Viewing cable 08SANSALVADOR185
Title: WTO DEMARCHE - U.S./EC TAFT GOODS PROPOSAL

IdentifierCreatedReleasedClassificationOrigin
08SANSALVADOR1852008-02-15 14:23:00 2011-08-30 01:44:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy San Salvador
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PP RUEHAG RUEHAP RUEHDE RUEHDF RUEHGI RUEHHM RUEHLZ RUEHMA RUEHMR
RUEHPA RUEHPB RUEHRN
DE RUEHSN #0185/01 0461423
ZNR UUUUU ZZH
P 151423Z FEB 08
FM AMEMBASSY SAN SALVADOR
TO RUEHC/SECSTATE WASHDC PRIORITY 9011
INFO RUCNWTO/WORLD TRADE ORGANIZATION COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHBS/USEU BRUSSELS
UNCLAS SECTION 01 OF 02 SAN SALVADOR 000185 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR EEB ASCHEIBE 
DEPT PLEASE PASS USTR BNORTON & JWEISS 
COMMERCE FOR EBRZYTWA 
 
E.O. 12958: N/A 
TAGS: ETRD ECON WTRO ES
SUBJECT: WTO DEMARCHE - U.S./EC TAFT GOODS PROPOSAL 
 
REF: SECSTATE 12905 
 
¶1. (U) SUMMARY. Deputy Econ Counselor and European Union Head 
of Mission Wouter Wilton jointly delivered reftel demarche to 
Francisco Lima, El Salvador's Ambassador to the WTO, on 
February 13.  Lima was accompanied by staff from the Ministry 
of Economy's CAFTA-DR office.  Lima also raised El Salvador's 
concerns about small, vulnerable economy (SVE) provisions, 
the erosion of preferences, and the preservation of bilateral 
gains in a multilateral context.  END SUMMARY. 
 
DEMARCHE DELIVERED 
------------------ 
 
¶2. (SBU) Lima said that El Salvador is always very supportive 
of initiatives like the textile, apparel, footwear, and 
travel goods (TAFT) proposal, which are in accordance with El 
Salvador's internal standards and involve textile items that 
are very important for El Salvador.  He emphasized that the 
TAFT proposal needs to facilitate the flow of goods, not 
create additional requirements.  Some parts of the current 
proposal appear to create additional requirements and/or are 
difficult to see how they facilitate trade.  Lima thought 
that these will be addressed in due time in Geneva; if they 
are clarified, El Salvador could then be in a position to 
co-sponsor the proposal.  Lima also stressed that El Salvador 
views the TAFT proposal as a part of the broader 
non-agricultural market access (NAMA) negotiations and it 
needs to be considered in that context. 
 
ES: STUCK BETWEEN BILATERAL AND MULTILATERAL DEMANDS 
--------------------------------------------- ------- 
 
¶3. (SBU) Beyond the TAFT proposal, Lima asked for two broader 
points to be conveyed to Washington and Brussels.  First, 
Lima said that El Salvador was very grateful for US/EU 
support for small, vulnerable economies (SVEs), since the 
provisions for SVEs are what allows El Salvador to contribute 
in multilateral negotiations.  He thought progress had been 
made for SVEs on the agricultural side but more needs to be 
done on NAMA, especially "with the numbers."  El Salvador 
views bilateral and multilateral negotiations as two 
different worlds -- El Salvador is "on offense" in bilateral 
negotiations but "on defense" in multilateral.  In bilateral 
agreements, El Salvador benefits from contingent rules, time 
tables, and phase-ins for opening its market, and El Salvador 
wants to preserve its bilateral achievements and move at its 
own pace.  Lima cited El Salvador's poultry sector, which has 
been difficult to open even under CAFTA-DR, as one that would 
be extremely difficult to open in a multilateral context. 
 
¶4. (SBU) Second, Lima emphasized El Salvador's concerns about 
erosion of preferences.  Some NAMA proposals list specific 
products, like textile/apparel and fish products, for special 
and differential treatment.  These are precisely El 
Salvador's export profile under CAFTA and the proposed 
EU-Central American association agreement, and El Salvador 
wants to preserve its FTA benefits.  Lima also specifically 
referenced strict rules of origin and the Hong Kong 
Declaration, since El Salvador is dependent on certain 
unilateral preferences on rules of origin.  This is a major 
concern for El Salvador, he noted, and they have not seen 
much support from the US or EU. 
 
¶5. (SBU) Lima stated that El Salvador understood it was not 
the "goal" for the US or EU in WTO negotiations, but "we are 
in the middle."  He noted that "small issues" may not be the 
breaking point for the US or EU, but they are for El 
Salvador.  El Salvador will continue to "work constructively" 
but its concerns need to be addressed.  If El Salvador has 
US/EU support and its interests are properly covered, it 
doesn't need to "raise its voice," but if it doesn't, El 
Salvador will speak out "so you're aware." 
 
COMMENT 
------- 
 
¶6. (SBU) The meeting with Lima confirms Post's sense -- 
shared by the EU -- that the primary responsibility for El 
Salvador's WTO policy has been delegated to him in Geneva. In 
addition to CAFTA-DR, which El Salvador still considers its 
most important trading agreement, two other bilateral 
agreements may affect El Salvador's WTO negotiating position 
going forward.  The first is the Central American-European 
Union Association Agreement, which starts its second round at 
the end of February in Brussels.  The second is a possible 
 
SAN SALVAD 00000185  002 OF 002 
 
 
Brazil-El Salvador FTA, which is rumored to be in very early 
stages of negotiation. 
GLAZER