A/S Valenzuela Reviews Regional Issues with Chilean Foreign Minister Fernandez

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10SANTIAGO9 15 January 2010 Confidencial Embassy Santiago

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E.O. 12958: DECL: 2020/01/15
TAGS: PREL, ETRD, SNAR, OAS, CI, HO, BL
SUBJECT: A/S Valenzuela Reviews Regional Issues with Chilean Foreign
Minister Fernandez

REF: SANTIAGO 38

CLASSIFIED BY: Paul Simons, Ambassador; REASON: 1.4(B), (D)

1. (C) Summary. In a January 12 meeting with WHA A/S Valenzuela,
FM Fernandez pressed to set the timing for an extraordinary OAS
meeting to elect a new Secretary General. The two discussed
Honduras, agreeing on the importance of resolving the status of
both de facto President Micheletti and President Zelaya. On
Bolivia they considered possible regional cooperation to combat
drug trafficking in that country. They discussed the possibility
of the United States initiating confidence building measures with
UNASUR, in part to deflect tension arising from the U.S.-Colombia
DCA. They also reviewed the (pre-earthquake) situation in Haiti
and Chile’s relations with Peru and Argentina. They signed an
extradition treaty and an MOU on U.S./Chile cooperation in third
countries. End summary.

2. (U) Assistant Secretary Valenzuela met with Foreign Minister
Mariano Fernandez on February 12. Fernandez was accompanied by
Under Secretary Angel Flisfisch, Ambassador to the U.S. Jose Goni,
and Director for North America Isauro Torres. The U.S. delegation
included the Ambassador, EPOL Counselor, and Senior Political
Officer.

TWO NEW BILATERAL AGREEMENTS

3. (U) Fernandez opened the meeting by noting the importance of
two documents that he and the Assistant Secretary were to sign
immediately following their meeting, a new extradition treaty and a
memorandum of understanding on development cooperation in third
countries. Fernandez said that the U.S./Chilean trilateral
development cooperation builds on similar work that Chile is doing
with Japan and hopes to start with Australia. He welcomed the new
extradition treaty as an upgrade to the existing treaty that was
signed in 1900 and highlighted the importance of combatting
international crime.

OAS

4. (SBU) Fernandez raised Chile’s request that the Organization of
America States (OAS) set a date for an extraordinary general
assembly to consider the reelection of Jose Miguel Insulza as
Secretary General. Fernandez noted that the date for the
discussion of this request had been pushed back from January 13 to
January 20. He emphasized that Chile is seeking to establish an
improved institutional framework to select OAS Secretaries General.
To reinforce his case, he cited several instances of long lame-duck
periods or gaps. He said some Secretaries General were elected
more than six months before the incumbent left office, while
Insulza’s term expires May 25 but the next regular general assembly
will be in June. He argued that it would be best to hold the
election before Insulza’s term expires to simplify any transition.
Chile believes that there should be a transition period of at least
three months, so the election could be held in January, February or
early March. Fernandez acknowledged that Insulza is seeking
reelection but asserted that even so, he would likely change some
of his team. He concluded by claiming that 30 countries support
Chile’s proposal, with the United States and Venezuela as the hold
outs. He added that Venezuela is holding out because it hopes to
identify an ALBA candidate, but he did not understand U.S.
concerns.

5. (SBU) A/S Valenzuela said that while the United States does not
have a position on Insulza’s candidacy, he now had a better
appreciation for the reasons behind Chile’s request for the
extraordinary session. He said that the United States would
consider the matter and that he would be back in touch with FM
Fernandez to discuss dates.

HONDURAS

SANTIAGO 00000009 002 OF 003

6. (C) In response to Fernandez’s inquiry about Honduras, the
Assistant Secretary said the situation is complicated, since the
parties there have not fully complied with the San Jose-Tegucigalpa
Accord. He added that the election of Porfirio Lobo as president
is an important but not sufficient development to restore Honduras
in the international community. He continued that a major
challenge is the status of both de facto president Micheletti and
President Zelaya. He wondered if Brazil, which has offered Zelaya
refuge at its embassy in Tegucigalpa, would be willing to receive
Zelaya. Fernandez agreed that Zelaya’s presence in Honduras is a
problem and offered to talk to Brazil about the matter.

BOLIVIA

7. (SBU) Fernandez turned to Bolivia, saying that while the two
countries do not have full diplomatic relations, Chile enjoys the
best imaginable non-diplomatic relations with Bolivia. He said
that Chile has tried to promote stability in Bolivia and provide a
positive influence. He added that Chile is looking to work with
Bolivia on its request for access to the sea, but noted that Peru’s
maritime dispute with Chile could affect Chile’s ability to work
with Bolivia, as it could cut off maritime access for any sovereign
corridor. He then turned to the Andean Trade Preferences Act
(ATPA), noting the value of Bolivia’s renewed participation in the
program along with the other Andean beneficiaries.

8. (C) A/S Valenzuela replied that the big problem for the United
States is that Bolivia has expelled Drug Enforcement Administration
(DEA) agents from Bolivia, severely compromising Bolivia’s ability
to combat drug trafficking. He noted that increased Bolivian drug
flows create problems for Bolivia’s neighbors, including Chile,
Brazil, Argentina, and Paraguay. He suggested that the United
States look for ways to work with those neighboring countries to
jointly promote counternarcotics efforts in Bolivia. If
successful, that effort would both reduce narcotics flows and
facilitate Bolivia’s participation in the ATPA. In response,
Fernandez said, "Let’s do something."

PERU AND ARGENTINA

9. (C) Fernandez said that there are strong anchors in Chile’s
relations with Peru, with over $7 billion in Chilean investments in
Peru and a large resident Peruvian community in Chile. He
attributed the problems in Peruvian-Chilean relations to a core
group close to President Garcia, but said that Chile is not worried
about those complications because it knows how to handle them.
Fernandez said that Chile’s relations with Argentina are excellent,
noting that the two countries have agreed to construct a tunnel
through the Andes to facilitate travel between them as part of a
new integration treaty.

HAITI

10. (SBU) Reflecting on the U.S.-Chile agreement to cooperate on
development projects in third countries, Fernandez said that Chile
has 200 police officers working in Haiti, and wondered if
U.S.-Chile cooperation could be extended to Haiti. He noted that
government institutions in Haiti are weak and institutional
rebuilding is insufficient. He asked whether the World Bank and
the Inter-American Development Bank could play a larger role in
infrastructure and institution building, to which A/S Valenzuela
said that the lenders are considering the matter. (Note: This
discussion took place before the large earthquake hit Port au
Prince later on January 12. For Chilean emergency assistance to
Haiti, see reftel.)

SANTIAGO 00000009 003 OF 003

UNASUR AND THE DCA

11. (C) Fernandez said that the U.S./Colombia Defense Cooperation
Agreement (DCA) is still a sensitive point for some South American
countries and makes Colombia an easier target for criticism,
particularly by Chavez. He asked how the United States could help
lower profile of the DCA. A/S Valenzuela said that Ecuador, as
president pro tempore of UNASUR, in response to a letter on DCA
from Secretaries Clinton and Gates, had asked whether the United
States would be willing to enter into a discussion with UNASUR.
The Assistant Secretary said that the United States is waiting for
Ecuador to define the terms of reference for the discussion. He
added that he is also considering what confidence building measures
the United States and UNASUR could jointly undertake. Fernandez
welcomed the suggestions, and Under Secretary Flisfisch said that
Brazil should be brought into the process early on. Ambassador
Goni suggested that the confidence building measures should include
social projects, although Flisfisch cautioned that the social side
of UNASUR is new, while the defense discussions are well
established.

BILATERAL RELATIONS

12. (U) As the meeting concluded, the Ambassador noted that
discussion had focused on pressing regional issues. The absence of
concerns on the bilateral side reflects the excellent state of
bilateral relations.

SIGNING CEREMONEY AND PRESS CONFERENCE

13. (U) After the meeting, the Assistant Secretary and Foreign
Minister signed an extradition treaty and MOU on trilateral
cooperation. After the signing ceremony they held a brief press
conference.

14. (U) The Assistant Secretary cleared this cable.
SIMONS