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Cablegate: Turbulent Relations Between Nicaraguan Government And

VZCZCXYZ0000
RR RUEHWEB

DE RUEHMU #1073/01 3101931
ZNY CCCCC ZZH
R 061931Z NOV 09
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC 0102
INFO WHA CENTRAL AMERICAN COLLECTIVE
RHEFHTA/TSA HQ WASHINGTON DC
RHMFISS/FAA NATIONAL HQ WASHINGTON DC

C O N F I D E N T I A L MANAGUA 001073

SIPDIS

E.O. 12958: DECL: 2019/11/06
TAGS: EAIR EINV ETRD PGOV NU
SUBJECT: TURBULENT RELATIONS BETWEEN NICARAGUAN GOVERNMENT AND
AIRLINES

REF: MANAGUA 1034; MANAGUA 711; 08 MANAGUA 1448

CLASSIFIED BY: Robert J. Callahan, Ambassador, Department of State;
REASON: 1.4(B), (D)

SUMMARY

-------

1. (C) Relations between commercial air carriers that serve
U.S./Nicaragua routes and the GON's airport authority are
worsening. On November 3 a representative of Continental Airlines
told econoff that the situation at Managua's Augusto C. Sandino
International Airport is becoming "unbearable." We heard similar
comments from American, Spirit, UPS and TACA airlines during
October's Civil Aviation Roundtable, hosted by the Economic
Section. According to these airlines, the GON has increasingly
consolidated airport services under its aviation authority (EAAI),
now firmly in the hands of Sandinista National Liberation Front
(FSLN) loyalists close to President Daniel Ortega. Post access to
the airport remains highly restricted since 2008 (Ref C). Airline
representatives also described how the EAAI has refused to allow
them to conduct audits of ground services, which could result in
negative safety and security implications. The upcoming
Transportation Security Administration (TSA) inspection of the
Augusto C. Sandino Airport, scheduled for December, will provide
the airlines an opportunity to air their grievances. Despite these
ongoing difficulties, airlines report full flights, with especially
large numbers of missionary groups and surfers.

GON'S AIRPORT AUTHORITY MISMANAGED, INEPT, AND POLITICIZED

--------------------------------------------- -------------

2. (C) On November 3, Ivan Cortes, Regional Manager for Continental
Airlines, told econoff that managing the relationship with EAAI
(the Nicaraguan airport authority) is making his job "unbearable,"
and he believes the relationship will continue to worsen. In
October, representatives of Continental, American, UPS, Spirit and
TACA airlines told emboffs during the quarterly Civil Aviation
Roundtable that EAAI is no longer cooperative--or transparent--in
its relations with them. They reported that the GON has
increasingly consolidated management of the airport administration
and security under EAAI, directed by Orlando Castillo, an FSLN
loyalist of President Daniel Ortega. (Comment: Orlando Castillo's
father, Orlando Castillo Sr., serves as the Executive Director of
Nicaragua's telecommunications regulator, TELCOR, which recently
awarded new telecommunications bandwidth to a Russian-Nicaraguan
joint venture on dubious grounds. See Ref A. End comment.)
According to airline representatives, EAAI is now fully-staffed by
FSLN loyalists who possess little or no knowledge of airport
management. Moreover, according to the participants at the
roundtable, the EAAI is intent on exercising its power in an
increasingly autocratic manner.

3. (C) Airline representatives told emboffs that keeping their
planes on schedule as they negotiate logistical issues with the
EAAI is a daily challenge. The American Airlines representative
described how it often requires six attempts to elicit a response
from EAAI, if one is received at all. Participants also said that
EAAI is not investing in needed upgrades for airport operations.
The American Airlines representative, for example, described how
her firm had recently imported two specialized cargo loading
vehicles, 15 dollies, and four small tractors as a result of EAAI's
inability to provide sufficient ground-handling equipment.

AUDITS REFUSED

--------------

4. (C) On May 21, 2009, the Nicaraguan civil aviation authority
(INAC) abruptly expelled the airport's ground-handling contractor
(GHANSA) from its offices (Ref B). Following GHANSA's dismissal,
EAAI directly assumed management of ground-handling operations.
Airline representatives told emboffs that since then, their
requests to audit ground services have not been authorized by EAAI,
including security, baggage services, aircraft fueling, and
aircraft cleaning services. The inability of the airlines to audit
these services negatively affects their safety record and
competitiveness. Ivan Cortes of Continental told econoff that
these audits are the industry standard; without them, the airlines
are unable to ascertain whether or not they are receiving the
services for which they are paying. UPS said they conducted a
successful audit in April of 2009, but since then, EAAI management
has prevented them from assessing ground/ramp related services.
More troubling, EAAI has stopped providing airlines with access to
training certificates (for example, x-ray training) that airport
security personnel should have on file. Airline representatives
also expressed concern over long shifts worked by Nicaraguan Army
soldiers who provide airport security, in some cases more than 20
hours.

EMBASSY AIRPORT ACCESS REMAINS RESTRICTED

-----------------------------------------

5. (C) EAAI has not relaxed its restrictions on Post's access to
the airport, implemented in 2008 (Ref C). We are now limited to
day-passes exclusively for classified diplomatic pouch runs, and
only with 48-hour written advanced notice. Recently, in October
2009, EAAI denied Post access to the tarmac to deliver the
classified diplomatic pouch directly to the airplane. Post has yet
to receive its first bill for this service, now provided by EAAI.

PASSENGER NUMBERS STEADY

------------------------

6. (C) Despite the aforementioned problems, airlines that serve
routes between the United States and Nicaragua continue to report
full flights, with especially large numbers of missionary groups
and surfers continuing to visit. Airline representatives said that
they have increased ticket sales by lowering prices. They are
using smaller planes to keep their operations profitable. In
August 2008, approximately 44,000 passengers entered Nicaragua
through Augusto Sandino International Airport. In comparison,
42,000 entered in August 2009. In August 2008, approximately
52,000 passengers departed Nicaragua. In comparison, 49,000
departed in August 2009. While the 2009 figures represent a slight
decrease, they fall within the historic range over the previous
four years.

COMMENT

-------

7. (C) The deterioration in the relationship between the airlines
and EAAI reflects an ongoing phenomenon, that is, government
agencies staffed with FSLN loyalists who have little or no
expertise related to their new responsibilities. The upcoming
December 9-16 Transportation Security Administration (TSA)
inspection of Sandino Airport thus comes at an ideal time to assess
EAAI's ability to maintain security. The team's access, however,
may be limited as our relationship with EAAI devolves into a
pattern of interaction similar to that with the respective airport
authorities in Venezuela and Bolivia.
SANDERS

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