CHILE MEDIA REPORT - FEBRUARY 25

UNCLAS SANTIAGO 000174

SIPDIS

STATE FOR R/MR, I/PP, WHA/BSC, WHA/PDA, INR/IAA

E.O. 12958: N/A
TAGS: KMDR KPAO PGOV ECON PREL SNAR EFIN CI
SUBJECT: CHILE MEDIA REPORT - FEBRUARY 25

Leading Stories
--------------

1. A U.S. Federal court sentenced Chilean Felipe Moreno to 25 years
in prison on charges of terrorism in connection to arms deals
carried out by Monzer al Kassar. Dailies also reported on remarks
by the FED President that the recession will end in 2009 and the
economy will recover in 2010 if the banking system stabilizes.

U.S.-Related News
--------------

2. Excerpts of "What countries in the region expect of the Obama
government." Several stringers in different countries contributed
the following projections:


3. Chile: The Chile-U.S. FTA has led to an explosive increase in
bilateral trade between the two countries and this seems to be
encouraging others in the region to follow the same path. The FTA
has provided mechanisms to resolve an array of trade issue, such as
sanitary regulations; created a committee that periodically reviews
the treaty's progress, and resulted in clear commercial rules. All
of this has allowed Chile to expand its exports and turn into the
country with the highest number of free trade agreements in the
region.


4. Colombia: Bogota has enjoyed a "privileged" relationship with
the United States over the last ten years thanks to an array of
shared interests, and this will not change, especially in the area
of narcotics. But the economic crisis does not present a favorable
scenario for the approval of the FTA in the U.S. Congress, and
Colombia will therefore focus on expanding the benefits of the trade
preference system under the Andean Trade Promotion and Drug
Eradication Act (ATPDEA).


5. Brazil: Bilateral relations will depend on U.S. economic
performance and on Obama's ability to deal with issues that have
traditionally dominated the relationship, such as immigration,
trade, and energy. There are yet no signs that Washington is
developing measures to address the thousands of Brazilian immigrants
in the United States. Furthermore, Brazil strongly believes that if
the economic situation worsens, the U.S. will tighten its control on
immigration.


6. Peru: Peru is among those countries that are strengthening ties
with Washington through an FTA. However, there are questions about
bilateral cooperation in the area of narcotics, because Washington
considers that Peru must increase the eradication of coca
plantations and improve on seizures.


7. Mexico: Nothing indicates that Mexico will be a priority for
the United States. Mexico has unsuccessfully fought for the
approval of an immigration law to benefit its seven million
immigrants in the United States. And although Obama won a
significant portion of the Latino vote with the promise of such a
law, neither he nor the new Congress has addressed this particular
issue. During his campaign, Obama also called to review the Nafta
trade deal to protect U.S. workers, a stance that Mexico opposes.
The ups and down in the bilateral relationship are a reminder that
the U.S. has interests, and not friends, and that we (Mexicans)
shouldn't have high expectations of being treated as equals by
Washington. Experts concur that Mexico must strengthen its
participation in other areas of U.S. society, beyond immigration,
Nafta, and narcotics to attract attention from the U.S.
administration.


8. Venezuela: There is no question that countries such as Brazil,
Chile, Peru... will strengthen their ties with the United States,
but I don't believe Venezuela or its president will assume a normal
and respectful relationship with Washington. That does not fit with
President Chavez' authoritarian plan or his hemispheric order.
Chavez criticized Obama, but words don't mean much, because
bilateral trade between the United States and Venezuela reached
record figures last year. However, the United States is looking for
an alternative to Venezuela oil and we should not be surprise if
Brazil becomes that alternative.


9. Editorial: "Obama, Expectations and Truths"
"Cold-headed observers warn that the popular enthusiasm (with Obama)
has not spilled over into the markets. Analysts pointed out, for
example, that as the President gave his inaugural speech, Wall
Street dropped 4%" (La Segunda, conservative, afternoon (circ.
33,000),2/24).


10. A Wall Street Journal article Says Chile's Stock Market is a
"refuge" for investors, noting that Chile
is among the few markets on the rise this year (El Mercurio, 2/25).



11. A U.S. Federal court sentenced Chilean Felipe Moreno to 25 years
in prison. Moreno was found guilty of four charges of terrorism and
arms sales in connection to operations led by Syrian arms dealer
Monzer al Kassar (All dailies, 2/25).

President Obama's Address to Congress
--------------

12. Headline: "Obama: 'The U.S. will recover and emerge even
Stronger'"
Subheadline: The U.S. President described with harshness the
problems his country faces, but offered hope for recovery.
Lead: In his first speech before Congress, President Obama told the
American people that the United States, "will emerge stronger than
before," from the current economic abyss and assured that better
times will come thanks to everyone's hard work and courage (El
Mercurio, conservative, influential newspaper-of-record, circ.
129,000, 2/25).


13. Headline: "Obama Presents Congress an Ambitious Program to
'Rebuild' the United States"
Subheadline: With an optimistic speech to Congress, the U.S.
President said that in addition to reactivating the economy, he
would promote a political agenda that will include a health reform,
alternative energy, and education reform. He also said he would
revoke tax cuts decreed by Georg W. Bush, but assured that he would
counter with a tax deduction "for 95% of the people" (La Tercera,
conservative, independent, circ. 101,000, 2/25).

Drug Seizures at Airport Near Peru Border
--------------

14. The arrest of a large number of foreigners over the past month
in Chile's international airport Chacalluta, in Arica, would be
evidence that international narcotics organizations are "testing a
new route" to smuggle drugs to Europe, said the head of the
counter-narcotics brigade of the Investigations Police in the
Santiago international airport, Elias Arriagada (El Mercurio, 2/25).


SIMONS