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Cablegate: Argentina: President Kirchner Cancels Trip to Bolivia,

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R 062058Z AUG 08
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INFO RUEATRS/DEPT OF TREASURY WASHINGTON DC
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TAGS: PREL AR BR VE
SUBJECT: Argentina: President Kirchner Cancels Trip to Bolivia,
Chavez Fulminates Against "Fifth Column"

Ref: BUENOS AIRES 1089

1. (U) In the face of protests in Tarija, Bolivia and reportedly at
the request of Bolivian Foreign Minister Choquehuanca, President
Cristina Fernandez de Kirchner Kirchner and visiting Venezuelan
President Hugo Chavez cancelled August 5 their planned trip to meet
with Bolivian President Evo Morales in the Bolivian departmental
capital. The abrupt change of plans led CFK to preside over her
second press conference in three days to explain the decision. In
her remarks, she emphasized a continuing commitment to support the
institutions of the Bolivian government -- and by extension,
Morales. She also underscored that the cancellation would not
affect contracted Bolivian gas sales to Argentina.

2. (SBU) President Chavez gave the Argentine press a more colorful
and lengthy explanation for the cancelled trip. He blamed the
disturbances in Tarija and other parts of Bolivia on the United
States ("el imperio" -- the empire), warning the alleged
U.S.-sponsored "fifth column" in Bolivia that they would suffer as
well for using force and violence to undermine democratic processes.
"I believe the imperialists are getting desperate," he said,
"sending fourth fleets and activating fifth columns." Chavez also
held the United States responsible for media reports of differences
among Kirchner, Chavez, and Brazilian President Lula. The Argentine
press, Chavez insisted, was filled with powerful tools of the
oligarchy, exploited by the United States (more "quinta columnas").
The United States, he said, "establishes the arguments and its
lackeys obey." Chavez's exposition included references to
President Kennedy's assassination by the "imperial establishment",
warnings about U.S. bank solvency, and swipes at the IMF over
conditionality.

3. (SBU) Shortly before leaving Buenos Aires on August 5, Chavez
confirmed that the GoV had purchased an additional US$ 1 billion in
Argentine "Boden 2015" bonds at an effective yield of between 14 and
15 percent. "We have great confidence in the Argentines," Chavez
said. This is Venezuela's second bond purchase this calendar year,
bringing total Venezuelan purchases of Argentine sovereign debt to
US$ 7.6 billion (cash value).

4. (SBU) Comment: The cancelled trip likely undermines whatever
domestic gains CFK hoped to accrue through this round of foreign
policy activism. Cancellation was evidently the right call, but it
cannot mask the profound mistake of planning to wade into Bolivian
politics arm-in-arm with Hugo Chavez. Argentina's press, meanwhile,
clearly benefited from the good copy offered by the Bolivarian
leader. End Comment.

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