring
legislators and chipping away at the current political
structure little by little.


11. (SBU) Bossio denied rumors that the ag sector has any
plans or intentions of forming its own political party. They
are currently focused on achieving consensus in their own
assemblies so that the Liaison Table can present proposals to
the Argentine Congress in the next few months.

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In Search of an Ag Policy...
--------------


12. (SBU) When asked whether rural groups are looking at
agricultural policy models from other countries on which to
base some of their proposals, Bossi said the ag sector likes
parts of the EU, U.S., and Australian policies, as well as
French and Cuban programs. He mentioned that he traveled to
Cuba and looked at their National Association of Small
Farmers (ANAP) program created for small producers. FAA and
the other rural organizations recognize that all models have
useful ideas, but they do not want to import any one
particular model. Rather, they plan to incorporate many
ideas from various countries to create an Argentine model,
Bossio said.

-------------- ---
...That Does not Involve a National Grains Board
-------------- ---


13. (SBU) One idea that was briefly mentioned was the
creation of a new type of agricultural marketing board.
Bossio indicated that small producers could support such an
entity if it were structured in the right way. When asked
about a recent bill introduced in the Congress that would
grant the Agricultural Control Office (ONCCA) power to buy
and sell agricultural products, thereby creating a new "Junta
Nacional de Granos" (National Grains Board) with control
over all agricultural products (which has been referred to as
Enpycca, and later termed "Super ONCCA" in press reports),
Bossio stated that the agricultural sector's reaction would
be strongly negative if the measure was passed and
implemented. He clarified, that at this point there is not
enough political support for that proposal to have any future
-- at least in its current form.

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Argentina's "Broken" Political Machine
--------------


14. (SBU) Turning to a discussion on the state of Argentina's
democracy, Bossio noted that part of the problem is an undue
concentration of power within the executive and the Peronist
Party (PJ). He explained that the reason why politicians and
officials do not effectively represent the interests of their
constituency is because they are beholden to the executive.
"In order to have political autonomy, you need economic
autonomy," he said. He noted that three of Argentina's
strongest agricultural provinces, Santa Fe, Entre Rios, and
Cordoba, generate an enormous amount of federal revenues
through commodity export taxes, but the nature by which the
federal government returns those contributions to the
provinces is arbitrary.

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Comment
--------------


15. (C) Despite the agricultural sector's vehement complaints
against GOA agriculture policies under the two Kirchner
administrations, it is clear that CFK's intransigence in
dealing with the sector has done more to help unite the
sector than any previous administration. In the face of
CFK's divide-and-conquer strategy, the four agricultural
organizations (FAA, CRA, SRA, and Coninagro) successfully
created the Liaison Table, which was instrumental in
pressuring Congress to defeat Resolution 125. Post contacts
all indicate that the agriculture sector is committed to
maintaining that level of solidarity and cooperation via the
Liaison Table. However, it remains to be seen whether this
alliance can hold in the long run, given that each group has
different (and, on some issues, opposing) interests which CFK
may use to play off one group against the others. In the
days following CFK's August 2 press conference where she
E

asserted that she "would do it all over again," the GOA has
made some overtures to the ag sector, with Secretary of
Agriculture Cheppi and Cabinet Chief Sergio Massa meeting
with ag leaders in the last week. It is unclear, however,
whether the GOA intends to use this new round of engagement
to work with, or exert even greater control over, the sector.
As reftel reports, the GoA may prefer to take another stab
at dividing and conquering Argentine farmers. End comment.


16. (U) This cable was cleared by Staffdel Meacham and
WHA/BSC Bruce Friedman.
KELLY