SENATOR BOND AND ACTING FM VALENCIA ON COLOMBIA,

S E C R E T QUITO 000851

NOFORN
SIPDIS

E.O. 12958: DECL: 09/10/2018
TAGS: PREL SNAR PTER MARR PINR ETRD ECON ENRG EC
CO, BR
SUBJECT: SENATOR BOND AND ACTING FM VALENCIA ON COLOMBIA,
COUNTERNARCOTICS, TRADE

Classified By: Ambassador Heather Hodges for reasons 1.4 (b&d).


1. (S/NF) Summary: In a meeting with Ecuador,s acting
Foreign Minister, Senator Bond (R-MO) urged that a mechanism
be found to continue counternarcotics flights by USG civilian
agencies after the U.S. Forward Operating Location in Manta
closes in 2009. He stressed the USG interest in military,
intelligence, and development cooperation. Acting FM
Valencia assured him that the GOE is committed to combating
the FARC. Valencia also said that the Ecuadorian and
Colombian Foreign Ministers agreed to re-start a
vice-ministerial level dialogue. Valencia defended the draft
constitution as providing for greater regulation, not a
centrally planned economy. Other topics were the Andean
Trade Preference Act and petroleum contracts. (End summary)

BOND URGES MODUS VIVENDI


2. (C) In an August 18 meeting, Senator Christopher "Kit"
Bond (R-MO) expressed regret over misunderstandings and
miscommunication between the Ecuadorian and Colombian
governments and asked about the meeting between their Foreign
Ministers on August 15. He highlighted serious concerns
about Revolutionary Armed Forces of Colombia (FARC) presence
on Colombia's southern border and the entry of Colombian
guerrillas into northern Ecuador, where they obtain weapons
and other supplies. He spoke positively of his August 16
meeting with Ecuadorian military leaders in the northern
border area.


3. (C) Senator Bond expressed the USG's desire to support
both the GOE and GOC in their fight against narcotics
trafficking. He said he understood the U.S. Forward
Operating Location in Manta was an issue during President
Correa's campaign and that it would be closed when the
agreement expires in 2009. However, he hoped a place could
be found so that the Coast Guard, DHS, and DEA could continue
to operate in this strategic location. Bond emphasized that
our governments need to find a modus vivendi to allow the
United States to assist the Ecuadorian military and
intelligence services.

VALENCIA OPTIMISTIC ON COLOMBIA TALKS


4. (C) Acting Foreign Minister Jose Valencia said the timing
was right for the meeting between Ecuadorian FM Maria Isabel
Salvador and Colombian FM Jaime Bermudez, which took place
under OAS auspices in Paraguay. The meeting allowed the two
ministers to begin to establish a relationship. Salvador and
Bermudez decided at that meeting to resume consultations
between their Vice Ministers.


5. (C) Valencia said Ecuador felt its sovereignty had been
seriously violated by the Colombian incursion on March 1,
when Colombia chose not to use existing channels for military
and intelligence coordination and deceived Ecuador by
providing partial and unclear information. He complained
that the GOC selectively leaked documents from the laptops to
give the impression the GOE was tolerating the FARC, which
was never the case. Valencia said GOE contacts were only for
humanitarian purposes (meaning release of FARC-held
hostages). He pointed out that information on the laptops
about senior officials of a third country (Brazil) was not
similarly leaked. Valencia said Colombian government
statements about Ecuador had not helped in re-establishing
relations.


6. (C) Valencia said the GOE and GOC had made progress
during recent talks. One issue was reparations that Colombia
should provide for border incidents that affect Ecuadorians.
In one case, according to Valencia, the Colombian Army had
recognized that it erred and killed Ecuadorian civilians, but
no payment was made. Resolving these issues would allow the
two countries to turn a new page. He expressed optimism that
the two governments could move toward normalization of
relations based on mutual respect.

VALENCIA DEFENDS GOE EFFORTS IN NORTH


7. (C) Valencia expressed Ecuador's appreciation for U.S.
cooperation, which he hoped would continue. He emphasized
the GOE's commitment to continue efforts against irregular
groups, narcotics traffickers, and Colombian criminal groups
(noting that these groups overlapped). Valencia highlighted
the difficulty of the terrain in the northern border region
and the impossibility of 100% control, but said the GOE was
doing everything it could. Valencia cited Ecuadorian
achievements, including seizing camps, cocaine laboratories,
precursor chemicals, arms caches, and people linked to these
activities. Thanks to Ecuadorian efforts, there was almost
no cultivation in the country. Valencia criticized the
limited Colombian presence near it southern border, saying
the GOC needed more forces and outposts in the area.


8. (C) Valencia highlighted the important benefits Ecuador
accrues under the Andean Trade Preferences Act (ATPA),
including employment generation and attracting U.S.
investors. While the FOL agreement would not be extended, he
said, the GOE wants to continue other counternarcotics
cooperation with the U.S. and other countries in the region.
Valencia said the GOE was open to discussing new forms of
cooperation based on shared interests.

BOND ADVOCATES COUNTER-DRUG, INTEL COOPERATION


9. (C) Senator Bond said both Ecuador and Colombia were good
friends of the United States and expressed hope that the two
governments could work out their differences. He described
Colombian President Uribe as having done more than anyone to
get the FARC under control. Bond said he was impressed by
USAID programs that he had visited in Ecuador's northern
border region and wanted them to continue. He believed
deeply that the only long term solution to illegal activity
was to provide licit employment opportunities so people could
support their families. He said he would seek funding to
continue USAID programs.


10. (S/NF) Senator Bond stressed the importance of continued
dialogue on U.S. military, technical, and other assistance.
He emphasized the need to reach an understanding on how we
can best assist Ecuadorian military operations in the future.
Bond emphasized that he and others in Congress want to see
how counternarcotics operations could be continued without
the FOL, noting that 60% of seizures in the Western Pacific
were thanks to information provided by FOL flights. He noted
the U.S. couldn't help Ecuador flying out of Miami.


11. (S/NF) Senator Bond said U.S. intelligence agencies
collect information where we have grave concerns, and that he
hoped the GOE would remain open to receiving that
intelligence. That way it could better fight narcotics
traffickers. If there were information about Ecuadorian ties
with illegal groups, it would be better for the GOE to act
before the word got out to others. Bond said that the
Ambassador could arrange a briefing with the proper people so
that the GOE would know what we can share.


12. (S/NF) Senator Bond said the USG could provide useful
current intelligence to the Ecuadorian military if the GOE
were willing to receive it. He noted that we make the same
offer to other friendly governments. Bond said we would work
to comply with Ecuador's own standards in doing so. He
assured Valencia that the USG was not behind Colombia's
selective leaking of information from the laptops, and that
we share intelligence in a confidential manner. Valencia
responded that the GOE was open to intelligence cooperation
on the basis of bilateral agreements between our governments.

ECONOMIC POLICY THREATENS FREE MARKET?


13. (C) Senator Bond said the American Chamber of Commerce
members he met were happy in Ecuador, but nervous about its
future. He described different articles of the draft
constitution as sending conflicting signals about the
country's direction. Energy companies were particularly
concerned about whether their operations could continue.
Investors were waiting to see the direction of GOE policies.
Bond urged that Ecuador continue a market economy without

excessive government control so that businesses could
operate. He said his view is that well-regulated American
investment is helpful to the host country. Bond noted as an
example the employment benefits of the flower industry.


14. (C) Describing himself as a free trader, Bond explained
that he was fighting protectionists in the Senate. He knew
the Andean trade preferences were near expiration, lamenting
that the Senate majority did not share its plans with the
minority.


15. (C) Valencia replied that the GOE shares Bond's interest
in business ties. He said the new constitution is clear in
requiring regulation of the economy, but does not provide for
a planned central economy. Greater regulation could co-exist
with a free market and contribute to social progress. The
GOE sought to allow the market to work, such as reducing
tariffs on imports of capital goods, which helped make
Ecuadorian businesses more competitive. It was also focused
on reducing utility rates and providing access to credit.
None of its actions were intended to do away with the private
sector, according to Valencia.


16. (C) Valencia recognized concerns about re-negotiation of
petroleum contracts, but said other countries had taken
similar actions when the basic parameters of earlier
contracts had changed. He said the GOE was trying to use
petroleum resources to promote development, but knew the
resource would only last a couple of decades. Then the
Ecuadorian economy would have to be able to walk on its own.
Bond cited Missouri's "Show Me" slogan -- beyond discussion
of economic policy, what counted would be what actually
happened.

BILATERAL DIALOGUE AND FUTURE COOPERATION


17. (C) Valencia highlighted plans for a wide-ranging
bilateral dialogue, including topics like trade barriers,
counter-narcotics cooperation, and extraditions. Bond
promised that he would do what he could to ensure that U.S.
cooperation continued and to assist the GOE in its
existential battle to protect its own sovereignty.


18. (U) Senator Bond's chief of staff cleared this cable.

Hodges