VENEZUELAN GOVERNMENT IGNORES USG WARNING ON PORT

C O N F I D E N T I A L SECTION 01 OF 02 CARACAS 001546 SIPDIS HQ SOUTHCOM ALSO FOR POLAD TREASURY FOR MMALLOY COMMERCE FOR 4431/MAC/WH/MCAMERON E.O. 12958: DECL: 01/01/2018 TAGS: VE ASEC MARR PGOV ECON EAIR EWWT ETRD KHLS PTER, PREL SUBJECT: VENEZUELAN GOVERNMENT IGNORES USG WARNING ON PORT SECURITY REF: A. STATE 106573 ¶B. CARACAS 1364 CARACAS 00001546 001.3 OF 002 Classified By: Economic Counselor Darnall Steuart for reasons 1.4 (b) and (d). ¶1. (C) Summary: The Bolivarian Republic of Venezuela (GBRV) has not responded to two diplomatic notes and multiple Embassy requests for a meeting to discuss U.S. Coast Guard efforts dating back to 2006 to arrange port visits. Embassy maritime contacts believe that Venezuelan ports would not pass inspection. The Venezuelan government does not appear to be concerned with the latest warning from the USG on security-related matters as it seems to believe that, similar to its experience with the TSA Public Notice, the consequences for ignoring the USG warning will be minimal. End Summary. ¶2. (C) After trying through its own channels since 2006 to try to arrange a port assessment under the International Ship and Port Facility Security Program (ISPS),the U.S. Coast Guard contacted the Embassy and asked that it formally request an ISPS visit. The Embassy sent the request to the Ministry of Foreign Affairs (MFA) via diplomatic note in May 2008 with a copy to the Institute of Aquatic Spaces (INEA). Post has followed up on the note with the MFA twice a week since. Following receipt of reftel A instructions, the Embassy delivered a second diplomatic note on October 7, informing the GBRV that the U.S. Coast Guard had decided to give the GBRV 30 days to schedule an ISPS visit or it would impose "conditions of entry" which will require that "vessels which called at Venezuelan ports take additional security measures.." which could "subject them to considerable delay, additional expense and possible denial of entry into the United States." As of November 6, the GBRV has not responded. -------------- INDUSTRY COMMENTS -------------- ¶3. (C) On October 31, Econoffs met with Nelson Maldonado, former Venezuelan Merchant Marine Captain and President of the powerful Venezuelan trade association Consecomercio. Maldonado stated he doubts Venezuelan ports would pass a Coast Guard inspection as they are currently run by "mafias." He described INEA as one of the mafias and added that the Venezuelan National Guard cannot be trusted either. Maldonado said the new head of INEA is a young Air Force Major who has "no idea what he is doing." He noted that Venezuelan petroleum company PDVSA does not send its tankers to U.S. ports as they do not meet U.S. standards. ¶4. (C) On November 5, Econoffs met with the General Manager of Intermarine South America Fernando Maruri (strictly protect throughout). Intermarine is a U.S. company that handles up to 90 percent of all oil industry cargo destined for Venezuela. In a back-of-the envelope calculation, Maruri estimated that the additional security measures might cost his company USD 25,000 per day of delay in entering Houston/Galveston. Intermarine sails to Houston approximately 20 times a month. Maruri added, however, that the GBRV would not care in the least about this extra expense as it is "not organized enough to even think to analyze such a cost increase." He added that Venezuelan ship owners and operators would not be concerned about the Coast Guard "conditions of entry" either as they would simply pass the additional cost on to their major client, the Venezuelan government, or to consumers. ¶5. (C) Maruri speculated that the GBRV would never allow the ISPS visit as it is "scared the U.S. government will find out what is going on at the ports." He added that he knows the ports are deficient on security as the GBRV has not maintained security measures that were in place during the 2004 Coast Guard inspections. He added that it used to be difficult to access the ports, but now anyone can wander into most ports. Maruri suggested that INEA had no voice in the GBRV's decision not to respond to the Embassy and any decision on the ISPS visit will be made at the highest levels of the government without consulting INEA. Nevertheless, Maruri committed to call his government contacts in support of the ISPS visit as he is concerned that if the Coast Guard decides to delay his ships, it would cost his company a great CARACAS 00001546 002.3 OF 002 deal of money. ¶6. (C) COMMENT: The GBRV is aware of the consequences of refusing an ISPS visit but seems to have decided they do not warrant the alteration of the BRV stance against the "extraterritorial application" of U.S. law which was spelled out so strongly in its response to the TSA Public Notice (ref B). Based on reports from industry contacts, post believes the GBRV is under the impression that any Coast Guard action would have a negligible impact on its interests and it has little to no concern about the potential impact on the private sector. It is unlikely that the "conditions of entry" will encourage the GBRV to allow an ISPS visit unless the conditions are implemented in such a way as to seriously impede the flow of dollars to the Venezuelan government. In the absence of any contact with the GBRV on this issue, Post will continue its outreach to the private sector on port security. END COMMENT. CAULFIELD