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Viewing cable 06LIMA3385, TRADE ENVOY DE SOTO DISCUSSES PTPA STRATEGY

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Reference ID Created Released Classification Origin
06LIMA3385 2006-08-25 15:29 2011-08-25 00:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Lima
VZCZCXYZ0037
RR RUEHWEB

DE RUEHPE #3385/01 2371529
ZNR UUUUU ZZH
R 251529Z AUG 06
FM AMEMBASSY LIMA
TO RUEHC/SECSTATE WASHDC 2014
INFO RUEHBO/AMEMBASSY BOGOTA 3814
RUEHBU/AMEMBASSY BUENOS AIRES 2556
RUEHCV/AMEMBASSY CARACAS 9738
RUEHQT/AMEMBASSY QUITO 0636
RUEHLP/AMEMBASSY LA PAZ AUG SANTIAGO 0808
RUEHGV/USMISSION GENEVA 0463
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHDC
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC
UNCLAS LIMA 003385 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR WHA/AND, WHA/EPSC, EB/OMA, EB/TPP 
COMMERCE FOR 4331/MAC/WH/MCAMERON 
USTR FOR EEISSENSTAT AND BHARMAN 
GENEVA FOR USTR 
 
E.O. 12958: N/A 
TAGS: ETRD ECON EINV PGOV PREL PE
SUBJECT: TRADE ENVOY DE SOTO DISCUSSES PTPA STRATEGY 
 
REF: LIMA 3316 AND PREVIOUS 
 
1. (SBU) Summary:  Hernando de Soto, President Garcia's recently 
named Personal Representative for the U.S.-Peru Trade Promotion 
Agreement (PTPA), told the Ambassador on August 22 that he would 
develop a plan of activities to promote U.S. Congressional passage 
of the PTPA before traveling to the U.S. for a few weeks o/a 
September 10.  He stressed the need to develop a fallback position 
in case the U.S. Congress voted against the agreement, and asked 
what the prospects would be for ATPDEA extension in that case.  The 
Ambassador replied that a negative vote would make ATPDEA extension 
hopeless, so the GOP should put all its eggs in the approval basket. 
 De Soto said he would coordinate his strategy closely with GOP 
ministries, the previous Toledo administration's trade team, and USG 
officials to ensure maximum effectiveness.  The Ambassador advised 
De Soto to establish regular contact with USTR and its legislative 
affairs office.  De Soto will meet with A/USTR Everett Eissenstat 
during his August 30-September 1 visit to Lima, and with House Ways 
and Means Committee staff member Angela Ellard on August 24.  End 
Summary. 
 
2. (SBU) Ambassador met with Hernando de Soto, President Garcia's 
personal representative for the U.S.-Peru Trade Promotion Agreement 
(PTPA), on August 22 to discuss De Soto's plans for taking up his 
new responsibilities (see REFTEL).  De Soto said that President 
Garcia had taken it for granted that President Toledo would nail 
down U.S. ratification of the PTPA before Toledo left office, and 
had absolutely no contingency plan for lobbying Washington.  De Soto 
plans to devote himself between now and September 10 to "drawing a 
map" of activities he will undertake to promote U.S. Congressional 
passage of the PTPA. 
 
3. (SBU) De Soto knew that President Toledo had innocently put 
himself in the middle of a U.S. partisan dispute on labor standards 
in FTAs, and said he would work to avoid such missteps.  He said he 
would welcome pointers from U.S. officials.  The Ambassador said 
that the most important piece of advice he could offer was that De 
Soto should coordinate as closely as possible with USTR and its 
legislative affairs people.  De Soto plans to consult with GOP 
ministries, the previous Toledo administration's team and USG 
officials so that he can pick up where the outgoing government left 
off and "avoid traps along the way."  Given the suddenness of his 
appointment, De Soto has not even had a chance to be briefed by key 
people like former Ambassador to Washington Eduardo Ferrero. 
 
4. (SBU) De Soto said that he planned to moderate the GOP's public 
statements of confidence about PTPA approval by the U.S. Congress. 
Both former President Toledo and Ambassador Ferrero had publicly 
said that everything was set up and the new government only needed 
to give a little push to win approval.  De Soto knows there are a 
lot of uncertainties on timing and that nothing should be taken for 
granted.  The Ambassador said he would be careful not to contradict 
De Soto, but suggested De Soto avoid being too pessimistic lest it 
feed back in an unhelpful way to the U.S.  De Soto was concerned 
about developing a fallback position in case the U.S. Congress votes 
down the PTPA, and asked what the prospects would be for ATPDEA 
extension if that happened.  The Ambassador told De Soto he should 
assume that a negative vote would also mean ATPDEA extension would 
be hopeless.  The Ambassador recommended that since Peru only gets 
one shot at this in the U.S. Congress, the GOP should put all its 
eggs in the approval basket. 
 
5. (SBU) De Soto plans to send staff ahead to Washington to prepare 
the ground, including Ambassador Jorge Valdez, on loan from the MFA 
as the Director of International Affairs at De Soto's Institute for 
Liberty and Democracy (ILD), and ILD Finance Director Alfonso 
Grados.  De Soto also hopes to recruit former Trade Vice Minister 
and PTPA negotiator Pablo de la Flor, who he noted came out of ILD. 
(Note:  De la Flor, who is well-known to Washington trade officials, 
told Ambassador later in the day that he would like to help De Soto 
but doesn't know if he can because he just accepted a job with Booz 
Allen Hamilton.  End Note.)  De Soto has previously planned 
commitments in Washington on September 10 (to review ILD initiatives 
with a couple of U.S. senators) and in New York from September 20-22 
(to participate in the Clinton Global Initiative).  He plans on 
spending the weeks in between in the U.S., working the Congress and 
others. 
 
6. (SBU) De Soto had seen materials from one of the U.S. lobbying 
firms contracted by the GOP and said it looked liked they knew what 
they were doing.  The Ambassador said that he had heard from 
Washington contacts that Peru's team was pretty good, and noted that 
with so much turnover in Peru's Trade Ministry and Washington 
Embassy, De Soto would probably find it useful to have some 
continuity.  De Soto agreed.  De Soto will meet with A/USTR Everett 
Eissenstat during his August 30-September 1 visit to Lima.  He will 
also see Ways and Means staffer Angela Ellard, who is on vacation in 
Peru, on August 24. 
 
7. (SBU) When asked why he took on this new challenge, De Soto told 
the Ambassador that he had conversed with President Garcia a number 
of times before the election about his "TLC adentro" ("internal 
FTA") ideas--proposals to allow more businesses and producers to 
participate in international commerce (see REFTEL and 
http://www.ild.org.pe/pdf/TLC_Interno-Peru.pd f).  Garcia's offer of 
the special envoy position caught De Soto by surprise and was 
hastily finalized.  Garcia had offered De Soto other GOP positions, 
but De Soto said he turned them down because he had spent years 
building his and ILD's reputation and influence, and it was 
important that he spend that capital carefully.  He did not want to 
have an appointment that would identify him too broadly with the 
government, pulling ILD into issues outside of its range.  The big 
draw of this position for De Soto is that the inward-focused, 
"internal FTA" element matches the reform agenda that ILD promotes 
globally.  De Soto already has some initiatives lined up for his 
"internal FTA" plan, and plans to start rolling them out in 
September. 
 
STRUBLE