NEW MINISTER OF AGRICULTURE OUTLINES VISION FOR

UNCLAS SECTION 01 OF 02 SAN SALVADOR 000647

SIPDIS

E.O. 12958: N/A
TAGS: EAGR EAID PGOV SOCI EFIN ES
SUBJECT: NEW MINISTER OF AGRICULTURE OUTLINES VISION FOR
AGRICULTURAL ASSISTANCE, ANTI-CRISIS EFFORTS


1. (U) SUMMARY. New Minister of Agriculture Manuel Sevilla
discussed his Ministry's role in the Government of El Salvador's
(GOES) "anti-crisis" plan and his views on agricultural assistance
during a June 25 courtesy call. The Ministry of Agriculture's
anti-crisis program will focus on a combination of short-term
projects, like more efficient seed and fertilizer distribution, and
long-term goals, including coffee plantation restoration. Sevilla
viewed diversification to higher income crops as essential to
reducing rural poverty and expressed a strong interest in trade
capacity building programs. A technocrat, Sevilla indicated that he
understood the importance of markets, value chains, and technology
to agricultural growth. Sevilla, his team, and the Vice Foreign
Minister for External Cooperation all appeared eager to continue
agricultural cooperation with the USG. END SUMMARY.


2. (U) On June 25, Guatemala-based Ag Counselor, A/Econcouns, and Ag
Specialist called on new Minister of Agriculture and Livestock
Manuel Sevilla. New Vice Minister Hugo Flores and soon-to-be-named
Director for Policy Armando Maldonado also participated. Ag
Specialist spoke separately with Vice Foreign Minister for External
Cooperation Jamie Miranda on June 30.

ANTI-CRISIS PLAN
--------------


3. (U) Asked about the Ministry of Agriculture's (MAG) role in the
GOES's recently announced "Anti-Crisis Plan," Sevilla said he wanted
to make sure MAG's efforts addressed both the short term and the
long term. Planned activities include:

- More efficient, larger scale, and better targeted distribution of
seeds and fertilizers. Sevilla remarked that the existing
distribution program had been heavily politicized, rendering it less
effective. MAG would also import fertilizer directly from abroad to
lower costs and avoid the handful of companies that controlled the
El Salvador market.

- More efficient use of public and donor funds to improve the
execution rate of agricultural development projects.

- Restoration of coffee plantations through the replanting of 30
million trees. MAG would share the costs with the private sector.

- Expansion of agricultural financing through the state-owned Banco
de Fomento Agropecuario. Sevilla said that $20 million was
available during the first 100 days of the new government.

- Increased technical assistance to small growers.

- Implementation of crop insurance.

- Reduced foreclosures on delinquent agricultural loans.

SPS ISSUES
--------------


4. (U) Ag Counselor raised the case of a US company that was having
its imports of pre-cooked pork patties blocked by product standards
that were not scientifically based. Sevilla responded that new
personnel would be joining the office responsible for sanitary and
phytosanitary (SPS) standards in early July, which should address
the situation. This office, Sevilla stated, was where he had found
corruption at MAG. The previous office staff had developed a
too-close relationship with parts of the private sector, and it had
been using its powers to help preserve certain oligopolies. In his
view, it was far-fetched for a developing country such as El
Salvador to call into question the food safety standards for
products being imported from countries such as the U.S. and New
Zealand.

AGRICULTURAL COOPERATION
--------------


5. (U) Ag Counselor and Ag Specialist briefly outlined existing USDA
technical assistance programs, emphasizing their benefits to
growers, small and medium enterprises, and exporters, including
programs to take advantage of CAFTA-DR. Ag Counselor encouraged
Sevilla to visit Washington and explain MAG's agricultural
development strategy to Secretary Vilsack.


6. (U) Sevilla expressed a strong interest in trade capacity
building and technology. In Sevilla's view, production of
traditional crops like corn and beans was not the solution to rural
poverty, and diversification to higher income crops was critical.
To be most effective, Sevilla stressed, MAG would also have to
coordinate closely with other Ministries. When asked about other
assistance in agriculture, Sevilla said that the GOES was in final
discussions with the Government of Brazil about opening an office of

SAN SALVAD 00000647 002 OF 002


the Agricultural and Livestock Research Service (EMBRAPA) in El
Salvador.


7. (U) On June 30, Vice Foreign Minister for External Cooperation
Jaime Miranda also contacted Ag Specialist to discuss food
assistance (NOTE. Food For Progress (FFP) programs are run in
conjunction with the Ministry of Foreign Affairs (MFA). END NOTE)
Miranda said the GOES was grateful El Salvador was back on the
priority list for FY2010 FFP, and the MFA was preparing a proposal.
Miranda, who participated in the May 31 Pathways to Prosperity
Ministerial, said that their proposal would be based on the contents
of the Pathways declaration. Miranda also assured Ag Specialist
that all USDA funds would be administered under established
procedures to provide transparency and comply with each project's
stated goals.


8. (U) COMMENT: Sevilla appeared very much the technocrat that his
biography suggested. His comments indicated that he understood the
importance of markets, value chains, and the use of technology in
promoting agricultural growth. Sevilla, his team, and VFM Miranda
all seemed eager to continue cooperation with the USG on
agricultural development.


9. (U) BIO NOTE: Sevilla has a PhD in Public Finance and a Master's
Degree in Economics from Syracuse University. He also has a degree
in Economics from Bates College (Lewiston, Maine). He has worked as
chief of the UNDP's Democratic Governability Program and as the
World Bank's Finance, Infrastructure and Private Sector Chief for
Central America. His son currently attends the University of
Rochester.

Blau