Identifier
Created
Classification
Origin
09BUENOSAIRES686
2009-06-11 20:49:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Buenos Aires
Cable title:  

ARGENTINA: INPUT FOR LABOR SECRETARY SOLIS MEETING IN

Tags:  ELAB KTIP SOCI AR 
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VZCZCXYZ0001
OO RUEHWEB

DE RUEHBU #0686/01 1622049
ZNR UUUUU ZZH
O 112049Z JUN 09
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC IMMEDIATE 3859
RUEHC/DEPT OF LABOR WASHINGTON DC IMMEDIATE
RUEHGV/USMISSION GENEVA 0765
INFO RUCNMER/MERCOSUR COLLECTIVE
UNCLAS BUENOS AIRES 000686 

DOL FOR ILAB CHANTENIA GAY
DEPT FOR DRL/ILCSR MARK MITTELHAUSER

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ELAB KTIP SOCI AR
SUBJECT: ARGENTINA: INPUT FOR LABOR SECRETARY SOLIS MEETING IN
GENEVA WITH ARGENTINE PRESIDENT FERNANDEZ DE KIRCHNER

REF: (A) 06/11/09 Gay-Gomez e-mail and telcon(B) BUENOS AIRES 0445

UNCLAS BUENOS AIRES 000686

DOL FOR ILAB CHANTENIA GAY
DEPT FOR DRL/ILCSR MARK MITTELHAUSER

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ELAB KTIP SOCI AR
SUBJECT: ARGENTINA: INPUT FOR LABOR SECRETARY SOLIS MEETING IN
GENEVA WITH ARGENTINE PRESIDENT FERNANDEZ DE KIRCHNER

REF: (A) 06/11/09 Gay-Gomez e-mail and telcon(B) BUENOS AIRES 0445


1. THIS CABLE IS SENSITIVE BUT UNCLASSIFIED. NOT FOR INTERNET
DISTRIBUTION.


2. (SBU) Summary and Introduction: Labor Secretary Solis' upcoming
June 15 meeting with Argentine President Cristina Fernandez de
Kirchner (CFK) represents an opportunity to assure the Argentine
government (GOA) that we value the bilateral relationship and that
we hope to intensify bilateral and regional cooperation to turn
around the global crisis and work together to build hemispheric
prosperity and security. Post offers the following overview (paras
3-7) and talking points (paras 8-13) to assist the Department of
Labor's preparations for the upcoming meeting which will take place
on the margins of the International Labor Organization (ILO) Summit
on the Global Jobs Crisis in Geneva, Switzerland. End Summary and
Introduction.

Political Overview
--------------


3. (SBU) President Cristina Fernandez de Kirchner (CFK) continues to
face an uphill battle with the Argentine public and international
financial markets in the face of a cooling Argentine economy,
continued strife with the popular farming sector, and increasing
public concerns over crime and security. Mid-term congressional
elections are June 28 and CFK's husband, former President Nestor
Kirchner is a candidate. The election is seen by many as a vote of
confidence in the Kirchner administration, and the Kirchners will
likely lose control over the lower house of Congress. CFK is avidly
seeking to associate herself with President Obama, who is highly
popular in Argentina, and the GOA has repeatedly requested a
bilateral meeting between the heads of state. She may be interested
in gauging U.S. support for her proposal to have the G-20 give a
seat to the International Labor Organization. Your meeting with CFK
represents an opportunity to assure the GOA that we are committed to
strengthening the bilateral relationship and that we hope to
intensify cooperation to turn around the global crisis and work
together to build hemispheric prosperity and security.

Labor Overview
--------------


4. (SBU) CFK is the latest member of the Justicialist (Peronist)

party to rule Argentina. Peronism is a labor-based movement that
has given labor unions more power and negotiating leverage in
Argentina than they enjoy in perhaps any other Latin American
country. This has entailed costs as well -- Argentina's inflexible
labor regulations hinder employment creation and productivity
growth. Despite some government efforts to reform labor
regulations, barriers to flexibility linger in the form of non-wage
costs. The non-salary cost of employing a worker is high, and
dismissing a redundant employee can be costly.


5. (SBU) Argentina's population is more than 40 million, with more
than 16.27 million in the labor force(76% of the labor force is
currently employed in the services sector; 23% in industry, and 1%
in agriculture). In late 2008, the government raised the monthly
national minimum wage to 1,240 pesos (US$335). Most workers in the
formal sector earned significantly more than the minimum wage. The
maximum workday is eight hours, and the maximum workweek is 48
hours. According to the Ministry of Labor, approximately 40 percent
of the urban workforce is employed in the informal sector. The
Ministry of Labor, which is responsible for enforcing legislation
related to working conditions, increased inspections to get
companies to register their informal workers.


6. (SBU) According to official GoA statistics, poverty levels
continued to fall in the second half of 2008, reaching 15.3% of the
urban Argentine population (with extreme poverty declining to 4.4%).
However, doubts about the validity of Argentina's official
statistics have led many analysts and social activists to question
official poverty figures. A number of private analysts calculate
poverty above 30%. They argue that the GoA's deliberate
underestimation of the level of poverty allows it to claim that it
has doubled social spending for the poor and reduced poverty, when
in fact per capita social spending has declined in real terms and
poverty appears to be rising after a few years of decline earlier in
the decade.


7. (SBU) The ILO reports that Argentina currently has more than
2,800 trade union organizations. An estimated 35 percent of the
workforce is organized in unions, and approximately 75 percent of
the formal sector workforce is covered by collective bargaining
agreements. The largest national union organization is the General
Confederation of Workers (CGT),which accounts for about 80% of

unionized workers. The CGT's secretary general, Hugo Moyano is
closely aligned with Cristina Fernandez de Kirchner, and is a Vice
President of the Peronist Party. The next largest union
organization is the Central of Argentine Workers (CTA),although it
does not have full legal standing on par with the CGT. Both
organizations are active participants in the ILO.

Suggested Talking Points
--------------


8. (SBU) Enhanced Cooperation: Argentina is playing an important
role on a number of issues that are important to the Obama
administration, including job creation, poverty alleviation, and
social inclusion. President Obama looks forward to deepening the
dialogue between our two governments and working in partnership in
these and other areas of common interest.


9. (SBU) Economic Crisis: How has the global economic crisis
affected Argentina? What measures have your government taken to
lessen the impact on Argentine workers and the most vulnerable?


10. (SBU) USG Labor Cooperation: We have been pleased to work with
the Ministry of Labor to share U.S. corporations' best practices on
corporate social responsibility and organize annual digital video
conferences on with the Federal Mediation and Conciliation Service
on labor conflict resolution and prevention. And we are looking
forward to working with your government trough the OAS
Inter-American Network for Labor Administration on the issue of
youth employment programs, targeting the most vulnerable youth.


11. (SBU) Forced/Child Labor: Forced and child labor is a problem
that all countries face, including the United States, and we must
work together to eradicate it. The Argentine Ministry of Labor's
initiative to develop a Corporate Network for the Eradication of
Child Labor as well as its joint program with the Ministry of
Education to provide scholarships to reintegrate children who have
dropped out of school to work are both excellent practices. What
can we do to assist these noteworthy efforts?


12. (SBU) IF RAISED: DOL Research Grant to Verite on Forced/Child
labor: I understand your concerns. The Department of Labor
conducts research and commissions studies all over the world to
inform and formulate international economic, trade and labor
policies in collaboration with other U.S. government agencies.
Argentina was selected for inclusion in this particular research
study because of recent news reports from the Argentine press about
forced labor, particularly in the garment industry. Research helps
the international community identify problem areas, develop
programs, and adopt policies to better address the issue.

Background: The Argentine government is extremely sensitive to any
public reporting that may be construed as criticism. In May, the
Argentine Embassy met with State Department officials to protest
USDOL's decision to award a $1.25 million grant to Verite, a
non-profit non-governmental organization, to research forced labor
in eight countries: Argentina, Bangladesh, Bolivia, China, the
Dominican Republic, Indonesia, Liberia, and the Philippines.
Department officials informed them that the report was for research
purposes only and not an accusation that forced labor is a problem
in Argentina.


13. (SBU) IF RAISED: Meeting with President Obama: I will pass on
your interest in meeting with President Obama to the White House.
It may take time, given the numerous challenges the President
currently faces. However, he has expressed a strong interest in
working closely with our partners in the hemisphere, and we very
much value our partnership with Argentina.

KELLY