YOUR VISIT TO EL SALVADOR

S E C R E T SAN SALVADOR 000802

SIPDIS

FOR GENERAL FRASER FROM CHARGE D'AFFAIRES

E.O. 12958: DECL: 08/21/2019
TAGS: PGOV MARR ES
SUBJECT: YOUR VISIT TO EL SALVADOR

Classified By: Charge d'Affaires, for reasons 1.4 (b) and (d)


1. (S) Summary: Embassy San Salvador warmly welcomes you to
El Salvador. Your visit reinforces the U.S. policy of active
engagement with the GOES, which strengthens the moderate,
pragmatic elements in the new government. President Mauricio
Funes has stated his desire to make the U.S. and Brazil his
closest allies, though the orthodox part of the left-wing
FMLN is trying to pull his administration in a more radical
direction, and carries out its own foreign policy. President
Funes' non-FMLN campaign support group, the Friends of
Mauricio (now renamed the Citizen Movement for Change),is
largely in control of the economic apparatus of El Salvador.
Similarly, Defense is in the hands of a formerly-retired,
recently-promoted military officer and Friend of Mauricio,
Brigadier General David Munguia Payes. FMLN hard-liners are
at the helm of the security, education, and intelligence
apparatus. Foreign policy is in the hands of a loyal FMLN
member, but has thus far been characterized by pragmatism and
outreach to the U.S. Assistance programs are moving forward
successfully but some police and security programs are under
review. Our mil-to-mil relationship is solid, typified by
the successful visit of the USNS Comfort. End Summary.

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Good Relations with U.S. Essential
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2.(C) On the day he was inaugurated, President Funes told
Secretary of State Clinton that his Salvadoran government
needs a good relationship with the United States. One out of
every three Salvadorans lives in the U.S., and Salvadorans
who remain at home are avid consumers of all manner of
American products, media, and culture. Half of all
Salvadoran exports are to U.S. markets. Given the
transnational crime links radiating to and from the U.S. via
Central America, there are no serious alternatives to
cooperation with our law enforcement. The Salvadoran
military admires and trusts our armed forces, and naturally
look to us for training, equipment, and mentoring. When
natural disasters strike, the U.S. Embassy (especially USAID)
has always been the Salvadorans' first phone call, and always
will be. As a result, the Salvadoran public is among the
most pro-American in the hemisphere. Even the hard-line FMLN
recognize these points, if at the same time they do not
forget our role in preventing them from seizing power with
violence during the country's protracted and bloody civil war.

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Scope of Bilateral Relationship
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3.(SBU) The size and scope of the U.S. Embassy --
representing some 18 federal agencies in total -- reflects
the breadth of our bilateral relationship as well as our
commitment to Central America. Among the major programs
executed by this mission are the following:

-- Millennium Challenge: We are two years into a five-year
compact valued at 461 million dollars, the largest MCC
compact in the hemisphere. The main component is a highway
that extends across the northern third of the country. Funes
himself has presided over ribbon-cutting ceremonies for MCC
projects during the month of August.

-- Law Enforcement: El Salvador is a beneficiary of the
Merida Initiative, with funding for the National Civilian
Police (PNC),prisons, judiciary, and the International Law
Enforcement Academy (ILEA). El Salvador's hosting of ILEA is
an ongoing success story. FBI Director Mueller visited last
December and inaugurated an INL-funded state-of-the-art
automated fingerprint identification system (AFIS). The FBI
and the Salvadoran PNC jointly operate the Transnational
Anti-Gang Center, a unique bilateral entity tasked with
investigation and information sharing.

-- USAID: Current programs include fiscal policy, trade,
health, education, environment, tax administration, rule of
law, and democracy building. USAID enjoys a prestigious
reputation in the country; it is also about to take in dozens
of new USAID trainees, pursuant to a USG directive to
increase world-wide AID staffing.

-- Peace Corps: The Peace Corps maintains an active presence
throughout El Salvador, with volunteers working on rural
health, development, literacy, and sanitation.

-- Military: El Salvador had troops in Iraq from August 2003

until early 2009 and were considered professional and
competent by U.S. and coalition members. Their experience and
President Funes' desire for excellent relations with the USG
could translate into a commitment to deploy to Afghanistan.
We have ongoing cooperation and training programs intended to
maintain a rich mil-to-mil relationship in humanitarian
assistance/disaster relief, counter-terrorism, and
counter-narcotics. We recently renewed the agreement to
operate a Cooperative Security Location (CSL) for another
five years. The CSL, located at the military end of the
international airport, serves as a regional hub for
counter-drug detection-and-monitoring flights. The first
contingent of Salvadoran peacekeepers returned from Lebanon
on August 24. In June the USNS Comfort visit provided
medical attention to nearly 20,000 people and two engineering
projects to rural communities. In July and August, MILGP
coordinated and facilitated two MEDRETEs in the northern zone
and has a third scheduled for September.

-- CAFTA: El Salvador was the first country where CAFTA
entered into force and has become a huge beneficiary. By
2007, 78 percent of exporters under CAFTA were micro, small,
or medium enterprises, which principally export
non-traditional products such as 'ethnic' foods. This has
helped diversify El Salvador's economy and create new job
opportunities, especially for women and the rural poor. CAFTA
has also helped El Salvador increase its exports to its
Central American neighbors, strengthening regional
integration.

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U.S. Priorities
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4. (C) Our work in El Salvador is focused on (1) promoting
improved public security; (2) supporting stable, democratic
governance; (3) broadening economic prosperity; and (4)
investing in people.


5. (C) Although El Salvador has made remarkable progress
since the 1992 Peace Accords, violent crime remains
unresolved. Street gang activity such as extortion, robbery,
and kidnapping undermine public security and erode confidence
in the ability of the police and the judiciary. The Merida
Initiative, coupled with ongoing efforts to strengthen the
police and enact judicial reform aims to improve public
security and the rule of law. Recent Legislative Assembly
approval of a constitutional amendment to permit wiretapping,
with broad political support, is an important step;
implementing legislation is in the works. The significant
USG commitment to improving regional security, as evidenced
by the presence of the Comalapa Cooperative Security Location
(CSL) and the International Law Enforcement Academy (ILEA),
should also provide us with additional credibility with the
oncoming Funes administration.


6. (S) Although law enforcement cooperation between the GOES
and USG traditionally has been strong, the new Minister of
Public Security and Justice, Manuel Melgar, has been linked
to the 1985 Zona Rosa attack which killed four off-duty U.S.
Embassy Marine Security Guards and other Americans and
Salvadorans. Law enforcement cooperation has not been
frozen, but full implementation of the Merida Initiative is
now contingent upon guidance from Washington regarding how
best to work around Melgar. Thus far, Melgar's presence as
Minister has resulted in a distancing from the USG, a far cry
from the close relationship we enjoyed with his predecessor.


7. (C) Promoting economic growth, spurring job creation, and
encouraging investment are important near-term USG
priorities. Funes' electoral victory had a great deal to do
with public dissatisfaction over economic conditions in El
Salvador. Funes inherits an economy already in recession and
a fiscal deficit which severely limits what he can do to
stimulate growth. Redirecting loans from multilateral
institutions from debt-refinancing to budget assistance will
provide some immediate relief. El Salvador's economic
recovery will largely depend on the U.S. economy, the
destination for about half of its exports and major source of
remittances ($3.8 billion in 2008). In the short run, the
Millennium Challenge Corporation project will provide
much-needed fiscal stimulus and new jobs, while CAFTA and our
USAID assistance programs will help strengthen the
foundations for future prosperity.

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The Way Ahead
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8. (C) Although the Salvadoran electorate may have granted
President Funes a mandate for reform, by all appearances the
Salvadoran public at-large expects him to work with the
country's dynamic private sector, and to maintain good
relations with the United States. Center-right ARENA must
come to grips with its electoral defeat and assume its new
role as an opposition party. ARENA and other opposition
parties, civil society leaders, business interests, and the
press are all reasonably solid institutions. They also pay
attention to signals from the USG, which traditionally has
great influence in El Salvador. Your visit will provide a
vote of confidence in El Salvador's stability, which takes on
added importance in light of Honduras' meltdown next door.
BLAU