US embassy cable - 03GUATEMALA1435

C O N F I D E N T I A L SECTION 01 OF 04 GUATEMALA 001435 
 
SIPDIS 
 
HARARE FOR BRUCE WHARTON 
USTR FOR BUD CLATANOFF 
USDOL FOR ILAB: JORGE PEREZ-LOPEZ AND ROBERT WHOLEY 
 
E.O. 12958: DECL: 05/29/2013 
TAGS: PGOV, PREL, PHUM, ELAB, ETRD, CASC, GT 
SUBJECT: ASSISTANT SECRETARY STRUBLE'S MAY 29-31 VISIT TO 
GUATEMALA 
 
Classified By: Political Counselor David Lindwall. Reason 1.5 (b&d). 
 
1.  (C) Summary:  During a May 29-31 visit to Guatemala, to 
participate in a WHA Entry Level Conference, Acting Assistant 
Secretary Curt Struble met with Vice President Reyes Lopez, 
 
SIPDIS 
Acting Foreign Minister Aguilera and Minister of Interior 
Reyes Calderon to discuss the full range of bilateral issues. 
 Vice President Reyes reiterated the Portillo 
Administration's desire to complete free trade negotiations 
with us by November, 2003, and said that the GOG would 
conclude a maritime counternarcotics agreement with the U.S. 
during the first week of June.  In a call on human rights 
leader Helen Mack, AA/S Struble expressed USG support for 
Mack's efforts to obtain justice in the case of her sister, 
who was murdered by security forces in 1990, and the creation 
of an international mission to investigate the actions of 
clandestine forces that have threatened human rights workers 
in recent years.  AA/S Struble and the Ambassador secured 
assurances from Attorney General de Leon that greater 
attention would be given to the investigation of the murders 
of American Citizens and labor union members.  De Leon also 
described the ongoing investigation of a major corruption 
case at the Social Security Institute that could implicate 
important political sectors.  Press attention during the 
visit focused on USG concerns over a possible Rios Montt 
presidency and satisfaction with improvements in 
counternarcotics cooperation.  The visit brought attention 
both publicly and privately to the need for concrete actions 
to advance critical issues on the bilateral agenda in the 
remaining eight months of the Portillo Administration.  End 
Summary. 
 
Vice President Anxious to Conclude Free Trade Negotiations 
----------------------- 
 
2. (C) Vice President Francisco Reyes Lopez, accompanied by 
Acting Foreign Minister Gabriel Aguilera and Minister of 
Interior Reyes Calderon, hosted a lunch at the Presidential 
Palace for AA/S Struble, the Ambassador and PolCouns 
(notetaker) on May 30.  Reyes said that the Portillo 
Administration is firmly committed to completing a free trade 
agreement with the United States (CAFTA), and would like to 
conclude the negotiation as soon as possible.  Reyes noted 
that President Portillo will be handing over power to a new 
president in January 2004, and that by November 30, 2003, 
Congress will out of session.  He said the GOG is prepared to 
increase the pace of negotiations in order to complete them 
by the end of October, 2003, giving the Guatemalan Congress a 
month to ratify the agreement.  Reyes fears that if an 
agreement is not concluded by then, it will be difficult to 
get the current Congress to approve it, and the next Congress 
is expected to be much more fractured than the current one. 
 
3. (C) AA/S Struble and the Ambassador praised the Guatemalan 
negotiating team, and said that Guatemala's positions at the 
most recent round of talks had moved the negotiation 
significantly forward.  The Vice President agreed, but said 
that the GOG still has some concerns over potential losses to 
its agricultural sector.  He described how, during a visit to 
Iowa, he was amazed at the US potential for producing corn. 
He said Guatemala could never compete against the US in corn 
production, yet 50% of Guatemalans are corn farmers.  Lopez 
argued that an agreement that did not take into consideration 
Guatemala's particular agricultural needs would only lead to 
increased rural poverty and more immigration to the United 
States.  AA/S Struble commented that during the April 10 
meeting between President Bush and the Central American 
presidents, President Bush said emphatically that the US does 
not want an agreement that disfavors Central America.  USG 
policy is to negotiate an agreement that is beneficial to 
both sides.  Struble also noted AID's efforts to coordinate 
its development assistance strategy to the needs of CAFTA, 
but he warned that inefficient producers are going to come 
under pressure with or without CAFTA. 
 
4. (C) The Ambassador told the Guatemalans that the USG was 
pleased with the increase in counternarcotics cooperation in 
recent months.  He noted that we are close to signing a 
maritime counternarcotics cooperation agreement, and 
expressed hope that the GOG would ratify this agreement in 
the coming days.  Acting Foreign Minister Aguilera said that 
the MFA expects to have an agreed text ready to send to 
Congress for ratification by June 4 (Note: In Guatemala, 
Congressional ratification of international agreements 
precedes signature by the President. End note).  Vice 
President Reyes said that much has been done, but 
acknowledged that much remains to be done to deny the use of 
Guatemala to the traffickers as a transit point for drugs 
heading north.  He made a pitch for greater USG financial 
assistance to the counter-drug effort in Guatemala.  The 
Ambassador commented that recently passed asset forfeiture 
legislation, if properly applied, would generate far more 
resources for the law enforcement purposes than the U.S. 
would ever be able to provide.  He urged the Guatemalans to 
begin implementing this law and to use the proceeds 
effectively to fight drugs. 
 
5. (C) On other matters, AA/S Struble expressed concern for 
the slow movement by GOG authorities to investigate the 
murders of 13 AmCits in the past three years, and called on 
the Vice President to use the Executive's influence with the 
Attorney General and the Courts to give serious attention to 
these cases.  He noted that the USG is also concerned about 
the recent murders of several labor leaders and the lack of 
effective investigation of their cases.  AA/S Struble told 
Vice President Reyes that labor rights are a fundamental 
concern of the U.S. in Guatemala, and that the potential GSP 
review and ongoing CAFTA negotiations brought more attention 
to Guatemala's labor situation.  Vice President Reyes 
acknowledged that more needs to be done to protect labor 
rights, and went on to list the Portillo Government's 
accomplishments in this field (e.g. passage of a new labor 
code, increases in the minimum wage, lowering of requirements 
for establishing new unions, etc.). 
 
Helen Mack Describes Long Road Ahead for Human Rights 
----------------- 
 
6. (C) Accompanied by Ambassador and PolOffs, AA/S Struble 
visited the Myrna Mack Foundation to discuss with Foundation 
Director Helen Mack recent developments in the Myrna Mack 
case, progress in establishing the proposed commission to 
investigate clandestine groups (CICIACS) and widespread 
concerns about the failure of the justice system and 
continuing impunity.  Mack thanked AA/S Struble for his visit 
and the sustained USG public support, both from Washington 
and the Embassy.  Mack said that she was disappointed by the 
recent reversal of the October 2002 conviction that she and 
her legal team had won against the alleged intellectual 
authors of her sister's murder.  She also explained the 
appeal process before the Supreme Court, which she filed on 
May 28, in which she asked the court to uphold the earlier 
conviction of retired Colonel Valencia Osorio and his former 
EMP (Presidential Military Guard) supervisor, retired General 
Godoy Gaitan.  Mack anticipates that no decision will be made 
on her appeal until after the November 2003 elections and the 
installation of a new government in January of 2004.  AA/S 
Struble expressed USG disappointment in the recent setback in 
the Mack case, and the hope that the Guatemalan judicial 
system would soon find the intellectual authors responsible 
for the crime. 
 
7. (C) In regard to CICIACS, Mack opined that the most 
important effect the CICIACS could have would be to expose 
publicly the existence of the organized criminal structures 
that are undermining the rule of law in Guatemala, and 
beginning to remove those structures from the positions of 
power they currently enjoy, thanks to their connections in 
the government.  She thanked AA/S Struble for the commitment 
of USG financial and political support for this endeavor. 
 
8. (C) Mack said that she did not have high expectations that 
the recent Consultative Group Meeting would spur the 
government of President Alfonso Portillo to make significant 
progress in implementing remaining elements of the peace 
accords during its final eight months in office.  She opined 
that little improvement would be made in administration of 
justice in Guatemala unless the international financial 
institutions conditioned their loans on concrete improvement 
in the administration of justice.  Mack does not believe 
sufficient incentives are currently in place to bring about 
improvements in administration of justice, and that the only 
tool that is likely to have sufficient leverage is 
conditionality on IFI loans.  She expressed thanks for the 
support of the international community which used the 
Consultative Group Meeting to press the GOG for concrete 
reforms, but said that unless Guatemalans overcome their 
apathy and begin to take ownership of resolving these 
problems themselves, this government and future governments 
would have little incentive to respond. 
 
9. (C) Following the meeting, AA/S Struble spoke with 
reporters and reaffirmed the priority the USG attaches to the 
promotion and defense of human rights in Guatemala.  Calling 
Helen "a national treasure," Struble lauded her role in 
seeking justice in human rights cases and working to end the 
impunity that has long overshadowed human rights cases in 
Guatemala. 
 
Attorney General Promises Greater Attention to AmCit and 
Labor Cases 
------------------------- 
 
 
10. (C) AA/S Struble and the Ambassador met on May 29 with 
Attorney General Carlos de Leon Argueta to congratulate the 
GOG on recent improvements in counter-narcotics cooperation 
and to encourage stronger efforts by the Public Ministry to 
investigate unsolved murders of U.S. citizens, Guatemalan 
labor leaders, and to ensure the independence of a GOG 
forensic laboratory which will receive USG funding.  He told 
de Leon that the USG, Congress and civil society are 
concerned about unsolved murders of AmCits (13 in the past 
three years) and lagging investigations of murdered labor 
leaders in Guatemala.  AA/S Struble requested that the GOG 
make further efforts to combat and prevent these crimes by 
ending the impunity enjoyed by perpetrators.  AA/S Struble 
further noted that an AFL-CIO petition to withdraw 
Guatemala's GSP trade benefits is currently under review, and 
Congressional approval of an eventual free trade agreement 
with Central America will draw increased attention to labor 
rights protections in the region.  AA/S Struble noted a 
growing recognition by some in Central America (he cited 
Salvadoran President Flores in an April 11 meeting between 
Central American presidents and President Bush) that Central 
American governments need to do a better job convincing U.S. 
NGOs and the AFL-CIO that a CAFTA will enhance protection of 
labor rights in the region.  The Ambassador went on to 
encourage de Leon to devote more resources to combat money 
laundering. 
 
11. (C) De Leon said that he was reviewing the progress of 
the special prosecutor investigating the murder of AmCits, 
and will replace him if insufficient progress is revealed. 
To combat impunity the Ministry had added 100 new 
prosecutors, including six dedicated to money laundering 
investigations.  A new Special Prosecutor for Crimes Against 
Trade Unionists and Journalists and supporting team had 
recently been appointed, and is already making progress, 
pursuing arrest warrants, judicial processes and trials. 
Some of the crimes against union leaders, for example the 
murder of the head of the municipal union of Nueva 
Concepcion, Escuintla province in November 2002, were 
motivated not by anti-union motives but by a power struggle 
within organized crime, he said.  Arrests have already been 
made in that case, which involved 16 murders.  De Leon 
expressed GOG gratitude for support from the Ambassador and 
DEA which has resulted in record seizures of drugs and cash 
in recent months.  He also cited the Ministry's efforts to 
prosecute human rights crimes, citing the successful 
prosecution of 16 former agents of the anti-narcotics police 
for abuse of authority in the Chocon case. 
 
12. (C) De Leon said he was optimistic about what the 
Ministry could accomplish over the remaining three years of 
his term.  However, although the Public Ministry had 
substantially improved its human resources since his arrival, 
it still lacked sufficient funding to provide adequate 
national coverage.  The average prosecutor must handle 1,500 
cases per year, and the Ministry budget can only afford an 
average expenditure of $130 per case.  Nevertheless, the 
Ministry had launched low-cost initiatives to extend the rule 
of law.  For example, the ministry recently ran a public 
information campaign to combat intra-family violence; 
complaints by battered women shot up 400% as a result.  De 
Leon said his other priorities include the creation of a new 
FBI-like institution within the Public Ministry and combating 
corruption.  He claimed to be resisting overtures from 
corrupt elements within the Presidential Guard (EMP) and to 
have instituted procedures to prevent the disappearance of 
seized assets.  "In this job I cannot have friends or 
enemies, I must apply the law equally to everyone," he said. 
 
13. (C) De Leon said that the current IGSS scandal (involving 
the theft of over $30 million from the Social Security 
Institute) shows that the GOG's system to detect and 
investigate money laundering works.  All the IGSS funds 
diverted to illicit and overseas accounts have been 
recovered, he said.  He gave AA/S Struble a list of the banks 
and sums of money identified (including Citibank) totaling 
$17.4 million, and said that money laundering statues 
provided the Public Ministry new powers to take measures to 
freeze illicit accounts.  The Ministry had executed over 20 
raids and seized computer records and other evidence of the 
fraud committed by IGSS officials.  The Ministry will arrest 
Carlos Wholers, an FRG Deputy and then-President of the IGSS 
board of directors (named by President Portillo), as well as 
the other members of the board of directors on May 30.  AA/S 
Struble encouraged the GOG to recoup workers' funds and 
punish those responsible. 
 
Press Questions Focus on Rios Montt Presidential Candidacy 
------------------------ 
 
14. (U) At a press roundtable attended by 20 reporters on May 
30, most questions focused on a recent statement by State 
Department Spokesman Boucher to the effect that if former 
General Efrain Rios Montt were elected President in the 
upcoming election, the United States would have a difficult 
relationship with his government.  Reporters also asked about 
the status of Guatemalan counternarcotics cooperation (and 
the possibility of Guatemala regaining certification as a 
cooperating partner in the war on drugs) and USG objectives 
in the ongoing free trade talks. AA/S Struble addressed the 
question about Rios Montt by reading the State Department's 
earlier statement and saying it speaks for itself.  On 
counternarcotics cooperation, AA/S Struble told reporters 
that there have been several concrete improvements in 
counternarcotics cooperation in recent months, and that the 
USG would evaluate this progress at the appropriate time.  In 
response to questions about CAFTA, AA/S Struble noted the 
firm commitment of President Bush to securing an agreement 
that is good for both sides.  AA/S Struble's statements 
played prominently in all the papers and radio on May 31. 
 
Comment 
------- 
15. (C) The visit of Acting Assistant Secretary Struble 
brought attention, both publicly and privately, to the need 
for the Portillo Administration to focus efforts in a number 
of concrete areas of our bilateral agenda in its remaining 
eight months in office -- namely, successful completion of 
free trade negotiations, continued progress in 
counternarcotics cooperation, effective promotion of human 
rights (including the establishment of CICIACS), and 
investigation of the murders of American citizens and labor 
union leaders.  As national elections begin to distract the 
Government and other political actors from the task of 
addressing critical areas of our bilateral agenda, the 
Embassy will press the government and Attorney General to 
keep their eye on the ball to ensure that their commitments 
result in concrete actions. 
 
16. (U) This cable was cleared by AA/S Struble prior to his 
departure from post. 
MCFARLAND