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Cablegate: Opposition, Others Defend Us Aid

VZCZCXRO4952
PP RUEHLMC
DE RUEHLP #2400/01 2422118
ZNY CCCCC ZZH
P 302118Z AUG 07
FM AMEMBASSY LA PAZ
TO RUEHC/SECSTATE WASHDC PRIORITY 4852
INFO RUEHAC/AMEMBASSY ASUNCION 7042
RUEHBO/AMEMBASSY BOGOTA 4410
RUEHBR/AMEMBASSY BRASILIA 8303
RUEHBU/AMEMBASSY BUENOS AIRES 5534
RUEHCV/AMEMBASSY CARACAS 2761
RUEHGE/AMEMBASSY GEORGETOWN 0399
RUEHPE/AMEMBASSY LIMA 2942
RUEHMN/AMEMBASSY MONTEVIDEO 4823
RUEHPO/AMEMBASSY PARAMARIBO 0097
RUEHQT/AMEMBASSY QUITO 5395
RUEHSG/AMEMBASSY SANTIAGO 0003
RUEHKO/AMEMBASSY TOKYO 0326
RUEHLMC/MILLENNIUM CHALLENGE CORP
RUEHC/DEPT OF LABOR WASHINGTON DC
RUEHUB/USINT HAVANA 0509
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RHMFISS/HQ USSOUTHCOM MIAMI FL
RUEHBS/USEU BRUSSELS
RUMIAAA/USCINCSO MIAMI FL
RHEHNSC/NSC WASHINGTON DC

C O N F I D E N T I A L SECTION 01 OF 03 LA PAZ 002400

SIPDIS

SIPDIS

E.O. 12958: DECL: 08/30/2017
TAGS: ECON PGOV PREL PHUM EAID BL
SUBJECT: OPPOSITION, OTHERS DEFEND US AID

REF: A. LA PAZ 2387
B. LA PAZ 2386

Classified By: A/DCM Mike Hammer for reasons 1.4 (b) and (d).

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Summary
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1. (U) Following Minister of the Presidency Quintana's August
29 attacks on USAID in which he accused the USG of supporting
the opposition and told USAID to get in line with government
policies or leave the country, the opposition, NGOs and
pundits are defending USAID and criticizing the government
for the unwarranted attack. The official State Department
response to the Bolivian government's accusations has
received wide coverage, and many editorials are suggesting
that the MAS attack on USAID is a smokescreen to cover recent
domestic problems including civic strikes, rising inflation
and Venezuelan cash assistance.

- - - - - - -
Blowing Smoke
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2. (U) Many political commentators and opposition
politicians have drawn attention to the timing of Minister
Quintana's diatribe, coming as it did only a day after six of
Bolivia's nine departments shut down in strikes against the
ruling MAS government. The head of the opposition party
National Unity (UN) Samuel Doria Medina said, "It's an old
method of (Hugo) Chavez. Every time he has a domestic
problem, he insults the U.S. government and fights with them.
It's no coincidence that on Tuesday there was a massive
strike against the government of Evo Morales, and that now
Quintana comes out to tell lies and hoaxes." In the words of
Carlos Hugo Molina, one of the former government officials
(under Goni Sanchez de Lozada) listed by Quintana as evidence
that USAID is financing the "old way" and the opposition:
"They are trying to scare us...this should be denounced at
international levels." Another USAID contractor, Juan Carlos
Urenda (a Santa Cruz civic leader) described the MAS
accusations as an attempt to cast a smokescreen over the
"serious problems in this country," and opined that this was
"another mistake of the government that will do no less than
deepen the differences and confrontations in the country."

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Pay No Attention to the Venezuelan Behind the Curtain
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3. (C) On August 29, as Minister Quintana criticized USAID's
"flagrant interference in Bolivian politics", President
Morales was handing out Venezuelan checks to mayors in the
department of La Paz. In the past, President Morales has
publicly called for European, Japanese and U.S. aid to be
more like Venezuelan aid, which in practice would mean almost
no accountability or transparency. In his attack on USAID,
Minister Quintana praised European aid for being transparent
and for following Bolivian laws. Although Quintana did not
directly mention Venezuelan aid, the MAS is clearly
responding to criticism of the increasing Venezuelan
influence in the country. The official government news
source ABI on August 30 ran an article describing how
President Morales has been handing out "cooperation checks"
from Venezuela and Europe. This attempted conflation of
Venezuelan and European aid seems to be a MAS attempt to both
isolate the United States and justify its acceptance of
increasing Venezuelan involvement in the country. Following
Quintana's presentation, Vice President Garcia Linera
announced that the Bolivian government will push for a new
law to control the destination of international aid and will

LA PAZ 00002400 002 OF 003


investigate the programs of all international aid in Bolivia.


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Biting the Hand that Continues to Feed You
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4. (U) Many Bolivians are concerned about the more immediate
and concrete impact that could result from poking a stick at
the United States. The Bolivian External Trade Institute
(IBCE) is concerned for the future of ATPDEA, pointing out
that Bolivia is even now preparing a proposal for the
extension of ATPDEA trade preferences. IBCE head Gary
Rodriguez stated, "We understand that the (Bolivian)
Government doesn't need trade preferences, but the workers do
need them, as do entrepreneurs who seek to consolidate and
not lose free access for their exports."

5. (C) More directly, many observers are pointing out that
Bolivia cannot afford to risk USD120 million in assistance
from USAID. Few are suggesting that all USAID assistance
could be lost, but concerns are rife that funding could be
reduced in the future. While Morales and the MAS may be
willing to wave goodbye to our assistance, other officials
either doubt that Venezuela will step up to completely fill
the gap or, pragmatically, see a benefit in receiving as much
aid as possible from various sources. (Comment: At a time
when Vice President Linera is heading to Washington to, among
other issues, push for Millennium Challenge aid to Bolivia
and a continuation of ATPDEA trade benefits, the timing of
the attacks against the USG seems self-defeating. End
comment.)

- - - - - - - - - - - - - -
Next Target: NAS Assistance
- - - - - - - - - - - - - -

6. (C) Minister Quintana also announced his "suspicions of
U.S. double morality" in the fight against drugs, questioning
the U.S. focus on cocaine in Bolivia while claiming that
marijuana is not part of counternarcotics programs here.
Quintana said that the Bolivian government is investigating
NAS assistance and will publish their findings in the
following weeks. (Comment: It is understandable that a
government whose president is also the head of the
coca-growers union would turn its sights on NAS's programs.
Considering the egregious accusations that the Bolivian
government has just leveled at USAID, we expect that their
'investigation' of NAS will be equally rigorous. End
comment.)


- - - -
Comment
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7. (C) In the wake of Quintana's press conference, USAID has
received an outpouring of support. Many partner NGOs are
publicly challenging the government's accusations, and some
have requested more information from USAID in order to
repudiate the MAS stance. Morale in USAID could take a hit,
particularly among the Bolivian locally-engaged staff, some
of whom fear that after Quintana's threats and insinuations
about 'traitors' who 'sell out their country', they may be
targeted by the MAS in the future. Their fears are not
unfounded, considering that Quintana named USAID contractors,
listed their posts in previous governments, and accused them
of working against the MAS program of change. To address
initial concerns and assure employees of USG support, USAID
held an all-hands staff meeting right after Quintana's press
briefing. The Ambassador will hold a mission wide townhall
meeting immediately upon his return to La Paz.

LA PAZ 00002400 003 OF 003


URS

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