JAMAICA: CODEL ENGEL DISCUSSES ECONOMY, ENERGY, AND

UNCLAS KINGSTON 000184

SIPDIS

SENSITIVE

WHA/CAR FOR CODEL ENGEL

E.O. 12958: N/A
TAGS: OVIP PREL PGOV ETRD ECON ENRG ASEC JM XL
SUBJECT: JAMAICA: CODEL ENGEL DISCUSSES ECONOMY, ENERGY, AND
- LAW ENFORCEMENT COOPERATION WITH GOJ OFFICIALS

Summary
--------------


1. (U) From February 20-22, a CODEL led by WHA sub-committee
Chair Eliot Engel was in Kingston, Jamaica, meeting with
government officials and civil society representatives to
discuss energy, environmental, and law enforcement cooperation
issues. In addition to Chair Engel, the CODEL included
Representatives Virginia Foxx, Jean Schmidt, Mark Souder,
Ruben Hinojosa, and John Salazar. Congressional staff members
Jason Steinbaum, Julie Schoenthaler, Eric Jacobstein, Janice
McKinney, and Congressional Research Service staff Mark
Sullivan accompanied the CODEL. Julie Bulgrin from the H
Bureau, military escorts Colonel Joey Booher, Colonel Thomas
Lawhead, and Dr. Ceasar Junker were also a part of the
delegation.


2. (SBU) At a February 21 meeting with the Jamaican Prime
Minister, Foreign Minister, and Energy Minister, the
Government of Jamaica (GOJ) discussed the effects of the
global economic crisis, the need for increased security
cooperation, a hope for closer trade and investment ties, and
concerns over a possible drop in the ethanol tariff that would
render Jamaican ethanol less competitive in that sector.
Members of the CODEL acknowledged the need for enhanced
security cooperation that would benefit both nations. The
CODEL later toured an ethanol production facility and visited
a Coast Guard base to discuss law enforcement cooperation.
They also visited three USAID projects that focus on
livelihoods and environmental sustainability. In addition,
the CODEL hosted a reception on February 20 attended by NGO
representatives, business operators, government officials, and
opposition parliamentarians.

End Summary.

Prime Minister and Cabinet Officials
Discuss Jamaica?s Economic Concerns
--------------


3. (SBU) A CODEL of six Congress members led by Western
Hemisphere Affairs (WHA) sub-committee Chair Eliot Engel
visited Kingston from February 20-22. At a February 21
breakfast hosted by Prime Minister Bruce Golding at his
official residence, Vale Royal, Chairman Engel was accompanied
by the full delegation, along with Charge James Heg. In
addition to Golding, the Government of Jamaica (GOJ) attendees
included Foreign Minister Kenneth Baugh, Energy Minister Clive
Mullins, Junior Minister of the Ministry of Foreign Affairs
and Foreign Trade (MFAFT) Ronald Robinson, Cabinet Secretary
Ambassador Douglas Saunders, MFAFT Permanent Secretary
Ambassador Gail Mathurin, Permanent Secretary of the Office of
the Prime Minister (OPM) Pat Sinclair MacCullough, OPM Chief
Technical Director Oneka Miller, and MFAFT Undersecretary for
bilateral and regional affairs Ambassador Paul Robothom.


4. (SBU) GOJ officials raised a number of issues, opening with
the economy. Golding stated that the global financial crisis
had made it difficult for Jamaica to gain access to capital
markets. The GOJ obtained USD 1 billion through multilateral
banks, which prevented a widespread economic collapse.
However, severe economic strains remain. Jamaica has seen a
ten percent drop in total remittances, 65 percent of which
originate in the U.S. The national deficit and the large debt
burden are impairing Jamaica?s progress, Golding said. The
GOJ will have to cut expenditures, perhaps including public
sector jobs, and there are no resources to mount a stimulus
package.


5. (SBU) In the international economic system, there needs to
be some accommodation for developing countries, which provide
markets for other economies, Golding stated. He added that
Jamaica has reduced poverty from 27 percent to 13 percent, but
many of the gains may roll back with the current economic
difficulties. Countries like Jamaica must wean themselves off
aid, but foreign investment is important. To that end, the
GOJ would be interested in pursuing a free trade agreement
with the U.S. through CARICOM, particularly if special and
differential treatment for CARICOM member states might be
possible. Jamaica also needs to access its untapped economic
potential, per Golding. Currently, 3.4 million tourists visit
Jamaica annually, but it could support up to 10 million
tourists per year. Eco-tourism and heritage tourism might
prove lucrative. Jamaica also is negotiating with Spain to
market medical tourism. The Spanish are primarily investors.
While the number of Spanish tourists has increased from 2000
visitors to 17,000 annually, the bulk of visitors to Jamaica
still come from the U.S.



6. (SBU) Golding underscored the importance of economic
advancement, saying ?we don?t want to see this region slip
into political instability. When people are poor, rationality
goes through the window.? Congressman Hinojosa stated that it
is crucial to invest in education and information technology.
There should be a shift away from agriculture, with a focus on
jobs, food, health, housing, and education. Action now
prevents the need for reaction in the future, staving off the
danger of social unrest, Hinojosa said.

Dialogue on the Need for Security Cooperation
--------------


7. (SBU) Prime Minister Golding stated that Jamaica is the
U.S.?s ?third border,? so cooperation on security measures is
essential. Caribbean Heads of Government met with then-
Secretary Rice at the UN General Assembly in September 2007,
but there should be a mechanism to regularize meetings.
Golding believes there needs to be follow-up on security
cooperation, immigration, and development, and Chairman Engel
agreed. Golding also said that Jamaica needs more assistance
to combat narco-trafficking. The Merida Initiative, if
effective, could channel drug traffickers looking for an
alternate route to the Caribbean, he worried.


8. (SBU) Jamaica needs assistance in controlling the influx of
small arms, Golding noted. He said an estimated 95 percent of
illegal weapons are imported from the U.S. Chairman Engel
explained that Mexico suffers from a similar problem, which he
had discussed during the CODEL?s recent visit there. Engel
stated that there is no conflict with the U.S. Constitution?s
second amendment in limiting the illicit international flow of
weapons, and it remains an area for enhanced bilateral
cooperation. Golding said he appreciated joint efforts to
date on stopping narco-traffickers, extradition, information-
sharing, and on confiscating and reinvesting the proceeds of
crime. Golding noted that the U.S. is willing to have a
customs presence in Jamaica, but initially the GOJ said they
could not be armed, which stalled the plans. Golding is
holding discussions with his Minister of National Security to
allow armed U.S. customs agents to serve in Jamaica.


9. (SBU) The crime rate in Jamaica is unacceptably high,
Golding said. There has been some progress, though, and ganja
cultivation is down and cocaine trafficking has decreased
significantly. In 2007, it dropped to 20 percent of the
initial rate. Nevertheless, Jamaica has 300 miles of
coastline, and would like U.S. assistance in monitoring it
through satellite technology. Golding also raised the issue
of deportees, saying that many may not have ties to Jamaica
when they return, and may commit crimes here. In addition, if
courts in the U.S. opt for deportation in lieu of prison
sentencing, the criminal is immediately released and does not
serve time at all, the GOJ has no recourse when the deportee
arrives. Golding said he accepts that after due process,
people may be deported, but the system should be improved.
Rep. Engel asked if the USG provides all information (?entire
rap sheet?) on criminal deportees. Golding did not know the
answer. (Comment: Post?s DHS/ICE Attach confirms that
complete ?rap sheets? on criminal deportees currently are not
provided to receiving countries because the information is
maintained in proprietary FBI databases. End Comment.)
Golding also emphasized the need to back up crime fighting
with social programs. If people feel abandoned by a society,
they have no commitment to it. A New York City Police
Commissioner who visited Jamaica attributed the success in his
city to a combination of police and social measures, Golding
said.


10. (SBU) Golding explained that Jamaica recently had a
strategic review of the police with experts from the U.S., UK,
Canada, and South Africa weighing in, and the GOJ will
implement 119 out of the 124 recommendations. The year-to-
date murder rate is down 17 percent, which is a step in the
right direction. (Note: however the aggregate homicide rate
remains an unacceptable 60/100,000). Golding also explained
his personal commitment to anti-corruption efforts. The
current laws are weak, and corruption cases are prosecuted
with all others, getting lost in the shuffle of civil cases.
There is now a bill in parliament to create a special
prosecutor for corruption cases. The office would fall under
the Department of Public Prosecutions (DPP) but would maintain
a degree of autonomy.

Discussions on Energy Issues
--------------


11. (SBU) Energy Minister Mullings told the CODEL that Jamaica
has had a wind farm since 2005, and may explore geo-thermal

energy as well. The November 2008 trilateral agreement with
the U.S. and Brazil can also provide a tremendous opportunity
for the U.S. to export vehicles, Mullings believes. There is
a regional move toward ethanol, with a 10 percent blend in use
now. If the percentage of ethanol in fuel rises,
manufacturers of flex-fuel vehicles stand to benefit. Foreign
Minister Baugh noted the need for continued dialogue, and felt
that small countries must take advantage of economies of scale
through strategic partnerships.


12. (SBU) Prime Minister Golding noted that the Caribbean
Basin Initiative (CBI) limits Jamaican exports to 7 billion
gallons per year, and there may be a need for an increase on
that ceiling. He expressed hope that the favorable trade
provisions are not in danger of expiring when the CBI sunsets
in 2010. In addition, he was concerned that a drop in the
U.S. tariff would endanger Jamaica?s participation in ethanol
exports.


13. (SBU) The GOJ wants to restructure its sugar industry to
accommodate feed to ethanol programs, Golding said. Jamaica
currently has duty/quota-free access to the U.S. for sugar
exports, but no price guarantee. For now, Jamaica imports
Brazilian feed and uses it to process ethanol. If Jamaica can
produce its own feed for further processing, it can expand
production. In addition, the GOJ is privatizing its sugar
industry, which had been 83 percent government-owned. Golding
has spoken to the President of Brazil about favorable
consideration on sugar-based ethanol.


14. (SBU) Congressman Salazar explained that while prices
remain low, it is difficult to move on the ethanol issue. In
his own district, unemployment has risen from 4 percent to
over 10 percent in the last year. Considering that, the Buy
America provisions are important, especially for industrially
declined areas that suffer under free trade arrangements.
Congressman Hinojosa noted that in his district, cotton,
sorghum, and cane are key crops. There is a powerful
agricultural lobby in the U.S., and all nations consider it
important to safeguard the agricultural sector.

Fruitful Discussions with NGO,
Opposition, and
Government Representatives
--------------


15. (U) The CODEL hosted a reception on February 20 to which
the Embassy invited NGO representatives, members of the
business community, opposition politicians, and government
officials. Organizations such as the Jamaican Forum for
Lesbians, All-sexuals, and Gays (J-FLAG),People?s Action for
Community Transformation (PACT),and Woman, Inc., all sent
representatives to the event. Members of the CODEL were able
to elicit views on a range of issues, including continued
harassment and attacks on homosexuals, efforts to combat
trafficking in persons, and problems of domestic violence.
They also heard a variety of opinions on the current economic
climate and its effect on entrepreneurs, as well as criticism
of the ruling Jamaica Labour Party (JLP) from the opposition
People?s National Party (PNP).

Visit to Jamaica Defence Force-Coast Guard
--------------


16. (SBU) The delegation visited HMS Cagway, headquarters for
the Jamaica Defence Force Coast Guard (JDF?CG). The JDF-CG
was very appreciative for security assistance in the form of
commodities and training from both the Narcotics Affairs
Section (NAS) and the Military Liaison Office (MLO). The JDF-
CG provided a brief overview of its mission and challenges,
and then the Executive Officer led the delegation on a brief
tour of the facility. At the end of the briefing, the
delegation learned about JDF-CG cooperation with JIATF South
and saw the JIATF ?chatroom? running on a computer. During
the tour, the delegation was shown interceptor boats,
trailers, and towing vehicles recently provided by MLO under
?Enduring Friendship.? The delegation also was shown three
vessels, past donations from NAS, that are currently in dry-
dock awaiting refit. NAS does not have the funding to assist
the JDF-CG refit these vessels (USD 300,000 per) and the JDF-
CG is in discussions with NAS on how to properly dispose of
the vessels and use the funds to support the program. The
delegation also saw a variety of other security items provided
by the USG to the JDF-CG.

Jamaica Broilers Ethanol (JBE)
--------------


17. (SBU) The delegation visited Jamaica Broilers Ethanol

(JBE) on February 21. Jamaica Broilers was represented by
Chairman Robert Levy, President and CEO Chris Levy, Head of
the Ethanol Plant Stephen Levy, and CFO Ian Parsard. The JBE
officials expressed concern about any move to reduce the
tariff on Brazilian ethanol. When asked at what tariff level
the sector in Jamaica would be able to survive, Parsard said
it depended on a number of variables, but any floor below 54
cents could prove detrimental to current and future projects.
In a private conversation with congressional staff, one JBE
team member said that his company could live with a tariff
level reduced to $.45/gallon, the level in one U.S.
legislative proposal. He also told congressional staff that
it would take at least 5 years for JBE to build in enough
efficiencies to survive elimination of the tariff. The JBE
team reiterated the importance of the CBI benefits and
explained that this is what influenced their decision to
double production capacity at the plant. Chairman Engel
explained that he was a new convert to renewables, given their
importance to energy independence. He said renewables were
also part of the answer to breaking the dependency on oil.
This was welcome news to the JBE group.

HEG