US embassy cable - 05PANAMA779 (original version)

CODEL RENZI MEETS PANAMANIAN PRESIDENT MARTIN TORRIJOS, DISCUSSES FREE TRADE AGREEMENT, VENEZUELAN PIPELINE DEAL (original version)

Identifier: 05PANAMA779
Wikileaks: View 05PANAMA779 at Wikileaks.org
Origin: Embassy Panama
Created: 2005-04-07 19:45:00
Classification: CONFIDENTIAL
Tags: PGOV ETRD PREL EPET PM VZ POL CHIEF
Redacted: This cable was redacted by Wikileaks. [Show redacted version] [Compare redacted and unredacted version]
This record is a partial extract of the original cable. The full text of the original cable is not available.

C O N F I D E N T I A L SECTION 01 OF 02 PANAMA 000779 
 
SIPDIS 
 
DEPARTMENT FOR WHA/CEN 
DEPARTMENT PASS USTR FOR AMB. ALLGEIER/RVARGO/AMALITO 
SOUTHCOM ALSO FOR POLAD 
VANCOUVER FOR CG ARREAGA 
 
E.O. 12958: DECL: 04/06/2015 
TAGS: PGOV, ETRD, PREL, EPET, PM, VZ, POL CHIEF 
SUBJECT: CODEL RENZI MEETS PANAMANIAN PRESIDENT MARTIN 
TORRIJOS, DISCUSSES FREE TRADE AGREEMENT, VENEZUELAN 
PIPELINE DEAL 
 
 
Classified By: Ambassador Linda E. Watt for reasons 1.4 (b) and (d). 
 
Torrijos: "I Need Help on Rice" 
------------------------------- 
1.  (C) In a cordial April 1 meeting with President Martin 
Torrijos and Vice President Lewis, Rep. Rick Renzi 
(R-Arizona) said that the USG must get Panamanian government 
(GOP) concessions on Canal procurement and the right of U.S. 
citizens to engage in retail trade to bring the bilateral 
Free Trade Agreement talks to conclusion.  Renzi added that 
the USG must have a "landing zone" on four remaining 
agricultural issues (pork, poultry, sugar, and rice) but was 
confident that negotiators could hammer out a deal if 
procurement and retail trade are resolved.  If Panama agrees 
with that approach, Renzi said, Minister of Commerce and 
Industry (MICI) Alejandro "Andy" Ferrer can confirm it with a 
phone call to Acting USTR Peter Allgeier or AUSTR Regina 
Vargo.  After that, Renzi said, USTR will schedule a final 
round.  In reply, Torrijos quipped that on rice he needs "an 
airport, not a landing zone" and remarked that the two sides 
"are not that close" on the four ag issues.  (Later in a 
pull-aside, Renzi reported that Torrijos claimed to have "no 
wiggle room on rice" and needs "help" at the talks on that 
issue.  Farmers are financing labor groups opposed to the 
GOP's forthcoming proposals to reform Panama's social 
security system, Torrijos claimed.) 
 
Washington Has Taken Note 
------------------------- 
2.  (C) Renzi told Torrijos that Washington has noticed his 
leadership  and that U.S. policy makers regard him as a 
quality leader and a solid friend, whose momentum toward 
better government is working for stability in Panama and the 
region. 
 
Retail Trade "Tough" 
-------------------- 
3.  (C) Vice MICI Minister Paredes also commented on the FTA 
talks at the dinner hosted by Vice President/Foreign Minister 
Samuel Lewis following the Renzi-Torrijos meeting, implying 
that Panama plans to use its leverage on Canal procurement 
and retail trade to extract U.S. concessions on pork, 
poultry, sugar, and rice.  Paredes claimed that the two sides 
had agreed on all procurement issues except the Canal. 
Panama is willing to discuss opening retail trade to U.S. 
investors, Paredes said, but described the issue as "tough" 
for Panama because concluding it will require a 
constitutional amendment.  Paredes discounted suggestions of 
finding a "fix" for the problem, saying investors need to 
come in "through the front door."  (Note: In Panama 
constitutional changes must be approved by two successive 
legislatures, meaning the earliest an amendment could be 
passed would be 2009.)  Paredes predicted that Panamanian 
negotiators would go to the next FTA round with the mind-set 
to close the deal in two or three days at the most. 
 
Torrijos Does Not Yield on Venezuela Pipeline 
--------------------------------------------- 
4.  (C) Further to his one-on-one April 1 pull-aside with 
Torrijos, Renzi reported that he pressed Torrijos to 
reconsider the GOP's receptivity to proposals to modify an 
existing trans-Isthmus pipeline in western Panama to carry 
Venezuelan oil to a Pacific port, presumably for sale to 
China.  Torrijos did not yield, explaining that the project 
would produce much-needed cash for Panama.  Further, Panama 
would be able to control the flow of oil.  Torrijos claimed 
that if Panama refused the project, Venezuela would build it 
through Colombia. 
 
Comment 
------- 
5.  (C) MICI Minister Ferrer will have "full authority" to 
conclude the FTA at the next round (eight rounds have been 
held since 2004), as various GOP officials, including 
Paredes, have assured us.  Unfortunately Ferrer was out of 
Panama on April 1 (he was in East Asia concluding a bilateral 
FTA with Singapore) and could not comment on Rep. Renzi's 
proposals.  If the key to scheduling a new and final FTA 
round lies in confirming Panama's willingness to accede to 
U.S. requests on Canal procurement and retail trade, while 
splitting the difference on ag issues, as Renzi told 
Torrijos, Paredes, and FM Lewis, we did not hear a clear 
endorsement of that approach from the Panamanians on April 1. 
 On Venezuela, Renzi was disappointed that Torrijos hung 
tough on continuing discussions of the pipeline project. 
 
6.  (U) Codel Renzi did not have the opportunity to clear 
this message. 
 
WATT 

Latest source of this page is cablebrowser-2, released 2011-10-04