CURACAO'S MAY 15 REFERENDUM CAMPAIGN TIGHTENS

UNCLAS SECTION 01 OF 02 CURACAO 000038

SIPDIS

DEPT FOR FOR L, CA, M AND WHA\CAR

E.O. 12958: N/A
TAGS: NA AA NL PGOV ECON EFIN MARR SNAR
SUBJECT: CURACAO'S MAY 15 REFERENDUM CAMPAIGN TIGHTENS

REF: CURACAO 000012; CURACAO 000032

THE UPCOMING VOTE:


1. The ruling coalition remains confident of winning Curacao's
May 15 referendum on agreements with the Dutch relating to
dissolution of the Netherlands Antilles (reftels). While polling
here can be unreliable, its May 2 survey of 994 voters showed
"YES" maintaining a lead of around 20 percent. More recent
party polling indicates a possible tightening of the race, but
still gives "YES" about a 13 percent lead. Opposition parties
have not released recent poll data but have ramped up their
negative media campaign, which plays on populist emotions. The
"NO" campaign also received a boost from the support of several
key labor unions.


2. Approximately one quarter of those polled have either
refused to give their position or remain undecided. In general,
wealthier segments of society support "YES", while "NO" has
relied on unemployed and union workers for much of its support.
Additionally, there exist some racial overtones, with the vast
majority of "white Dutch" voters supporting "YES" and the
opposition stirring up racial resentments in some of its ad
campaigns. Government officials from various parties have said
that the vote has become "nasty" and "personal," with some
reporting having received anonymous telephone threats. The
campaigning overall has been, as usual here, peaceful and
democratic. It has tended; however, to focus on political
issues unrelated to the complex referendum question itself.

PRIVATE SECTOR AND OTHER CONCERNS:


3. Many in the business sector have publicly predicted a
doomsday scenario and financial meltdown for Curacao if the "NO"
vote wins. The Curacao Hospitality and Tourism Association
(CHATA) has called on its members and those working in that
sector to vote "YES". CHATA spokespersons said debt relief,
which would result from a "YES" vote, is a "life buoy" in the
current world economic crisis and that a "NO" vote would cause
Curacao's tourism sector to fall behind the rest of the
Caribbean. The Store Owners Association (SKO) said that
customers have clearly reduced their spending due to concerns
that "NO" could win. Radio Netherlands Worldwide (RNWO)
commented, and local investment firms have confirmed to us, that
many investments in Curacao have been put on hold awaiting the
referendum results. Both the Curacao Chamber of Commerce and the
Curacao International Financial Services Association (CIFA) came
out in support of "YES". CIFA said that approximately 16 percent
of the island's professional labor force works in financial
services. Business leaders have been generous in contributing
to the "YES" campaign, giving it a spending advantage over "NO",
which some charge is receiving funding from Venezuela.


4. Councilman Chris Johnson of the Antilles sister island of
Saba also expressed concern over the outcome of the referendum.
He noted that a "NO" vote might result in the current Antilles
Government coalition stepping down, which would bring about a
new round of federal elections. This could have serious
consequences for the entire Netherlands Antilles, including
Saba, which hopes to proceed with dissolution plans.

UNIONS SUPPORT "NO":


5. Although some unions have remained neutral, the majority
has come out in support of "NO". The left-leaning teachers'
union (SITEK) advised its members to vote "NO." Members of the
transportation union also support "NO." Drivers had backed the
current coalition government in the last election, but are still
angry over government handling of a strike last year. The
Customs, Coast Guard, and Prison employees union (STRAF) is
another prominent "NO" supporter.

CONFIDENCE IN PROCESS - EVEN WITH SMARTMATIC


6. The director of the Civil Records Bureau, which organizes
and supervises voting, said he was pleased with voting
preparations. Both ruling coalition and opposition parties have
expressed confidence in the voting process. The United Nations
has sent a single observer for the referendum, also considered a
sign of confidence.


7. Curacao will again use voting machines purchased in 2007
from Venezuelan-American Company Smartmatic, which came under
scrutiny for its role in Venezuelan elections. Machine
printouts will be used to count the votes manually. Smartmatic
representatives are in Curacao to program the machines, under

CURACAO 00000038 002 OF 002


supervision of Curacao Civil Records personnel. Some observers
have privately expressed concern over allegations that
Smartmatic machines are vulnerable to manipulation (allegations
exacerbated by persistent rumors that Venezuela has helped fund
the "NO" campaign),but voting officials have given assurances
that strong security measures are in place.


PEACEFUL CLOSE TO CAMPAIGNS:


8. Curacao has a long tradition of free, transparent, and fair
democratic voting. Few expect any significant problems related
to this Friday's referendum. Approximately 1500 people attended
the closeout "YES" rally in downtown Willemstad May 13.
Businessmen and financial sector leaders were prominent among
the crowd. A closeout "NO" rally planned to be held
simultaneously just across the bay from the "YES" rally was
moved to the more distant party headquarters. The atmosphere at
both political rallies was festive and peaceful.


9. Although the referendum has received significant media
coverage and rhetoric from party stalwarts has recently been
heating up, public interest has been more muted. In past
parliament and Island Council elections, up to one third of
vehicles proudly displayed party colors, while only three or
four percent are now flying "YES" or "NO" flags. Public
demonstrations have also attracted markedly fewer participants.
There has been some concern that a low voter turnout could make
the results even more unpredictable. PM Emily De Jongh-Elhage
and the well-respected Catholic Bishop have taken to the
airwaves urging Curacao citizens to exercise their right to
vote. The PM focused on the importance of the referendum for the
future of Curacao and advised people to vote "YES". In any case,
Curacao is expected again to show that it can deal with its
political issues in a peaceful and democratic manner.
DUNN