(U) Secretary Clinton's April 17, 2009 Meeting

C O N F I D E N T I A L PARTO 042301

C O R R E C T E D COPY

SIPDIS
LA PAZ FOR A/DCM LAMBERT

E.O. 12958: DECL: 04/16/2019
TAGS: OVIP CLINTON HILLARY PREL SNAR ETRD EAID
CVIS, CU, VE, HA, DR
SUBJECT: (U) Secretary Clinton's April 17, 2009 Meeting
with Dominican President Leonel Fernandez


1. (U) Classified by: Paul Wohlers, Deputy Executive
Secretary, S/ES, Department of State. Reason 1.4 (d)


2. (U) April 17, 2009; 9:45 a.m.; Santo Domingo,
Dominican Republic.


3. (U) Participants:

U.S.
The Secretary
Charge d'Affaires Roland Bullen
A/S Thomas Shannon, WHA
Cheryl Mills, Chief of Staff to the Secretary
Anne-Marie Slaughter, Director of Policy Planning Staff
Lt. General Paul Selva, Assistant to the Chairman of the
Joint Chiefs of Staff
Ellen Dunlap (Embassy Notetaker)

DOMINICAN REPUBLIC
President Leonel Fernandez
Carlos Morales Troncoso, Secretary for Foreign Affairs
Temistocles Montas, Secretary for Economy, Development
and Planning
Franklin Almeyda, Secretary for Interior and Police


4. (C) Summary. In a cordial meeting, the Secretary and
President Fernandez emphasized the importance of a
bilateral relationship based on close economic, security,
and cultural ties. Fernandez expressed concern over
increased drug trafficking and requested additional U.S.
assistance to provide training and technology. The
Secretary said counter-narcotics efforts were a priority
for the U.S. government and noted the importance of the
upcoming security dialogue with the Caribbean. The
Secretary expressed an interest in seeing Fernandez play
an increased role in the region, including by convincing
Venezuela to cooperate on anti-narcotics efforts. She
also said the United States wanted to work with the
Dominican Republic (DR) to create investment
opportunities in Haiti.


5. (C) Summary, cont. Fernandez indicated his desire to
reopen consulates in Baltimore, Philadelphia, and
Jacksonville, as well as new missions in Houston and New
Jersey. He requested a review of a U.S. policy that
prevents Dominican legal permanent residents (LPRs) from
being appointed as Consuls. Fernandez asked the
Secretary to share information on Government of the
Dominican Republic (GODR) military and civilian officials
who have had their U.S. visas cancelled, so that the GODR
can take action against them if appropriate. Fernandez
specifically asked the Secretary to review cases
involving General Medina Medina, the head of security at
the Palace, and Teonilde Casado de Cheung, Consul General
to Hong Kong. Fernandez said the DR had not benefitted
from CAFTA-DR yet, but that he was hopeful improvements
in the workforce and the DR's competitiveness would bring
positive results over the long-term. Secretary Montas
inquired whether the Millennium Challenge Corporation
(MCC) could show any flexibility on its indicators in
order to allow the DR to receive assistance for education
and health. End Summary.


Counter-narcotics Cooperation
--------------


6. (C) President Fernandez expressed concern over the
security situation as a result of increased drug and arms
trafficking in the region over the last six years. He
said the Iraq war had caused a shift in U.S. policy
leading to a decrease in maritime patrol and air
surveillance. Fernandez requested an increase in U.S.
cooperation, noting that the $2.5 million in Merida money
for FY 2009 was not enough, and referred to the large
amount of resources that had been given to Plan Colombia.
In addition to monetary assistance, the DR also needed
training and technology assistance in order to prepare
personnel to prevent drug trafficking and prosecute
traffickers. The Secretary for Interior and Police
Almeyda specifically noted the need for radar to track
flights and for increased technology exchanges. Almeyda
said that drug trafficking was a sensitive issue for the
DR because it affected tourism and the entire economy.
Fernandez added that the problem must be addressed more
seriously because it weakens institutions through the
corruption of judges and the military.


7. (C) The Secretary emphasized that counter-narcotics
cooperation was a priority for the bilateral
relationship. She said that the United States saw no
evidence that maritime and air surveillance had decreased
over the last few years. She agreed that a plan was
needed for the region and noted the importance of the
upcoming security dialogue with the Caribbean that will
be held in May in Suriname. The Secretary urged the DR
to send a high level representative to the meeting and
asked Fernandez to help the Central American and
Caribbean countries understand the importance of working
together. A/S Shannon added that the United States will
want to hear from countries about their needs for
training and capacity building. He said the United
States understood their concerns about resources and was
trying to identify funding in the FY 2010 budget. The
Secretary said that, while the Merida Plan had been
focused on Mexico and Central America, the U.S. may seek
to expand the initiative and will look at the entire
region. She underscored the need for countries to show a
strong commitment to fighting drug trafficking and not
allowing any safe havens.


8. (C) The Secretary expressed concern that most of the
drugs coming to the DR were being brought through
Venezuela and that there was no way to track those
flights. She asked for Fernandez's help in reaching out
to Chavez to increase cooperation. The Secretary said
that she did not know if Chavez would cooperate at a high
level for planning, but added that the United States
would like to bring Venezuela into the dialogue. The
Secretary told Fernandez he was a critical leader and a
strong partner on these issues. She noted the United
States would like to see him play a more important role
in the region. Fernandez said he hoped he could act as a
bridge on these matters.

CAFTA-DR
--------------




9. (SBU) President Fernandez said that the DR has not
benefitted from CAFTA-DR yet, but that he was optimistic
that the country would see improvements over the next
four to five years. He noted the need to develop a
national strategy for competitiveness, increase worker
productivity, develop a skilled workforce, and increase
technology. Fernandez noted the importance of the U.S.
economy to the DR in terms of investment, remittances,
and tourism. He said it was a priority to strengthen
bilateral relations as a result of these close economic
ties.

MCC
---


10. (SBU) Secretary for Economy, Development, and
Planning Montas said that the GODR had been working with
USAID for several years to improve the indicators for the
Millennium Challenge Account. He noted the GODR had made
the most progress in improving the economic
competitiveness indicators. Montas acknowledged the need
to improve the indicators for investing in education and
health, but said that the 2003 economic crisis had
prevented the government from reaching the required
funding levels. He expressed concern that the global
economic crisis also would limit the availability of
resources for health and education. Montas requested
more flexibility on conditions for meeting the indicators
required for MCC funding in order to provide assistance
for health and education programs. The Secretary noted
that the MCC was established to provide a different model
for assistance. She said the MCC Board oversees the
process and sets the criteria, which they are committed
to meeting. The Secretary said she would like to see if
there is a way to work together to make progress on
meeting the indicators, which are important benchmarks.
She said she would talk to the MCC staff about this
issue.


11. (SBU) President Fernandez said there is a Dominican
law mandating four percent of GDP be devoted to education
spending, but that the GODR is spending only 2.9 percent.
He said he hopes to reach the four percent goal by 2012
and noted the DR has requested a $200 million loan from
the World Bank for education. Fernandez said the GODR is
spending one percent of GDP on healthcare while the law
requires 3.5 percent. He said as a result of the 2003
economic crisis, the government is required to pay $600
million this year to recapitalize the Central Bank.
Fernandez said this payment, in addition to the $700
million required for the subsidy to the electricity
sector, prevented the government from allocating more
money to the health sector.


12. (SBU) In regard to the electricity sector, Fernandez
noted a recently implemented law to criminalize
electricity theft and said the inability of the
distributors to collect revenues from over one million
households was the reason the government needs to provide
the subsidy. He also said that the distribution company,
now owned half by the government and half by a U.S.
company, eventually will become state-owned.



Haiti
--------------


13. (SBU) The Secretary emphasized that the United States
wants to work closely with the GODR on Haiti and that
steps taken to improve the situation in Haiti also will
benefit the DR. She noted that Chief of Staff Cheryl
Mills will be leading efforts on Haiti, including helping
to improve security and increase job creation and
agricultural productivity. The Secretary expressed
support for Dominican investments in textile factories on
the border, where the assembly work is done in Haiti and
the higher value work is done in the DR. She urged
Dominican investors to go back into Haiti and said the
United States would like to work with the DR on
identifying opportunities for investors. Foreign
Minister Morales said the DR-Haiti Mixed Bilateral
Commission would soon start up again and that work had
already begun on identifying the sectors that would be
addressed, including the environment. He also said that
the DR hoped to sign a free trade agreement with Haiti in
five years. The Secretary noted that the environment and
renewable energy go hand in hand and should be considered
jointly. She also noted that migration is a big problem
for the DR. The Secretary said that the United States
has suggestions that the Mixed Bilateral Commission could
consider and would like to work with both countries.

Opening of Consulates and LPR Waivers for Consuls
-------------- --------------


14. (U) President Fernandez expressed interest in re-
opening consulates in Baltimore, Philadelphia, and
Jacksonville, which he said had been closed after
September 11 for security reasons. He also said the GODR
was planning to open new consulates in Houston and New
Jersey, where 300,000 Dominicans reside.


15. (U) Fernandez said that, according to the Dominican
constitution, Dominicans with dual citizenship can be
appointed consuls, as is the case in Europe. However, he
noted the U.S. policy that U.S. citizens and Dominican
legal permanent residents (LPRs) may not serve as
consuls. Fernandez added that many Dominican LPRs have
become community leaders. He asked the Secretary to
review the policy preventing Dominican LPRs from being
appointed consuls. The Secretary said she would look
into the matter.

Visa revocations
--------------


16. (C) Fernandez expressed concern over the lack of
information sharing by the United States in cases
involving government officials who have had their visas
revoked. He noted that currently the United States
cancels the person's visa with no explanation to the
GODR. Fernandez requested a change in the procedure to
provide a reason to the GODR for the cancellation. He
said if there were strong evidence the government could
take appropriate legal action, but without any
information they cannot do anything. Fernandez


specifically requested the Secretary review two cases
involving General Medina Medina, the Head of Security at
the Palace, and Teonilde Casado de Cheung, Consul General
to Hong Kong. He said that there was a power struggle in
the military and this issue was affecting Medina's image.
If Medina had done anything wrong, he would be punished.
Regarding Casado, Fernandez said the government had
reviewed allegations of irregularity in visa issuances
and found no evidence of wrongdoing. The Secretary said
she would look into the matter and get back to him.

Other Topics Raised at April 16 Dinner
--------------


17. (U) On April 16, President Fernandez hosted a small
non-working dinner for the Secretary that included
several prominent Dominican businessmen and entertainers.

U.S. Participants

The Secretary
Charge d'Affaires Bullen
A/S Shannon, WHA
Anne-Marie Slaughter, Director of Policy Planning Staff
Huma Abedin, Deputy Chief of Staff to the Secretary

Dominican Participants

President Fernandez
First Lady Margarita Cedeno de Fernandez
Vice President Rafael Francisco Aburquerque
Carlos Morales Troncoso, Secretary for Foreign Affairs
Temistocles Montas, Secretary for Economy, Development
and Planning
Cabinet Secretary Luis Manuel Bonetti
Presidential Secretary Cesar Pina Toribio


18. (SBU) Topics covered at the dinner included:

Cuba: Fernandez said the United States should do more on
Cuba and that this would be an issue at the Summit of the
Americas. The Secretary said the United States would
wait to see how Cuba responded to changes in U.S. policy.

Pre-clearance: Frank Ranieri, a large Dominican investor
in the tourism sector, asked about the possibility of
establishing pre-clearance for immigration in the DR. He
raised this in the context of Cuba opening up to tourism
and the DR's need to compete. FM Morales also mentioned
this issue in passing during the bilateral meeting.

Renewable energy: Fernandez said renewable energy had
good prospects in the DR, but that the price of oil
needed to remain around $60 per barrel in order to make
this feasible.

Deportees: Fernandez said the GODR needed more
information on deportees in order to better monitor them.
The Secretary said the United States did not currently
have a common database for the prison system, but that
efforts were underway to create one.
CLINTON