US embassy cable - 03TEGUCIGALPA826

HONDURAN PRESIDENT MADURO DISCUSSES UPCOMING MEETING WITH PRESIDENT BUSH, IRAQ, CUBA AND THE PENDING IMF AGREEMENT

Identifier: 03TEGUCIGALPA826
Wikileaks: View 03TEGUCIGALPA826 at Wikileaks.org
Origin: Embassy Tegucigalpa
Created: 2003-04-02 23:13:00
Classification: SECRET
Tags: PREL PGOV PTER SNAR EFIN ETRD ELAB KTIA IZ HO
Redacted: This cable was not redacted by Wikileaks.
This record is a partial extract of the original cable. The full text of the original cable is not available.

S E C R E T SECTION 01 OF 04 TEGUCIGALPA 000826 
 
SIPDIS 
 
STATE FOR TFIZ, IO, PM, S/CT, NP, DRL/IL, EB, AND L 
STATE FOR WHA, WHA/CEN, WHA/PPC, WHA/CCA AND INL/LP 
STATE PASS USTR 
STATE PASS AID FOR LAC/CEN 
DOL FOR ILAB 
 
E.O. 12958: DECL: 04/02/2013 
TAGS: PREL, PGOV, PTER, SNAR, EFIN, ETRD, ELAB, KTIA, IZ, HO 
SUBJECT: HONDURAN PRESIDENT MADURO DISCUSSES UPCOMING 
MEETING WITH PRESIDENT BUSH, IRAQ, CUBA AND THE PENDING IMF 
AGREEMENT 
 
REF: A. STATE 75175 
     B. TEGUCIGALPA 674 
     C. 02 TEGUCIGALPA 3318 
 
Classified By: Ambassador Larry L. Palmer for Reasons 1.5 (B) and (D) 
 
1. (S) SUMMARY:  Honduran President Ricardo Maduro suggested 
that Central American Presidents remain interested in raising 
non-CAFTA topics during their upcoming meeting with President 
Bush.  He also reaffirmed his commitment to provide Honduran 
troops for post-conflict operations in Iraq, even while he 
acknowledged weak public statements of support by the 
Honduran UN Permanent Representative at last week's UNSC 
session.  Maduro concurred that the GOH would review any 
actions in Cuba in light of Fidel Castro,s recent crackdown 
on human rights activists.  Finally, he flagged continuing 
political problems in addressing the escalating public wage 
bill, in particular the challenge of breaking a crippling 
doctors' strike.  He indicated that an IMF agreement remains 
a top priority but said differences remained between the 
Government of Honduras and the IMF. END SUMMARY 
 
2. (U) Ambassador met one-on-one with President Maduro at the 
Casa Presidencial March 28.  Ambassador subsequently met with 
Foreign Minister Perez-Cadalso on April 1 to discuss Iraq and 
other key issues (septel). 
 
-------------------------------------------- 
April 10 Central American Presidents Visit 
-------------------------------------------- 
 
3. (C) President Maduro opened the discussion by raising the 
upcoming meeting between the five Central American presidents 
and President Bush scheduled for April 10 in Washington. 
Maduro reiterated that each president had been assigned 
specific topics to raise with the President and would take a 
regional rather than bilateral approach.  He emphasized that 
the Central American presidents wanted to present their 
vision for the future of the region to the President. 
Specifically, the Presidents had laid out that vision in the 
Roatan Declaration.  The list follows:  Agriculture and the 
asymmetry which should govern our future commercial relations 
(Costa Rica); Central American security, the fight against 
narcotrafficking, terrorism and organized crime (El 
Salvador); Disarmament and reduction of arms in the region 
(Nicaragua); Consolidation of democracy and regional 
integration (Guatemala); and Promotion of investment in 
Central America and the development of infrastructure 
(Honduras). 
 
4. (C)  While deeply appreciative of the opportunity to meet 
with President Bush given the ongoing war, Maduro suggested 
that, in his view, the Central American Free Trade Agreement 
(CAFTA) is only part of the process needed to turn the region 
as a whole "into a success story" and that the presidents 
wanted to make the most out of this meeting with the 
President to advance the U.S.-Central American agenda.   He 
stated that the Central Americans wanted to point out the key 
areas that had to be addressed in the region in order to 
promote needed political and economic integration for 
long-term economic growth and poverty reduction. Ambassador 
reminded Maduro that in this instance, given the short amount 
of time available before the meeting, that remarks should be 
concise, focused, and limited to CAFTA. 
 
-------------------------- 
Maduro Supportive on Iraq 
-------------------------- 
 
5. (S) Ambassador acknowledged President Maduro's supportive 
stance on Iraq and for Honduras joining the coalition.  He 
noted the Government of Honduras' (GOH) support underscored 
the strong relationship between the two countries and that 
Washington was appreciative.  Ambassador also told Maduro 
that Washington was interested in pursuing his offer of 
troops to assist in post-conflict Iraq and encouraged Maduro 
to make a formal offer in writing to the USG so our 
military-to-military planning could move forward.  However, 
Ambassador called attention to USG disappointment with the 
luke-warm statement delivered by Ambassador Manuel Acosta 
Bonilla, the Honduran Permanent Representative to the United 
Nations, during the March 26 Security Council open session on 
Iraq.  Ambassador urged Maduro and the GOH to play a more 
active public role in support of the coalition's goals. 
Maduro reaffirmed Honduras' support for the coalition and was 
apologetic regarding the statement by Acosta Bonilla.  He 
acknowledged that the remarks were insufficient and that they 
did not reflect the solid support Honduras has for the 
coalition's goals.  He went so far as to suggest that he 
would tell the Foreign Minister to remove Bonilla if his 
performance at the UN did not improve.  (COMMENT:  Only the 
President has the legal authority to remove a standing 
ambassador and Maduro is probably aware of this.  In 
addition, given Bonilla's status as one of the Nationalist 
Party's senior statesmen, only Maduro himself would be able 
to dismiss him.  More than likely Maduro's statement was 
intended to deflect criticism of his administration's 
relatively meek public support of the coalition's efforts to 
date. END COMMENT.) 
 
--------------------------------------------- ------------ 
ICC Article 98 Agreement and Counterterrorism Conventions 
--------------------------------------------- ------------ 
 
6. (SBU) Ambassador reiterated the necessity of Honduran 
ratification of the International Criminal Court (ICC) 
Article 98 Agreement and expressed hope the agreement could 
be sent to Congress for action as soon as possible. 
Ambassador also provided President Maduro with a list of five 
outstanding UN and two OAS counterterrorism 
conventions/protocols that the USG would like Honduras to 
sign and/or ratify as soon as possible (ref C).  Maduro did 
not seem fully informed on this subject, confusing the 
Article 98 Agreement with the outstanding counterterrorism 
conventions.  Maduro said he would pass the list to the MFA 
(which Post confirmed he did) but he did not offer any 
time-frame for movement on either the ICC agreement or the 
outstanding counterterrorism conventions/protocols. 
(COMMENT:  The GOH is unlikely to forward the Article 98 
Agreement, or seek congressional action on it, until after it 
secures congressional authorization for the deployment of 
Honduran troops to Iraq. END COMMENT.) 
 
--------------------------------------------- ----------- 
AMB Urges Continued Delay on Honduran Ambassador to Cuba 
--------------------------------------------- ----------- 
 
7. (S) Ambassador called Maduro's attention to the fact that 
Fidel Castro was taking advantage of the conflict in the 
Middle East to crack down on human rights/pro-democracy 
activists in Cuba (ref A).  He directly asked Maduro to 
further delay the appointment of a Honduran ambassador to 
Cuba.  If an appointment is forthcoming in the future, 
Ambassador reminded Maduro that the GOH had agreed to consult 
Post prior to any type of announcement.  Maduro acknowledged 
that he is not very comfortable with Cuba or the Cuban 
doctors in Honduras, referring to concerns that the Cuban 
doctors practice "more than medicine."  However, Maduro once 
again repeated that his administration was not responsible 
for the opening to Cuba and that he had inherited the 
situation from his predecessor.  He promised to keep USG 
concerns in mind in any dealings with Cuba. 
 
--------------------------------------------- ------------- 
Disappointing Results on Honduran Counternarcotics Efforts 
--------------------------------------------- ------------- 
 
8. (S) The Ambassador underscored USG disappointment over the 
lack of effective Honduran interdiction efforts against the 
large amount of illegal narcotics that transit Honduras 
annually.  He pointed out that drug seizures in Honduras are 
at a three-year low.   Ambassador spelled out how corruption 
within the Honduran military and police is undermining law 
enforcement efforts.  He explained that whenever the USG 
passes counternarcotics information to GOH sources it is 
invariably leaked to the traffickers.  Maduro expressed 
dismay and asked if the USG knew who was responsible. 
Ambassador told Maduro the USG was investigating but to date 
had no firm suspects.  However, when the culprits are 
discovered, Ambassador insisted that they be "summarily 
dismissed."  Maduro promised full support on the issue but 
also cited a lack of resources as a major impediment to GOH 
efforts to improve counternarcotics results. 
 
--------------------------------------------- ------- 
Maduro Very Concerned Over Continued Doctors' Strike 
--------------------------------------------- ------- 
 
9. (C)  Maduro then raised his deep concern over the 
continued doctors' strike which began in Tegucigalpa March 18 
and spread nationwide March 24, raising his fears that it 
could cause general instability and that the doctors may try 
to take over hospitals as had been done in the past.  He said 
he was considering dispatching police units to the hospitals 
to prevent this from occurring and that he might be forced to 
declare a "state of emergency," if the situation deteriorated 
further.  (NOTE:  Maduro was scheduled to meet with his 
cabinet later that same day regarding the strike.  Since this 
meeting, the doctors have suspended their strike and have met 
with the GOH to discuss their differences.  The GOH has 
agreed not to fire any of the doctors that were on strike for 
the time being.  END NOTE.) 
 
10. (C)  Negotiations are ongoing. While the proximate cause 
of the strike was a dispute with the Minister of Health Elias 
Lizardi over appointments of doctors in public hospitals, the 
deeper issue is the impending revision of a law which 
guarantees that the basic doctor's salary is 14 times the 
minimum wage which leads to relatively exorbitant salaries 
compared with other public sector employees.  Doctors earn 
anywhere from USD 14,000 - 50,000 a year from just one public 
salary, and many hold two government jobs or have a private 
practice which greatly increases their income.  The 
government must reduce its public wage bill in order to reach 
an agreement with the IMF.  (See para 12 for additional 
detail on IMF negotiations.) 
 
--------------------------------------------- --------- 
Increased Foreign Direct Investment and an IMF Package 
--------------------------------------------- --------- 
 
11. (C) Maduro highlighted that increasing foreign direct 
investment (FDI) remains a high priority for his 
administration.  Maduro referred to a conversation he had 
with Ian Walker (a British economic consultant on the Casa 
Presidencial payroll) who claimed that Honduras would need to 
attract between USD 2.5 to 3 billion annually in order to 
increase GDP by two percent.  Maduro said he was considering 
tax credits, tax forgiveness, duty free status, and other 
measures to accomplish this goal.  Maduro expressed optimism 
that with increased FDI, GDP could rise to the level of 
between five and six percent annually.  Ambassador 
complimented Maduro on his desire to attract increased FDI, 
but noted that the main obstacle to accomplishing this goal 
is deeper reform of the dysfunctional judicial system. 
Ambassador added that "the lack of judicial security," is the 
most serious concern for any prospective investor. 
 
12. (S) During the conversation on FDI Maduro segued into his 
desire to complete an IMF agreement as soon as possible (ref 
B).  Maduro stressed that his administration had been making 
real progress on constraining the budget deficit and that the 
IMF should take that into account.  He also stated he thought 
the IMF was being too dogmatic on the civil service salary 
issue.  The possible revision of laws guaranteeing doctors 
and teachers salaries in multiples of the minimum wage, 
meaning that every raise in the minimum wage leads to large 
raises for doctors and teachers, is a hot button political 
issue.  (COMMENT:  Interestingly, Maduro refrained from 
asking for any type of USG assistance to move the IMF process 
forward.  It appears that he understands the parameters of 
what the USG is willing to do with the IMF. END COMMENT) 
 
Palmer 

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