UNCLAS SECTION 01 OF 03 MEXICO 003278

SENSITIVE

SIPDIS

D FOR PIPER CAMPBELL, EDWARD MEIER; WHA FOR ROBERTA JACOBSON;
WHA/MEX FOR ALEX LEE, COLLEEN HOEY, MARY STICKLES

E.O. 12958: N/A
TAGS: PGOV PREL PHUM KCRM SNAR ECON MX
SUBJECT: SECRETARY LEW: YOUR VISIT TO MEXICO


1. (SBU) Jack: We are extremely grateful for your visit and
confident you will leave with a solid appreciation of the challenges
Mexico faces as it confronts the drug cartels, deals with the
effects of the global recession, and struggles to consolidate
democracy and the rule of law. Most importantly, you will see how
strong our partnership has grown as a result of helping the Calderon
administration shape its strategic approach to these challenges in a
spirit of mutual responsibility. Building on the Secretary's
meeting with Foreign Secretary Espinosa this past September, we have
made significant progress in fleshing out the framework for our
cooperation with Mexico in the context of the Merida Initiative. As
you prepare for Hill briefings, your meetings here with President
Calderon and Foreign Secretary Espinosa, with experts on economic
competitiveness, with senior law enforcement and military policy
officials, with civil society leaders, and with our country team,
will provide you with insights into the progress USG-Mexican
cooperation has produced to date and the potential it holds for the
future. We welcome the opportunity to engage on the Quadrennial
Diplomacy and Development Review (QDDR) and to review some of the
management challenges Mission Mexico faces in pursuing our
priorities.


The Way Ahead on Merida


2. (SBU) Our engagement with the Mexicans to cooperate beyond the
current Merida initiative has produced excellent results. We now
have a four pillar strategic framework that has been blessed in
principle by the two secretaries and operationalized through the A/S
level by both governments. NSC Senior Director Restrepo and INL
PDAS McGlynn joined me last week in leading a second high-level
inter-agency discussion with the Mexicans focused on
institutionalizing the rule of law (pillar 2) and creating strong
and resilient communities (pillar 4). As with our earlier
discussion on disrupting drug trafficking organizations (pillar 1)
and building a modern border (pillar 3), the Mexic

ans are engaging
with us in a serious exercise to deepen and extend our cooperation.
The challenges are quite clear: a top heavy bureaucracy that resists
interagency cooperation, a traditional military that looks
suspiciously at "interference" by civilian authorities, and high
levels of violence and corruption, particularly along our common
border. The Mexicans have agreed to conduct a bi-lateral assessment
mission in Tijuana and Ciudad Juarez at the end of November, which
should help us focus on priority areas for beyond Merida: better
civilian-military links on operations along the border and better
interagency cooperation that will allow effective operationalization
of intelligence.


3. (SBU) Mexico continues to face high levels of violence in Ciudad
Juarez and other parts of the country as its military and law
enforcement institutions sustain their pressure on the drug cartels.
Mexican officials appreciate the contribution unprecedented
cooperation with the U.S. has made to its progress in combating
organized crime. At the same time, our Mexican interlocutors have
conveyed frustration with the perception that delivery on our
assistance programs is lagging. It bears noting, however, that a
number of our key programs - such as our contribution to the Police
Secretariat's facility in San Luis Potosi that aims to train up to
9,000 federal police over the next year - are well underway.
Meanwhile, we expect to deliver on a major ticket item - four Bell
helicopters - before the end of the year, and an additional three
Black Hawks in mid-2010. As the pace of delivery on assistance
picks up, we intend to shine greater light on the Mexico's own
efforts, as the GOM invests seven times more than the U.S. Merida
budget.


4. (SBU) Going forward, we will transition away from delivery of
expensive hardware such as helicopters, planes, and other costly
equipment to sponsoring extensive training and technical assistance
programs to foster stronger law enforcement and judicial
institutions. Mexico adopted major justice reform in 2008. In
essence, Mexico seeks to transition from an antiquated and corrupt
inquisitorial justice system to a modern, transparent, accusatorial
framework, recognizing the presumption of innocence as a
constitutional right, and oral trials as the primary mechanism for
administering justice. Implementation over the next seven years
poses monumental challenges. We look to provide training to key
players in the Mexican judicial system at both the federal and state
level. With regards to Mexican law enforcement institutions, we
have focused to date on working with agencies at the federal level
given our more advanced relationship with and trust in those
entities. However, we are seriously working to develop our efforts
at both the state and local level where Mexico's law enforcement
organizations face resource constraints and are fraught with
corruption. Tijuana has enjoyed some recent successes by creatively
structuring its state and local law enforcement institutions. We
intend to apply some of the lessons learned in Tijuana to help the
GOM meet the challenges it faces in Ciudad Juarez. For President

MEXICO 00003278 002 OF 003


Calderon there is no higher short-term priority that reducing the
grotesque levels of homicides, kidnappings, and drug trafficking in
this critical border city.


5. (SBU) The GOM has deployed over 45,000 soldiers and 5,000
federal police around the country to face down the drug cartels.
These entities, together with the local police, can only achieve so
much absent a capacity to collect and operationalize intelligence on
the cartels. Presently, Mexico's efforts are severely handicapped
by the lack of professional intelligence expertise and a lack of
trust both within and among institutions that is essential to
facilitate timely sharing of actionable intelligence. By working
with the federal, state, and local authorities in Juarez to create a
genuine task force model, we seek to give cops, soldiers, and
prosecutors that missing but essential informational capacity.
Doing so would greatly enhance GOM abilities to disrupt DTOs in the
short-term and provide a foundation for the improved interagency
cooperation needed throughout the justice sector in the long-term.


6. (SBU) Human rights remain a crucial element of our dialogue with
the Mexican government. Presently, we draw down U.S. DOD funded
programs to sponsor seminars, conferences and exchanges that promote
greater human rights respect. Recently, the GOM signed an MOU with
the UN's Human Rights Office in Mexico that opens the door to
working more closely with the Mexican military (SEDENA) to promote
human rights respect. Both the Mexican Foreign Ministry and SEDENA
have reluctantly conveyed a willingness to meet with us formally to
exchange information on human rights issues. However, SEDENA is
still wary of speaking to specifics on cases the human rights
community and Congressional staffers have raised. Meanwhile, we
have opened a robust dialogue with the Mexican human rights
community in an effort to address its concerns, particularly in
connection with military judicial transparency, protection of human
rights defenders, improving mechanisms to prosecute abuses, and
setting benchmarks for human rights progress.


7. (SBU) You should use your lunch with senior law enforcement and
policy officials to stress our commitment to continued cooperation
in the context of the Merida Initiative and beyond. We expect
SEDENA and SEMAR will each send at least one representative to the
lunch. It would be helpful to underscore the centrality of human
rights and your ongoing dialogue with Congress, raising as well the
need for all GOM agencies (not just SEDENA) to prosecute the cartels
in accordance with the rule of law. You will want to reinforce our
understanding that beyond Merida cooperation will transition to
focus primarily on strengthening institutions, particularly at the
state level, and building the Mexican capacity to collect and
operationalize intelligence.


Calderon's Embrace of Economic Competitiveness


8. (U) Mexico is still reeling from the impact of the global
economic crisis and the resulting downturn in the United States, its
largest trading partner. According to the Finance Secretariat,
Mexico's GDP is expected to contract by 6.8 percent this year. The
Calderon Administration projects optimistically that the Mexican
economy will bounce back next year and grow 3 percent in 2010. To
do so, Mexico will depend greatly on the United States' recovery,
the NAFTA, and export-led growth. However, President Calderon's
chief economic goal looks beyond a recovery; he wants to make
inroads into eradicating poverty in Mexico, currently at 47 percent
but on the rise over the last year. Therefore, President Calderon
has called for making Mexico and North America more competitive. In
Mexico, he has urged for congressional and private sector
cooperation in increasing competition and reforming the labor,
finance, energy, and telecommunications sectors. As for North
America, his Administration is already working with its NAFTA
partners to make standards and regulations more compatible. In
addition, Calderon has called for the United States and Mexico to
develop an aggressive infrastructure plan along the shared border as
well as increase measures to facilitate cross-border trade.


9. (U) At last week's APEC Summit in Singapore, Calderon spoke
frankly about Mexican frustrations with a U.S. trade relationship
that has become entrapped in trade disputes such as trucking, with
little vision on advancing the joint competitiveness of our two
economies. Protectionism, he pointed out, is the biggest obstacle
to recovery and warned that the United States and others are being
tempted to raise tariff and non-tariff barriers to protect their
domestic producers and labor markets. Both sides are attempting to
resolve these disputes and avoid damaging our overall strong
bilateral partnership. At a breakfast meeting with some of Mexico's
leading economic policy makers, economists, and businessmen, you
will discuss prospects for Mexico's enhanced competitiveness in the
North American and global markets, while examining how Mexico's
security challenges impact these efforts.


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Tapping Your Leadership on Management Issues


10. (SBU) We appreciate your leadership on the Quadrennial
Diplomacy and Development Review (QDDR) and look forward to seeing
how Mission Mexico can contribute to the Secretary's initiative. We
believe Foreign Secretary Espinosa would welcome the opportunity to
learn more about what the QDDR involves. The Mexican Government has
disparate and weak strategic planning processes. Resources are more
often tied to personal relationships than to well- conceived
objectives. Spending is frequently reactive and vestigial patronage
structures impede policy makers looking beyond a 3-4 year horizon.
However, the Mexican Foreign Ministry has come under pressure to
control budget increases, particularly when it comes to
contributions to international organizations.


11. (U) We would also like to take advantage of your visit to
discuss some of our own managerial challenges. Mission Mexico
comprises Embassy Mexico City, nine constituent posts and thirteen
Consular Agencies. Mexico has 2553 staff, of which State has 1608.
Thirty-one agencies are represented at Post. Consular staffing
continues to grow, with an additional 28 officer positions projected
by 2012. MRV fee collections remain a critical source of funding
for consular positions and other Mission activities, although the
number of visa applications fell in Mexico last year. The Merida
Initiative continues to add USDH and LES positions in FY10.
Right-sized staffing will rise to 2846 by 2014. Management
staffing, however, is strained because it has not grown at the same
rate as the State Program and other agency personnel it supports.
WHA's Bureau Strategic Plan included two management positions in an
effort to address this shortfall, but additional LES positions are
needed as well.


12. (SBU) Meanwhile, violence in northern Mexico has reached
previously unthinkable levels, disrupting employees' everyday lives
and affecting post morale. In October 2009, I met with Under
Secretary for Management Pat Kennedy to request danger pay for
employees at all posts in Mexico, except Consulate Merida. Embassy
Mexico has also asked OBO for permission to purchase land for a new
embassy compound (NEC). Mexico City's NEC project, once scheduled
for 2009, has been pushed back to 2017, but the embassy hopes to
take advantage of low real estate prices and current market
availability. A NEC would eliminate security vulnerabilities
inherent to the current location and consolidate staff in one safe,
secure compound.




13. (SBU) You are visiting Mexico at a critical juncture in its
history. President Calderon has clearly decided that his legacy
will rest on confronting organized crime and promoting greater
security for his citizens. We have a clear national interest to
contribute to that vision. Calderon, in defiance of traditional
Mexican foreign policy, has bet on a genuine partnership with the
U.S. in pursuit of these objectives. We enjoy an historical
opportunity to help Mexico realize its full potential as a stable,
prosperous, democratic neighbor. In the process, we can tackle our
shared challenges both in terms of combating criminal threats and
enhancing our competitiveness as a region. Your visit will
reinforce the importance we attach to cooperation with Mexico and
should assist you in making the case to Congress for the appropriate
resources to continue this work.

PASCUAL