Uruguay: President-Elect Mujica's Debut at Mercosur Summit

UNCLAS MONTEVIDEO 000718

SENSITIVE
SIPDIS
FOR WHA/BSC MARY DASCHBACH

E.O. 12958: N/A
TAGS: PREL PGOV UY
SUBJECT: Uruguay: President-Elect Mujica's Debut at Mercosur Summit

REF: MONTEVIDEO 489; MONTEVIDEO 468

Summary

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1. (U) The December 8-9 38th summit meeting of MERCOSUR, provided
an appropriate platform for Jose Mujica's regional debut as
president elect. Mujica was warmly received by the delegates and,
thanks in particular to high profile meetings with Christina
Kirchner and Hugo Chavez, managed to attract the majority of the
summit's domestic press coverage. Mujica's expressed intent to
further develop regional relations seems to have taken a purposeful
first step. End summary.



Presenting Mujica

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2. (U) Early on in his speech marking the official handover of the
six-month MERCOSUR presidency from Uruguay to Argentina, Uruguayan
President Tabare Vazquez took the opportunity to officially
introduce President-Elect Mujica to the assembled heads of state.
In response, Brazilian president Lula da Silva led a series of
congratulatory statements from the delegates that described Mujica
variously as "friend," "comrade," "beloved," and "admired." In
contrast to his electoral rival, ex-president Luis Alberto Lacalle,
who had planned to lead a scaling back of MERCOSUR political
initiatives, Mujica has publically supported increased integration
(albeit with the qualification that Uruguay should keep "one paw in
and one paw out"),and signaled his intention to deepen Uruguay's
links with its neighbors throughout his campaign. Mujica placed
particular emphasis on Brazil, enjoying a high profile meeting with
President Lula on August 4. The two men seemed delighted to be
reunited at the MERCOSUR meeting, and were able to talk privately
for several minutes.



Mujica and Kirchner- a new beginning?

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3. (U) Mujica drew attention even before the summit began by
meeting privately with Argentina's President Cristina Kirchner the
night she and her delegation arrived (December 7). Although
historically close, recent relations between Uruguay and Argentina
have been strained by the protracted Botnia paper mill dispute and
related bridge blockades and several other issues (Ref A).
Bilateral tensions have worsened gradually under Vazquez, but some
commentators have been hopeful that Mujica's close relationship to
the Kirchners (he has been their personal guest) could facilitate a
rapid thawing. The summit reinforced the idea that Mujica's
electoral victory will improve relations. The half-hour hotel
meeting was reportedly "cordial" and "frank" and although according
to media reports the topic of Botnia went untouched. Kirchner
nonetheless emerged remarking that "a new government implies new
beginnings." For his part, Mujica, who as early as the November 29
second round elections had agreed with representatives of Kirchner
to establish a binational commission aimed at reestablishing good
relations between the two countries, has said he wishes to isolate
the paper mill issue, leaving its resolution to the courts.
Kirchner left Uruguay having turned down an invitation to dine with
Mujica and Chavez, but with a promise to return for Mujica's March
1 inauguration.



Mujica and Chavez

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4. (U) On December 8, press focus shifted to Venezuelan president
Hugo Chavez's visit to a glass factory in the industrial park
located in the working class "Cerro" district. Accompanied by

Mujica, Chavez inspected a factory that in 2005 had been saved from
bankruptcy by a USD 4 million cash injection from his government.




5. (SBU) Mujica and Chavez have met on several occasions over the
years and are widely perceived to have clicked, a perception that
Mujica, striving to present himself as a moderate, tried hard to
downplay during the electoral campaign (Ref B). While President
Vazquez is generally considered to have maintained a careful middle
line with the Venezuelan administration, many analysts anticipate
that Mujica's government will foster closer ties with Chaveza
prediction Chavez himself seemed keen to realize.




6. (SBU) Stronger bilateral relations were the major theme in
wide-raging speech Chavez gave to approximately 100 workers at the
glass factory. Holding forth for a relatively restrained 45
minutes, Chavez managed to include (amongst other things): a eulogy
to Mujica (which included the comment that Chavez would have been
honored to have fought alongside Mujica in the "glorious" guerilla
war in the 70's); congratulations to Evo Morales for his electoral
victory in Bolivia; a trademark broadside against "Yankee
imperialism"; a potted history of petroleum in Venezuela; a
condemnation of the recent elections in Honduras; and even a
passable a cappella rendition of a song in praise of Simon Bolivar.
Chavez made headlines by announcing he will provide as much oil as
Uruguay needs for 100 years, a reference to his intention to build
on the Caracas Energy Agreement, signed by President Vazquez in
2005, that allows Uruguay to pay back 75 percent of the cost of the
oil supplied by Venezuela over 15 years with the balance being made
up in Uruguayan goods and products. Under Chavez's new proposal,
Uruguay would be able to use its goods and services to substitute
up 50 percent of the cost, an arrangement that Chavez declared
would allow Venezuela to meet Uruguay's oil needs "for the next 100
years." The promise of Uruguay's energy needs being met seemed to
have a soothing effect on Mujica, who quietly dozed off behind him.




Comment

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7. (SBU) We expect Mujica will focus his early foreign policy
energies close to home, and his first such effort seems to have
been well received. While international relations was perceived as
a weakness in his presidential bid, Mujica held his own. With
Chavez and Lula, he is in his element talking about issues, such as
regional integration and social justice, which are close to his
heart. End Comment.
MATTHEWMAN