US embassy cable - 05ASUNCION570

S E C R E T SECTION 01 OF 02 ASUNCION 000570 
 
SIPDIS 
 
STATE FOR WHA/BSC 
NSC FOR KIM BREIER 
SOUTHCOM FOR POLAD DAN JOHNSON 
MIAMI FOR SCINCSO//SCJ5 
 
E.O. 12958: DECL: 04/25/2025 
TAGS: PREL, PGOV, PINR, PA 
SUBJECT: PARAGUAY: EXPANDING RELATIONS WITH THE ARAB WORLD 
 
REF: TD-314/22246-05 (13 APRIL 2005) 
 
Classified By: Ambassador John F. Keane, for reasons 1.4 (b) and (d). 
 
1.  (U)  SUMMARY:  Over the course of the past year, Paraguay 
has sought to expand relations with the Arab world by seeking 
diplomatic relations with Arab nations, including plans for 
Embassies to open in Palestine and Lebanon.  It has also 
launched a series of trade and business initiatives with 
several countries in the Middle East in an effort to expand 
trade.  As current president of Mercosur, Paraguay has been 
engaged in preparatory negotiations of a declaration for the 
upcoming South American-Arab Summit.  END SUMMARY. 
 
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Increasing Diplomatic Relations 
------------------------------- 
 
2.  (C)  In the past year, Paraguay has made a strong effort 
to expand its diplomatic relations with Arab nations by 
appointing diplomatic representatives, such as an Ambassador 
to Lebanon, and seeking to open diplomatic missions abroad. 
On 6 December 2004, the GOP swore into office the first 
Paraguayan Ambassador to Lebanon, Alejandro Amed Franco, who 
will lead the GOP,s efforts to extend its diplomatic and 
commercial relations in the region.  Ambassador Franco will 
also be accredited to Syria and possibly Qatar and Oman.  MFA 
Multilateral Affairs director Julio Arriola assured PolOffs 
in October 2004 that expanding Paraguay,s ties with Lebanon 
was primarily for GOP and Mercosur interest in developing 
trade with Arab nations rather than for any overarching 
political purpose. 
 
3.  (C) In mid-March, Paraguay announced it had established 
full diplomatic relations with the Palestinian Authority 
after Foreign Minister Rachid signed the diplomatic agreement 
during her trip to Morocco.  FM Rachid and Nasser al-Kidwa, 
foreign minister of the Palestinian Authority, signed the 
agreement in Marrakech, Morocco where they were participating 
in a preparatory session for the upcoming South American-Arab 
Summit.  Rachid commented to the press at the time that the 
GOP sought to contribute to the Middle East peace process and 
to establish a political dialogue and a sustained commercial 
exchange between the two nations. 
 
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Expanding Trade with the Arab World 
----------------------------------- 
 
4.  (U)  FM Rachid and other members of the Foreign Ministry 
have stressed to EmbOffs, in meetings over the past year, an 
interest in increasing trade and business initiatives with 
Arab nations (particularly as it pertains to the Mercosur 
context, as the GOP is currently presiding over Mercosur as 
its rotating President).  In December, the GOP hosted a 
congressional delegation from Morocco that sought to 
strengthen cultural and commercial ties with Paraguay.  The 
Moroccan Ambassador to Paraguay stated to the press that his 
country had great interest in expanding its trade with 
Paraguay -- especially the importation of Paraguayan beef. 
 
5.  (C)  The GOP also has had a series of meetings with other 
Arab nations, mostly to discuss potential trade initiatives. 
When questioned last fall on GOP-Syria meetings, MFA 
Multilateral Affairs director Julio Arriola confirmed to 
PolOff that meetings between FM Rachid and Syrian 
representatives had taken place, but that the meetings were 
devoid of any political discussions and had centered on the 
GOP,s desire to develop trade relations.  In February 2005, 
Ceferino Valdez, the director of the MFA's Bilateral Affairs 
Office, told PolOff that FM Rachid had canceled a planned 
official visit to Syria and would instead only make a 
personal visit to her father,s hometown in Syria.  (Note: 
Rachid ended up canceling the portion of her trip to Lebanon 
and her father's Syrian hometown, due to political turmoil in 
Lebanon.  Instead she traveled straight to India and then to 
Morocco for the Arab Summit Preparatory session. End Note.) 
 
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A Role in the South American-Arab Summit 
---------------------------------------- 
 
6.  (U) As the current president of Mercosur, Paraguay has 
assumed a significant role in the preparations for the South 
American-Arab Summit to be held in Brasilia May 10-11.  As 
noted earlier, FM Rachid traveled to Marrakech, Morocco March 
25-26 to head up Paraguay,s delegation during the 
preparatory meetings in which the discussions centered on the 
creation of a free trade zone between Arab and South American 
nations.  Mercosur has already signed several individual 
agreements with Egypt and Morocco.  Also on the agenda for 
the May meeting is the establishment of an agreement between 
the Gulf Cooperation Council and Mercosur.  At least 20 heads 
of state have confirmed their presence at the May summit, 
including all but two South American presidents, according to 
press reports. 
 
7.  (S/NF)  During the March preparatory sessions, 
participating ministers approved a proposal for the final 
summit declaration.  According to sensitive reporting (ref 
A), a version of the draft summit declaration dated 15 
October 2004 contains 13 parts, including a section on 
bi-regional cooperation on peace and security, enhancing 
cultural cooperation, expanding international trade, and 
establishing a mechanism for economic cooperation.  The 
section on peace and security includes a comment expressing 
concern over USG unilateral sanctions imposed on Syria.  In 
addition, international press reported that economic 
ministers of both regions agreed during the March session to 
meet in Ecuador at a future date to foster the expansion of 
trade between South American and Arab nations and to discuss 
stimulating investment in strategic sectors like energy, 
transport, and telecommunications. 
 
8.  (C)  COMMENT:  Paraguay's foreign ministry has come under 
fire for not delivering economic benefits from its investment 
in relations with other states.  The GOP's overtures to the 
Arab world represent an effort to expand trade, particularly 
the export of Paraguayan beef. 
KEANE