NICARAGUA'S FOOD SUMMIT: IF YOU HOLD IT, THEY MAY

UNCLAS SECTION 01 OF 03 MANAGUA 000610 SENSITIVE SIPDIS STATE FOR WHA/CEN, WHA/EPSC, EEB, AND IO/EDA USUN ROME FOR AMB. VASQUEZ AND LDEVALCOURT E.O. 12958: N/A TAGS: EAGR ECON EAID PREL NU SUBJECT: NICARAGUA'S FOOD SUMMIT: IF YOU HOLD IT, THEY MAY NOT COME. ¶1. (SBU) Summary: On May 7, President Ortega held a "Food Sovereignty and Security Presidential Summit: Food for Life." It was to be headlined by Venezuela's Hugo Chavez and attended by 11 Latin American and Caribbean presidents. However, at the last minute Chavez, pleading illness, canceled and four other presidents did not show. President Arias of Costa Rica and the Salvadoran Foreign Minister refused to sign the Summit Declaration due to its criticism of free trade and its heavy ALBA focus. Chavez' failure to attend did not staunch the rhetoric, however, as the presidents of Bolivia, Haiti, Ecuador, and Honduras all made statements blaming the United States, neoliberalism, and free trade for the current global food price crisis. Venezuela's Foreign Minister Maduro tabled a seven-point plan which will be considered at a technical meeting Mexico offered to host on May 28-29. Food security will also be a topic at the upcoming Fifth Latin America, Caribbean and European Union Summit taking place in Lima May 16-17. While billed as a serious effort to find solutions to food security concerns, Ortega's summit was in fact designed to be the ideological launching pad for an ALBA program for "food sovereignty." End Summary. Lofty Ambitions... -------------- ¶2. (U) In mid-April, with much fanfare, President Ortega announced that on May 7 he would host a "Food Sovereignty and Security Presidential Summit: Food for Life," presided over by Venezuela's Hugo Chavez and attended by 11 Latin American and Caribbean presidents. The event was engineered to showcase Nicaraguan President Daniel Ortega's leadership position in the Americas. The Summit was to conclude with the signing of a Food Sovereignty Declaration that would set out strategies for the countries to address the current food security crisis. Another goal was to receive pledges for a USD 640 million fund for projects to increase agricultural production in 2008-2009. Chavez' offer of a USD 100 million line of credit several weeks ago was to form the core of this fund. Crash to the Ground... -------------- ¶3. (SBU) By all measures, the Summit was a failure. At the last minute Chavez did not attend, claiming illness. The presidents of Mexico, Guatemala, the Dominican Republic, and El Salvador also declined the invitation, sending their Foreign Ministers. Costa Rica's President Oscar Arias did attend, but walked out half-way through, refusing to sign the Food Sovereignty Declaration because it criticized free market economics and emphasized the Bolivarian Alternative for the Americas (ALBA) as the way forward. El Salvador's Foreign Minister also declined to sign, stating that one should separate ideology from practical programs. The Agricultural Production Fund was not discussed after it became clear no one was prepared to make pledges. The only president with a concrete plan was Haiti's Rene Preval, who announced that his government would subsidize the price of flour, rice, and cooking oil for the next six months. ¶4. (U) During press interviews following Costa Rican President Arias' walk-out, he expressed appreciation for Venezuela's offer of a USD 100 million line of credit, but added that any Central American country can approach the Central American Bank for Economic Integration (CABEI) for a similar deal "without any ideological conditions attached." In fact, CABEI president Harry Brautigam announced at the summit that the bank is studying a proposal to provide a total of USD 250 million in lines of credit for agricultural production to the Central American countries. The program would finance the production of basic grains, storage infrastructure and improvements linked to agricultural logistics. But Rhetoric Remained Lofty -------------- ¶5. (U) Chavez' absence did not result in a reduction in rhetoric. The presidents of Bolivia, Haiti, Ecuador, and Honduras all made statements blaming the United States, neoliberalism, and free-trade for the current global food price crisis. - Nicaragua: Ortega labeled free-trade as the "principal enemy of the people;" adding that "food cannot remain under the rules of supply and demand as this impoverishes both consumers and producers for the enrichment of the middleman." - Ecuador: Correa emphasized the need to spur domestic agricultural production while eliminating free-trade practices. - Bolivia: Morales equated capitalism to death, claiming that the U.S. would not help with the crisis. He called for the governments present to work with their local agricultural producers and social movements to develop a solution. - Honduras: Zelaya complained of the slow response by international financial institutions and claimed neoliberal policies relegated the state to the role of passive observer of hunger. - Cuba: Vice President Lazo blamed high world food prices on high oil prices, which he attributed to the war in Iraq, climate change, and U.S. and EU neoliberal economic policies. - Costa Rica: While Arias criticized the U.S. for offering just USD 1 billion to resolve the food crisis, "an amount the United States spends in half a week in Iraq," he urged the Latin American nations to "do their homework and not depend on the international community for solutions." He advocated effective fiscal policies "as a way to strengthen countries and their productive sectors." Highlights from the Summit Declaration -------------- ¶6. (U) Instead of a road map to food sovereignty, as it was touted, the Summit Declaration was essentially an ideological document. It blamed high food prices on U.S. and EU agricultural subsidies, biofuel initiatives, and neoliberal economic policies. The Declaration highlighted regional frameworks which could implement a Latin American response to the crisis, with ALBA boasting the highest billing. It called on international organizations to quickly disburse short term credits for agricultural production. Signatory countries are to subsidize agricultural production through credits to producers; require banks to dedicate 10% of their portfolio to agricultural production; and, create funds that ensured agricultural producers received financing, technology, tools, machinery, inputs and fair prices. The Declaration also required the signatories create National Action Plans on Food Security and Sovereignty that reflect the principles of "Solidarity and Cooperation, Complementarity and Recognition of Asymmetries and Fair Trade between and within countries (fair prices for consumers and producers.)" Only ALBA member countries (Nicaragua, Venezuela, Haiti, Bolivia, and Cuba) signed the document. Full text of the Declaration in Spanish can be found at: www.presidencia.gob.ni. ¶7. (U) Venezuela's Foreign Minister Maduro tabled a seven-point plan during the summit, which was annexed to the Declaration. The plan called for: 1) an Agrarian Bank to reduce the costs for small and medium producers; 2) USD 100 million from Banco ALBA to finance agricultural development projects in Central America; 3) a special plan within Petrocaribe (subsidized Venezuelan oil) to finance agricultural production; 4) strengthening governments through a special tax for the creation of a Special Agricultural Fund; 5) transferring lands confiscated from drug traffickers to farmers; 6) establishing an agricultural research center; and 7) convening a summit of petroleum producing countries to explore a "petro-agrarian solution," that would support the Agricultural Fund. Technical working groups are supposed to study the Venezuelan proposals and prepare a report for consideration at a technical meeting the Government of Mexico has offered to host on May 28-29. Peru's Ambassador to Nicaragua also announced that food security will be a central issue for the upcoming Fifth Latin America, Caribbean and European Union Summit taking place in Lima May 16-17. Comment -------------- ¶8. (SBU) While the Summit was originally billed as a serious endeavor to find solutions to current food security issues, agriculture ministers who attended the April 26 preparatory meeting in Managua, quickly realized that the event would not be much more than a launching pad for an ALBA program for "food sovereignty" to compete with solutions being developed by western donors. The lack of high level participation and final agreement were a clear rejection of Ortega and Chavez' attempt to politicize a serious problem, and added an additional sour note to a difficult week in Nicaragua, also marred by a national transportation strike. TRIVELLI