VENEZUELA: TITLE III OF LIBERTAD ACT

C O N F I D E N T I A L CARACAS 001696 SIPDIS PLEASE PASS TO WHA/CCA E.O. 12958: DECL: 12/08/2018 TAGS: ETRD ETTC PREL VE SUBJECT: VENEZUELA: TITLE III OF LIBERTAD ACT REF: A. STATE 126578 ¶B. 2006 CARACAS 1096 ¶C. 2007 CARACAS 694 ¶D. 2007 CARACAS 597 ¶E. 2007 CARACAS 844 Classified By: Economic Counselor Darnall Steuart for reasons 1.4 (b) and (d). ¶1. (U) Post's response to Reftel A questions follow. ¶2. (C) Has the host country, in post's opinion, worked to promote the advancement of democracy and human rights in Cuba? Post sees no evidence that the Government of the Bolivarian Republic of Venezuela (BRV) has undertaken policies or actions to advance democracy, human rights, or fundamental freedoms in CUBA over the past year. ¶2. (C) Has the host country made public statements or undertaken other governmental actions, such as resolutions in the national assemblies condemning human rights abuses in Cuba; or actions in support of civil society in CUBA through host country's diplomatic missions or other fora? President Hugo Chavez is Cuba's closest ally, provides substantial resources to CUBA and has repeatedly and publicly praised the Cuban government. Chavez openly criticizes countries, including the United States, for commenting on the human rights situation in Cuba. The BRV makes it a point to vote with CUBA and against the United States in multilateral fora. In 2008, the Venezuelan National Assembly passed resolutions condemning the US embargo on CUBA and calling for the release of the five Cuban spies jailed in the United States. Also, the National Assembly inaugurated a Venezuelan-Cuban friendship group within its body. ¶3. (C) Have there been any high-level diplomatic visits between CUBA and the host country in the past six months? Visits by high-level Venezuelan Officials to CUBA In October 2008, BRV Culture Minister Hector Soto visited Cuba to attend the opening of the 21st Havana International Ballet, tour hurricane damaged theater facilities in Las Tunas Province and preside over an awards ceremony. In September, Chavez met with Fidel and Raul Castro during his stopovers in CUBA en route to and from China. In September, the BRV Defense Minister Gustavo Reyes Rangel Briceno led a Venezuelan delegation on a tour through the regions devastated by Hurricane Gustav, Pinar del Rio and Isla de la Juventud and met with President Raul Castro. In June, Chavez visited Havana where he met with Fidel and Raul Castro and other top Cuban leaders, including Vice President Carlos Lage Davila and Foreign Minister Felipe Perez Roque. In June, Venezuelan Education Minister Hector Navarro attended the Ibero-American Literacy and Elementary Education Congress in Havana. In late May, Venezuelan Foreign Minister Nicolas Maduro headed Venezuela's delegation to the 12th Cuba-Venezuela Political Consultation Meeting. Visits by Cuban Officials to Venezuela Cuban President Raul Castro is scheduled to attend the ALBA summit in Caracas on December 14. During November, Cuban Government Minister Ricardo Cabrisas attended the Third Extraordinary Summit of the Bolivarian Alternative of the Americas (ALBA.) In July, Cuban Vice President Carlos Lage Davila spoke at the 5th Petrocaribe Summit in Maracaibo (also attended by Cuban Basic Industry Minister Yadira Garcia Vera and Secretariat member Lina Pedraza),toured Zulia state and opened a health center. Also in July, Cuban Foreign Minister Felipe Perez Roque headed a delegation to the Seventh Conference of Communication Ministers of the Non-Aligned Movement held in Margarita Island, Venezuela. Perez Roque and Venezuelan President Chavez addressed the audience and denounced media dictatorships and the US media "warfare" against Cuba. In addition to the visits set forth above, Post is aware of Vice Minister level and military officer visits by both countries to the other. ¶4. (C) Did the host country offer or deliver humanitarian or other assistance to the Cuban people in the wake of major damage caused by Hurricanes Gustav (August 30) and Ike (September 8)? Chavez committed to providing every possible assistance to Cuba after Hurricanes Gustav and Ike ravaged Cuba. However, dates and dollar amounts of donations are not generally known. The press had reported that Venezuelan volunteers, including PDVSA employees and members of Mission Ribas, visited CUBA to carry out renovation projects, such as the repair of schools and homes damaged by the hurricanes. In September, the state oil company, PDVSA, announced that 7,500 kilograms of food and 100 tons of powdered milk were sent to Cuba by the Mission Ribas Foundation (a BRV social mission funded by PDVSA.) In November 2008, press reports also said that the BRV donated metal roof planks to repair houses damaged by the hurricanes. ¶5. (C) What is the nature of the investments (and names, if known) that host country businesses have in Cuba? What host country businesses participated in the Havana Trade Fair (November 3)? As reported in Reftel B, state oil company PDVSA and state-owned Venezuela Industrial Bank have offices in Havana. In addition, PDVSA entered into a joint venture with the Cuban Petroleum Company (CUPET) to operate the Cienfuegos oil refinery. Chavez inaugurated the refinery in December 2007 and it is expected to produce 65,000 barrels of petroleum products per day. In July 2008, the BRV promised to build additional oil refineries in Cuba. In September 2008, the Cuban government announced plans to restore the oil pipeline connecting the city of Matanzas with Cienfuegos oil refinery with the financial support of Venezuela. Specifics on financing and ownership of the pipeline were not provided. PDVSA and CUPET have also agreed to conduct joint exploration studies in the Gulf of Mexico and other areas in Cuban territory. In August 2008, the Maracaibo and Caribbean Shipyard (ASTIMARCA),a Cuban-Venezuelan joint-venture, began operations. Formed in 2006, ASTIMARCA is owned by the Venezuelan Ministry of Infrastructure and the Cuban Ministry of Transportation and will primarily repair PDVSA owned oil tankers. In July 2008, the BRV announced the formation of Aceros del ALBA CA, a steel company, with Cuba. A joint venture, Aceros is to produce 500,000 tons of steel a year and be located in Monagas state. Ownership was reported to be 51 percent Venezuelan and 49 percent by Acinox Steel Industrial Group of Cuba. In June 2008, the Greater Caribbean Telecommunications Company, a joint-venture between Cuba's Telecommunications Signal Transportation Company and Venezuela's Telecom, outlined progress made on a project to run a fiber optic cable on the ocean floor to connect CUBA and Venezuela. Although still in the planning stages, Greater Caribbean Telecommunications Company aspires to lay the first cable by the end of 2009. On January 2007, CUBA and Venezuela entered into a Memorandum of Understanding (MOU) for the construction of a joint steel factory, three oil and petroleum distillates storage facilities, a nickel factory; the incorporation of a mixed insurance company; and a study to evaluate the opening of a power station in Cuba. In December 2007, the Venezuelan social production company Petrocasa built 100 homes for the elderly and disabled in Cuba. Petrocasa supplied construction advice and the houses, which were made of PVC. In July 2008, the BRV promised to build an additional 100 Petrocasas in Cuba. We understand that the BRV and the Cuban government have entered into various MOUs to study the feasibility of joint ventures in several areas, including tourism, music production, film works and the production and export of rice. However, we have not been able to confirm establishment of any of these joint ventures. We also understand that Venezuelan private sector companies operate in Cuba, but we do not have a full listing of the companies or details of their operations. We are also unaware of BRV entities or individuals trafficking in confiscated property in Cuba. ¶7. (C) Are there any bilateral trade agreements between host country and Cuba? In July 2008, the annual conference of the Cuba-Venezuela Solidarity Movement was held in Caracas. During the conference, participants stressed continued cooperation between the countries in the areas of sports, agriculture and education. In January 2008, during the seventh meeting of the Cuban-Venezuelan Mixed Commission, representatives signed agreements for 76 projects, primarily in the area of food, agriculture and agricultural industry. Agreements were also signed for communications, sports, health, education and transportation projects, but neither government revealed any details regarding the projects. According to a PDVSA press release from January 2008, the 76 projects required an investment of 1.3 billion USD in 2008. Among the projects listed were 11 ethanol plants. In addition, one agreement covered basic engineering studies for an animal feed plant. Eighteen Venezuelan government ministries and twenty-one Cuban ministries were tasked with carrying out these projects. Between January and November 2007, Venezuela and CUBA signed over 42 bilateral commercial agreements. Post calculates that these often vague promises of joint cooperation and projects are valued at an estimated USD 5.72 billion (Reftel C.) Fourteen of these agreements were signed on October 15, 2007 and included petroleum exploration by PDVSA in Cuban waters, construction of the fiber optic telecommunications cable mentioned above, and the construction of a hotel on a Cuban key. On February 28, 2007, during the seventh meeting of the Cuba-Venezuela Intergovernmental Commission in Havana, participants announced the approval of 355 cooperation projects worth 1.5 billion USD, including an agreement to build 11 ethanol plants that process sugar cane (Reftel D.) On April 29, 2007, Venezuela, Bolivia, CUBA and Nicaragua signed numerous agreements in areas such as oil, education, health, finance, and culture to advance the Bolivarian Alternative for the Americas and the People's Commercial Treaty ALBA-TCP) (Reftel E.) Cuba and Venezuela signed an additional 14 agreements in December 2007. Several of the fourteen agreements were in the field of energy. Two agreements covered studies to increase the capacity of the Cienfugos refinery from 65,000 barrels per day to 108,000 barrels per day and a study to increase the capacity of the storage facility at the Matanazas terminal. In addition, an agreement was signed for the exploration and development of six hydrocarbon blocks in the Pinar del Rio province. Another agreement dealt with the development of chemical and petrochemical plants in the Cuban provinces of Ciego de Avila, Nuevitas and Sauga la Grande. It is not clear what the remaining agreements covered. According to the PDVSA press release announcing the signing of the agreements, 27 Venezuelan-Cuban joint ventures were operating in CUBA and the Cuban-Venezuelan Mixed Commission invested 1.5 billion USD during 2007. President Chavez and Castro signed the Integrated Cooperation Agreement (ICA) between CUBA and Venezuela on October 30, ¶2000. Under the 2004 amended terms of the ICA, Venezuela supplies 92,000 barrels of oil per day to CUBA in exchange for the following services in Venezuela: dentistry, optometry, diagnostic centers, rehabilitation units, medical equipment and medicine. CUBA also offers services in the following social missions: Mission Milagro (eye surgery for the poor),Deportes Barrio Adentro (sports in the Barrio) and Mission Barrio Adentro (health care for the poor in the Barrio.) Contacts allege that BRV imports from CUBA sometimes bypass customs and tax officials and enter Venezuela via military ports. These items are reportedly not considered in official trade statistics compiled by the BRV tax authority. ¶4. (C) Are there any exchange programs between host country and Cuba, including, but not limited to: scholarships for host country nationals to study in Cuba; Cuban-paid medical travel for host country nationals; and Cuban doctors working in host country? Venezuela and CUBA have wide-ranging exchange programs in many fields, including, but not limited to, medical care, education, sports, and journalism. According to the January 2008 PDVSA press release, 39,000 Cubans were working in Venezuela with almost 31,000 working in the health sector. A December 2007 PDVSA press release claimed that one in 53 Venezuelans had received medical treatment under Cuban-Venezuelan medical programs. According the Cuban government-controlled on-line newspaper, Granma International, 2,400 Venezuelan doctors are enrolled in Cuban education institutions. In January 2007, Chavez also announced plans to send 100,000 poor Venezuelans on all-expense paid vacations to Cuba. Venezuelans would travel on Cuba's state-run airline Cubana de Aviacion. In March 2007, approximately 1,500 Cubans were to visit Venezuela for tourism. CAULFIELD