US embassy cable - 04TEGUCIGALPA2313

UNCLAS SECTION 01 OF 02 TEGUCIGALPA 002313 
 
SIPDIS 
 
STATE FOR WHA, WHA/CEN, WHA/EPSC, DRL/IL, AND EB 
STATE PASS AID FOR LAC/CAM 
STATE PASS USTR 
DOL FOR ILAB 
 
E.O. 12958: N/A 
TAGS: ETRD, ELAB, EINV, PGOV, HO 
SUBJECT: "Cumple y Gana" Labor Project Advances CAFTA 
Understanding with Private Sector 
 
 
1.  Summary: The U.S. Department of Labor-funded "Cumple y 
Gana" project held two recent public outreach events in 
Honduras, aimed at informing the private sector as to the 
contents and implications of CAFTA-DR with regards to 
protection of labor rights and enforcement of labor laws. 
EconOffs participated in the program, along with Honduran 
Minister of Labor and private sector representatives. 
Turnout was good, press coverage was positive, and overall 
the events marked a strong first step in the important 
effort of educating the Honduran public about CAFTA-DR, and 
correcting the many misperceptions that persist.  End 
summary. 
 
2.  The "Cumple y Gana" project held two recent public 
outreach events in Honduras: in Tegucigalpa on September 29 
and in San Pedro Sula on September 30.  The project, whose 
full title is "Strengthening Labor Systems in Central 
America: Cumple y Gana (Comply and Win)", is funded by the 
U.S. Department of Labor, and being carried out in Central 
America by the Costa Rican NGO FUNPADEM (Foundation for 
Peace and Democracy) and by Abt Associates.  Within 
Honduras, FUNPADEM is partnering with the private sector 
umbrella organization COHEP (Honduran Private Enterprise 
Council).  The launch of the project in March was attended 
by President Maduro and Ambassador Palmer. 
 
3.  While the Cumple y Gana project has various objectives, 
including providing training to strengthen Ministry of Labor 
inspection services and strengthening alternative dispute 
resolution mechanisms, the September events were focused on 
increasing public awareness of the labor provisions 
contained in CAFTA-DR.  Each event was attended by roughly 
75 people from the private sector - not CEOs and company 
presidents, but rather personnel officers and people closely 
involved with the day-to-day management of labor issues. 
(FUNPADEM plans to hold additional outreach events aimed at 
workers and labor unions in the future.) 
 
4.  The two key presentations at the event were delivered by 
Armando Urtecho, a lawyer for COHEP who explained the labor 
chapter of CAFTA-DR, and by EconOffs, who explained the 
dispute settlement mechanisms outlined in the agreement. 
Given the low level of knowledge that prevails among the 
private sector as to exactly what the CAFTA-DR agreement 
says regarding the enforcement of labor laws, these two 
presentations were very positively received.  The average 
Honduran businessman seems to have only a vague sense that 
CAFTA-DR will reduce Honduran sovereignty by giving the 
United States the right to ultimately impose "fines" of USD 
15 million at will if Honduras fails to meet first-world 
labor standards.  EconOffs took pains to dispel the myths 
and correct the many misperceptions inherent in this view. 
Specifically, EconOffs emphasized that CAFTA-DR requires 
only the enforcement of member countries' own labor 
legislation; requires the protection of fundamental, 
internationally recognized, labor rights which are contained 
in the core conventions of the ILO (International Labor 
Organization); establishes a dispute-settlement process that 
focuses on consultation and cooperation, and can assess 
monetary contributions only as a last resort. 
 
5.  At the Tegucigalpa event, other speakers included 
Executive Director of FUNPADEM Dr. Rodolfo Piza, President 
of COHEP Jose Maria Agurcia, and Honduran Minster of Labor 
German Leitzelar.  Leitzelar took pains to counteract the 
perception that CAFTA-DR represents a loss of Honduran 
sovereignty, by pointing out that under Honduran law, 
international treaties do not supersede the Honduran 
constitution, but rather become incorporated into the 
constitution.  As he often does, Leitzelar also emphasized 
that Honduras' labor legislation already protects the 
fundamental labor rights which CAFTA-DR covers, and that 
Honduras has ratified all eight of the core ILO conventions 
(he pointedly stressed that the United States has ratified 
only two).  But he urged participants to place a greater 
emphasis upon enforcement, not because of CAFTA-DR, rather 
because it is necessary for the economic transformation of 
Honduras, to ensure that the benefits of economic growth are 
shared by all.  "The treaty is not important", he concluded, 
"what is important is our conduct and our commitment, with 
or without CAFTA." 
 
6.  At the event in San Pedro Sula the following day, 
EconChief represented the embassy, and Minister Leitzelar 
was not present, leaving significant time for audience 
participation.  The question and answer session was 
generally polite, but exposed a number of private sector 
concerns.  Many questions were technical in nature, and were 
fielded by Urtecho of COHEP.  In addition, audience members 
inquired about the "fines" that could be imposed, in 
response to which EconChief stressed the numerous other 
options for settlement of a dispute, the fact that any 
compensation levied would be as a last resort, and the fact 
that all funds would be directed to programs within the 
country to address the enforcement problem.  EconChief also 
highlighted that the U.S. interest is in promoting regional 
integration, supporting stable, prosperous neighbors, and 
improving the enforcement of labor laws, not in somehow 
"punishing" its neighbors. 
 
7.  Asked how a developing country could afford to enforce 
"these new laws", EconChief reiterated that CAFTA-DR imposes 
no new laws, but only the requirement that Honduras enforce 
its own laws.  These are standards that Honduras has already 
decided are important and therefore passed into law - now it 
is up to Honduras to adequately enforce them.  That said, 
the USG has historically been eager to support such efforts 
in our partners, and can likely be counted on to continue 
doing so under CAFTA-DR.  Again, EconChief noted, the goal 
is to improve how the system works, not to point fingers. 
In one of the best exchanges of the morning, one audience 
member asked how CAFTA-DR would prevent corruption from 
undermining the system.  Urtecho turned it back on the 
audience, in effect asking them how they will fight 
corruption.  As he listed the symptoms and societal costs of 
corruption, and called the business community to action in 
doing its part to combat corruption, heads throughout the 
audience were nodding in assent.  Following the event 
EconChief was approached by audience members, and 
interviewed by several reporters, providing an additional 
opportunity to set the facts straight and to promote CAFTA- 
DR as a strongly positive step for the region. 
 
8.  Comment: Nearly ten months after Honduras' part in the 
CAFTA-DR negotiations concluded, the level of knowledge 
among the business community, not to mention the general 
public, regarding the agreement remains very low.  (EconOff 
was interviewed by one television journalist who apparently 
did not realize that CAFTA-DR is distinct from the FTAA.) 
For many of those in attendance, the event was obviously the 
first time they had received a clear description of the way 
that the agreement sets out to protect and enforce 
fundamental labor rights.  Further outreach of this nature, 
including future events aimed at workers and unions, will be 
of great value in counteracting widespread misinformation 
and building public support for CAFTA-DR, as the GOH 
prepares for ratification.  End comment. 
 
Pierce