CHILE MEDIA REPORT ? NOVEMBER 20

UNCLAS SANTIAGO 001021 SIPDIS STATE FOR R/MR, I/PP, WHA/BSC, WHA/PDA, INR/IAA E.O. 12958: N/A TAGS: KMDR KPAO PGOV OPRC PREL PGOV EFIN CI SUBJECT: CHILE MEDIA REPORT ? NOVEMBER 20 MAJOR STORIES -------------- ¶1. 30,000 workers march in Valparaiso for the third day of the Association of Public Employees (Anef) strike. There were no incidents; Chile will face its first fiscal deficit in six years due to the drop in copper revenues. U.S. Related -------------- ¶2. Editorial ?U.S. Economic Measures?: ?It?s very likely that history will hold U.S. Secretary of the Treasury Henry Paulson largely responsible for the current financial crisis.... But his most recent decisions seem to be heading in the right direction. Last week he announced his decision not to buy toxic financial assets... and now opposes a bailout plan for the automobile industry.... Saving inefficient companies is not a good way to invest public resources and that is a lesson Chile must learn.... It?s also wise to leave part of the financial bailout resources for the next administration. Basically, the government is doing what it must do, which is to help create liquidity for the economy through an array of initiatives? (El Mercurio, conservative, influential newspaper-of-record, circ. 129,000). ¶3. Foreign Minister Alejandro Foxley is proposing opening five new seats in the G20 for countries such as Chile. Foxley will discuss this idea with U.S. Secretary of State Condoleeza Rice in a bilateral meeting at APEC (La Tercera, conservative, independent, circ. 101,000). ¶4. The Court of Appeals confirmed proceedings against former Air Force (FaCh)intelligence agent Rafael Gonzalez for the murder of American citizen Charles Horman, who was killed after the 1973 military coup. Gonzalez has testified that he interrogated Horman in General Augusto Lutz? office and that the general ordered Horman killed. The trial began in October 2003, but Lutz is no longer alive (La Nacion, government-owned, editorially independent, circ. 4,200). ¶5. Extensive photo coverage of the Embassy?s Election Night at the InterContinental Hotel (Caras and Ercilla magazines). ¶6. Editorial: ?The leaders at APEC will have to decide on how to face the current crisis with agility and countries such as the United States, Japan or China will have to show how they intend to stop the crisis from deepening further (La Nacion). Local -------------- ¶7. On the third day of the national public employee strike, 30,000 workers congregated in Valparaiso to reaffirm their salary demands, as union leaders met with congressmen. The government had proposed a graduated increase of up to 10 percent for the lower income bracket, but congressmen insisted on an equal increase for all. The government then proposed an overall 9.5 percent increase, but workers argue that this would amount to only a 5.5 percent real increase, due to the current inflation rate. The President of the Exporters Association (Asoex),Ronald Bown, says the strike is severely hurting exports, adding that it could result in suits for breach of contract (El Mercurio). ¶8. Mexican President Felipe Calderon will arrive in Santiago today. Mexican Ambassador Mario Leal said this will be a good opportunity for both countries to ?coordinate their stance in international fora,? on an array of issues, such as UNASUR. Chile and Mexico signed an FTA in 1999 that was complemented with a Strategic Association Agreement (El Mercurio). ¶9. Attorney General Sabas Chahuan appointed eleven prosecutors to prosecute violations of environmental, public health, nuclear security, and cultural patrimony laws (La Nacion). ¶10. The Capital Goods Corporation (CBC) reports that investment projects amounting to US$2.36 billion have been postponed due to the international financial crisis (El Mercurio). ¶11. Chile will face its first fiscal deficit in six years, due to the drop in the price of copper and Molybdenum (El Mercurio). SIMONS *********************** Cecilia Pe$afiel U.S. Embassy Santiago e-mail: penafielcx@state.gov ***********************