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### Viewing cable 08SANJOSE66, CAFTA IMPLEMENTATION SNAPSHOT AS OF JANUARY 29

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
08SANJOSE66 | 2008-01-29 18:06 | 2011-03-02 16:04 | UNCLASSIFIED//FOR OFFICIAL USE ONLY | Embassy San Jose
Appears in these articles: http://www.nacion.com/2011-03-02/Investigacion.aspx

`

    VZCZCXYZ0005
    PP RUEHWEB

    DE RUEHSJ #0066/01 0291836
    ZNR UUUUU ZZH
    P 291836Z JAN 08
    FM AMEMBASSY SAN JOSE
    TO RUEHC/SECSTATE WASHDC PRIORITY 9386
    INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE PRIORITY
    RUEHDG/AMEMBASSY SANTO DOMINGO PRIORITY 1580
    RHEHNSC/NSC WASHDC PRIORITY

` `

    UNCLAS SAN JOSE 000066

    SIPDIS

    SENSITIVE
    SIPDIS

    DEPT FOR WHA, WHA/CEN, WHA/EPSC AND EEB; PLEASE PASS TO
    USTR:AMALITO/DOLIVER

    E.O. 12958: N/A
    TAGS: CS ECON ETRD PGOV PINR PREL
    SUBJECT: CAFTA IMPLEMENTATION SNAPSHOT AS OF JANUARY 29

    REF: A. SAN JOSE 00031
         ¶B. 07 SAN JOSE 2070

    ¶1. (SBU) SUMMARY:  Focused on completing CAFTA implementing
    legislation, pro-CAFTA National Assembly (Asamblea) party
    leaders are hopeful regarding the passage of the legislation
    by the first vote before March 1.  Yet, the odds are slim
    given the realities of the Costa Rican legislative process
    coupled with a constitutional review of many of the remaining
    eight bills.  The prospect and method of requesting an
    extension heavily weighs over the CAFTA debate.  Accordingly,
    there is speculation by government and business leaders of
    whether Costa Rica should even request an extension.  The
    argument consists of three points: (1) Costa Rica can deposit
    notice with the OAS acknowledging a "work-in-progress"; (2)
    pressure must be maintained on the Asamblea; and (3) the GOCR
    can sidestep the perceived unpleasant process of negotiating
    extension agreements with its CAFTA partners, specifically
    Nicaragua.  Though interesting discourse, Post consistently
    expresses the position that March 1 signifies the completion
    of the legislation and USTR certification.  Costa Rican
    speculation highlights the need to delineate a USG position
    with an explanation of the USG role at the time of an
    extension request.  END SUMMARY.

    ============================================= ==
    LEGISLATION MOVING: IS FAST TRACK FAST ENOUGH?
    ============================================= ==

    ¶2. (SBU) With fast track rules in place, the pro-CAFTA G38
    coalition continues to move forward on the implementing
    legislation.  Faction chiefs Mayi Antillon (PLN), Lorena
    Vasquez (PUSC) and Luis Antonio Barrantes (ML) are all
    hopeful; they expect the Asamblea to approve (by first vote)
    as many as six items of legislation by the end of February.
    The G38 leaders attribute their progress to three factors:
    (a) a general sense, even in the anti-CAFTA legislators, that
    the Asamblea (and the nation) need to get beyond CAFTA to
    other key initiatives, (b) the new public relations campaign
    against the opposition PAC party and its renowned
    obstructionist tactics, and (c) the fast track rules
    themselves, which limit the number of sessions for debate,
    even when hundreds of amendments are on the table.  With fast
    track, Antillon notes, the legislators can see the light at
    the end of the tunnel.  Despite the optimism of recent weeks,
    several renegade G-38 legislators appear to be using their
    CAFTA support as a bargaining chip in exchange for GOCR
    backing of "home-district" projects.  As for PAC, the PUSC
    and ML are gleefully taking credit for an inspired PR stunt,
    in which they held an impromptu press conference on January 8
    featuring a wheelbarrow stacked high with amendments offered
    by the PAC-led opposition.  Coupled with a GOCR-organized,
    private sector-funded media campaign to get CAFTA done, the
    PAC has been less problematic, according to Vasquez.

    ================
    LATEST SCORECARD
    ================

    ¶3. (SBU) Even with this new "dynamism," progress is still
    slow.  Since our last scorecard (Ref B), two bills (the UPOV
    law and Budapest Treaty) have passed their first plenary
    reading and been transmitted to the Supreme Court's
    Constitutional Chamber (Sala IV) for review.  (On the former,
    PAC members exercised their right to ask for this review,
    which was not required in this case, illustrating that they
    have not given up, yet.)  A second bill (opening the
    insurance sector) moved from committee to the Plenary.  The
    tally as of January 29:

    To be introduced:       1
    In Committee            0
    In Plenary debate       5
    In Mini-Plenary debate  2
    Under Sala IV Review    2
    Fully approved          2

    Of the seven bills in the plenary and mini-plenary, five have
    fast track status.

    ¶4. (SBU) Legislation in the mini-plenary has a "special" fast
    track status which means this legislation is expected to move
    through the Asamblea faster than legislation in the plenary.
    As for the bill yet to be introduced (an amendment to the
    copyright law), it has been purposely held back in order to
    add amendments, if necessary, for IPR issues that may be
    undermined in other CAFTA related IPR legislation currently
    tracking through the Asamblea, according to COMEX
    representatives in Washington.

    ==============================
    MARCH, NO; APRIL OR MAY, MAYBE
    ==============================

    ¶5. (SBU) The G38 optimism remains tempered, however.  None of
    the faction leaders see all the CAFTA legislation being
    completed by March 1.  All three tell us that April or May is
    more likely, considering that the PAC probably will send
    every item to the Sala IV for review, adding as much as
    30-days to the timetable.  Vasquez acknowledges some weakness
    within her own PUSC faction, where one legislator -- more
    loyal to the party's anti-CAFTA leadership than to the
    pro-CAFTA PUSC caucus in the Asamblea -- has missed sessions
    (and blocked quorums) in pursuit of his own agenda.  She,
    Antillon and Barrantes agree that the hard core opposition
    may heat up when universities resume classes in February.
    The G38 leaders also expect the political maneuvering (now
    underway) for the Asamblea's internal elections May 1 may
    also slow progress on legislation.  Antillon has already
    announced that she will not run again to lead the PLN bloc.
    Vasquez and Barrantes may stay on, however.

    =============================
    THE "PARTIAL CREDIT" SCENARIO
    =============================

    ¶6. (SBU) Meanwhile, the Arias administration is apparently
    mulling over next steps.  In a private conversation with the
    DCM on January 17, President Arias wondered aloud if Costa
    Rica could deposit its instrument of ratification with the
    OAS prior to March 1, as a commitment to CAFTA
    implementation, while continuing to push ahead on the
    legislation.  In similar fashion, businessman Carlos Denton
    opined in La Republica on January 23 that the Asamblea should
    just continue to work without a GOCR request for an extension
    since this would avoid brokering extension agreements with
    the CAFTA countries while maintaining pressure on the
    Asamblea.  Besides, he wrote, Costa Rica is already a part of
    CAFTA.

    ===========================
    WHEN TO ASK...NOW OR LATER?
    ===========================

    ¶7. (SBU) In the Ambassador's farewell call on January 21,
    Minister of Finance Guillermo Zuniga asked for an explanation
    of what would happen if the implementing legislation was not
    passed and for advice on talking to partner countries.  The
    Ambassador quickly pointed out that Costa Rica was not in
    CAFTA and it was late.  But, the USG wanted Costa Rica in
    CAFTA hence, the more legislative progress the better.  He
    then described how CAFTA was similar to a partnership, and
    therefore Costa Rica should talk to a representative of the
    partnership, not to individual partners.  Whether the issue
    is the extension or with whom to negotiate the extension, the
    Ambassador's concluding advice was consistent:  call USTR.
    The common theme connecting the President's thinking,
    Denton's opinion, the Finance Minister's questions, and COMEX
    Minister Ruiz's extension questions to the Ambassador in
    early January  (Ref A) is when, and then how, to proceed with
    an extension request.  Clearly, the GOCR is gripped with when
    to make the formal extension request as it hedges the timing
    of such a request against legislative momentum and progress.

    ========
    COMMENT:
    ========

    ¶8. (SBU) Although USTR will ultimately have to make the
    determination, it appears that Arias, and Denton's "partial
    credit" approach falls short of certifiable compliance.
    Their musings are all the more reason we should be ready,
    when the EIF extension request comes, to delineate the USG
    position and explain the USG role.  As for the Asamblea, if
    the G38 discipline continues to hold, then the legislators
    will have accomplished more since December (albeit too late
    to meet the EIF target) than the previous legislature did in
    four years.  We hope their experience will provide important
    lessons in more effective governance, but any wisdom gained
    may be short-lived.  Once the implementing legislation has
    been completed, we expect the G38's unity will begin to
    fracture, as all parties start their open jockeying on other
    priority legislative issues, for party leadership (elections
    on May 1), and for the 2010 national elections.

    BRENNAN

`