Identifier
Created
Classification
Origin
08MONTEVIDEO539
2008-09-19 16:07:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Montevideo
Cable title:  

SOLID ECONOMIC TEAM TAKES OVER MINISTRY OF ECONOMY

Tags:  ECON ETRD PINR UY 
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RR RUEHWEB

DE RUEHMN #0539/01 2631607
ZNR UUUUU ZZH
R 191607Z SEP 08
FM AMEMBASSY MONTEVIDEO
TO RUEHC/SECSTATE WASHDC 8489
INFO RUCNMER/MERCOSUR COLLECTIVE
RHEHNSC/NSC WASHDC
UNCLAS MONTEVIDEO 000539 

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ECON ETRD PINR UY
SUBJECT: SOLID ECONOMIC TEAM TAKES OVER MINISTRY OF ECONOMY

UNCLAS MONTEVIDEO 000539

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ECON ETRD PINR UY
SUBJECT: SOLID ECONOMIC TEAM TAKES OVER MINISTRY OF ECONOMY


1. (U) On September 18, Alvaro Garcia replaced Danilo Astori as
Uruguay's Minister of Economy and Finance, allowing Astori to begin
in earnest his campaign for the Presidency. In his market-friendly
inaugural speech, Garcia committed to continue sound macro policies
and fight inflationary pressures, which he saw as a precondition to
consolidate economic stability, improve the business climate and
attract foreign investment. According to Garcia, the above
conditions are vital to establish income distribution policies that
will make Uruguay a "more cohesive and fair" country. He plans to
support research and development, incorporate knowledge into exports
of goods and services, promote entrepreneurial skills and strengthen
the development of small and medium firms. Astori meanwhile, will
begin his campaign for President in earnest; he is one of the
current favorites to win the governing Frente Amplio's nomination
next June.


2. (SBU) Garcia's public statements yesterday echo what he told
Ambassador during a courtesy call in July shortly after he had been
named as Astori's replacement.

GARCIA'S PROFILE
--------------

3. (SBU) Garcia, 45, is trained as an economist and a member of the
Socialist Party. He is married and has two children. From June
2005 through April 2008 he was president of Uruguay's National
Development Corporation (CND in Spanish),a traditionally ill-run
institution that is widely recognized to have improved under his
leadership. Since April 2008 Garcia has worked in the creation of
the National Agency for Innovation and Research (ANII in Spanish),
reportedly per President Vazquez' request. From 2002 through 2005
he worked as Manager of Planning and Costs Control Division at
Pirelli4s Cabos Energy and Telecommunications Company in Sao Paulo,
Brazil. From 1986 through 2002 he worked as Accountant, Chief of
the Accountancy Division, and Manager of Administration and Finance
at Pirelli-owned firm Citesa.


4. (SBU) EDUCATION AND TEACHING EXPERIENCE: Garcia earned his
Public Accounting degree at Universidad de la Republica in 1985 and
his Postgraduate in Finance degree from ORT University in 1995.
From 1995 through 2002, he taught Accountancy and Pricing, Superior
Accountancy I and Superior Accountancy II at Universidad de la
Republica and Universidad Catolica. In 2006 he taught Managerial
Accountancy at Universidad ORT.


5. (SBU) PERSONAL INTERESTS AND LANGUAGE SKILLS: An accomplished
musician, Garcia prepared lyrics and music for Uruguay's carnival
from 1989 through 2004. His lyrics have been performed by several
well-known local artists. He has himself performed in some
recordings. He is fluent in Spanish and Portuguese. He makes an
effort to speak English but is not fluent.

DEPUTY MINISTER MASOLLER'S PROFILE
--------------

6. (SBU) Incoming Deputy Minister Andres Masoller previously served
at the ministry's Macroeconomic Advisory Unit and Central Bank as
Chief of the Economic Analysis Division of the. Born on April 9,
1964, he graduated as an Economist from the University of the
Republic in Uruguay. He holds a PhD in Macroeconomics, Finance and
International Economics from the University of California (UCLA) in
Los Angeles, where he was a Fulbright grantee. He has taught
International Finance at the University of the Republic and is
author of several publications.

PROFILE OF NEW DIRECTOR OF MACROECONOMIC ADVISORY UNIT
-------------- --------------

7. (SBU) Michael Borchardt, who will be the new director of the
Macroeconomic and Financial Advisory Unit -- one of the Ministry's
key policy making offices-- has been working in the unit since 2005.
He previously worked at the Central Bank and CERES, a
market-oriented economic think tank with a reputation for
independence.

LOCAL REACTION
--------------


8. (SBU) Businessmen who know him well described Garcia as
ideologically on the left, but pragmatic and more open to some
degree of privatization than many of his Frente Amplio cohorts. He
is considered a very effective speaker. Many expect Garcia will not
be as independent as Astori, and will be more likely to respond to
direct requests from the President. One said Garcia only made
"exceptions" to the approval process at CND on three occasions,
responding directly to requests by President Vazquez. They expect
his tenure will keep the Ministry on "auto pilot" until President
Vasquez' term expires in March 2010.

COMMENT
--------------

9. (SBU) We expect Garcia will do exactly as he says and maintain
the sound economic policies of his predecessor. He will be able to
dodge the inevitable pressure for new spending, since after October
there is an election year moratorium on budget increases. We expect
continued good access at the Minister as Garcia has proven quick to
search out the Ambassador and emboffs at social functions.

BAXTER