CHILE MEDIA REPORT - APRIL 27

UNCLAS SANTIAGO 000398

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 - APRIL 27

Leading Stories
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1. Presidential candidate Sebastian Pinera placed all his assets
into a blind trust, with the exception of television station
Chilevision. Pinera did, however, resign from the TV station's
board of directors.

U.S.-Related News
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2. President Bachelet invited Governor Arnold Schwarzenegger to
visit Chile for the Competitiveness Forum of the America, scheduled
in September. Reportedly, Chilean Ambassador Jose Goni handed the
governor the official invitation on Thursday (El Mercurio,
conservative, influential newspaper-of-record (circ. 129,000,
4/25).


3. Foreign Ministry International Economic Affairs Bureau, DIRECON,
attorneys are gathering information on the accusation filed by the
Chile's Wood Corporation (CORMA) concerning unfair competition on
the part of U.S. cellulose producers. The MFA will issue a report
before May 15, to determine whether this controversy will be
resolved through the bilateral FTA resolution mechanism (El
Mercurio, 4/25).


4. Charles Kimber, Corporative Manager of Cellulosa Arauco and
AMCHAM Director, said that the subsidy that U.S. cellulose producers
are receiving -- up to 50% of the cost to produce one ton of product
-- severely undermines free trade, because "no company can compete
with that kind of subsidy." Kimber said that CORMA had been
informed by other international cellulose producers of the problem
(El Mercurio, 4,27; Diario Financiero, business and financial, circ.
30,000, 4/27).


5. Editorial: "Forestry Sector Subsidy"
"The main threat of this subsidy is that it shows that a
protectionist wave is extending worldwide, with the subsequent
danger for global trade and Chile's exporting industry" (Diario
Financiero, 4/27).


6. Editorial: "Protectionist Measures"
"The United States is subsidizing its cellulose producers, which is
affecting the ability of Chilean producers to compete in that
country. The Foreign Ministry's Economic Bureau must strengthen the
observation of these bad practices and ensure the protection of the
rights we acquired when we signed the free trade agreement" (El
Mercurio, 4/26).


7. Finance Minister Andres Velasco commented on his meetings with
IMF and J.P. Morgan officials, the President of the U.S. Federal
Reserve Ben Barnanke, and Treasury Secretary Tim Giethner. Velasco
said that it became evident from the discussion that Latin America
is the better positioned than other regions to withstand the global
economic crisis, and that within the region, Chile has the most
significant expected growth rate for the coming year (El Mercurio,
4/26).


8. In a local television interview, President Bachelet said she had
been impressed with President Obama at the SOA in Trinidad and
Tobago. "President Obama had a very positive impact (on me). He is
a serious man, very knowledgeable... and politically very clear. He
left an excellent impression and, on top of that, he has a sense of
humor (La Tercera, conservative, independent, circ. 101,000, 4/26).


New Chilean Ambassador to Ecuador
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9. Juan Pablo Lira, the third highest-ranking official in the
Foreign Affairs Ministry, was appointed Ambassador to Ecuador. This
shows the importance that Chile assigns to its ties with Quito;
Ecuador signed the 1952 y 1954 treaties that established Chile's
maritime borders. Peru is contesting the maritime issue in The
Hague (El Mercurio, 4/25).

Venezuela
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10. In a television program, President Hugo Chavez announced he
would travel to Argentina next week and said that President Bachelet
had phoned him on the April 25 inviting him to visit Chile (El
Mercurio, 4/26).
URBAN