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DE RUEHSN #0085/01 0551822
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FM AMEMBASSY SAN SALVADOR
TO RUEKJCS/OSD WASHINGTON DC
INFO RUMIESS/SOUTHCOM IESS MIAMI FL

S E C R E T SECTION 01 OF 03 SAN SALVADOR 000085

SIPDIS
OSD FOR ASD STOCKTON AND DASD MORA

E.O. 12958: DECL: 2020/02/23
TAGS: MARR DOD PREL PGOV ES
SUBJECT: Scenesetter for DoD Visit to El Salvador, March 8-9

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CLASSIFIED BY: RBlau, CDA, DOS; REASON: 1.4(D)

¶1. (C) Summary: Embassy San Salvador warmly welcomes the March 8-9
visit of Assistant Secretary of Defense Dr. Paul N. Stockton and
Deputy Assistant Secretary of Defense Dr. Frank Mora. Your visit
comes while the GOES is in the midst of combating a public security
crisis of the first order. It also comes at a time when the ESAF
has emerged as a major player in President Funes's anti-crime
strategy and his efforts to pursue a center-left, generally
pro-U.S. agenda. Your visit will help reinforce the U.S. policy of
active engagement with the GOES, which strengthens the moderate,
pragmatic elements in the current administration.



¶2. (C) Summary, continued: Recent polls show President Mauricio
Funes with an 80 percent approval rating and overwhelming public
support for a strong bilateral relationship with the U.S. Funes
has fostered strong ties with the U.S. and Brazil, though some in
the FMLN have pushed him to strengthen ties with Venezuela and Cuba
while de-emphasizing the U.S. relationship. President Funes'
non-FMLN campaign support group, the Friends of Mauricio (now the
Citizen Movement for Change), is largely in control of the economic
apparatus of the government. Similarly, Defense is in the hands of
a formerly-retired, recently-promoted military officer and Friend
of Mauricio, Brigadier General David Munguia Payes. FMLN members
control security, education, and intelligence elements of the GOES.
Foreign policy is in the hands of a loyal FMLN member, but has thus
far been characterized by pragmatism and outreach to the U.S.
Combating violent crime and rejuvenating the economy are the GOES's
top priorities, but the Funes administration has made little
progress on either issue since taking office last June. End
Summary.



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Good Relations with U.S. Essential

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

¶3. (C) On the day he was inaugurated, President Funes told
Secretary of State Clinton that his government needs a good
relationship with the United States. Three out of every ten
Salvadorans live in the U.S. and those who remain at home are avid
consumers of all manner of American products, media, and culture.
Nearly half of all Salvadoran exports are to the U.S. Given
transnational crime links to and from the U.S. via Central America,
there are no serious alternatives to cooperation with U.S. law
enforcement agencies. The Salvadoran military admires and trusts
our armed forces, and naturally look to us for training, equipment,
and mentoring. USAID and MCC are prominent actors in social and
economic development and are held in high esteem by the GOES and
the people of El Salvador. As a result, the Salvadoran public is
among the most pro-American in the hemisphere. Even the hard-line
FMLN recognize these points, if at the same time they do not forget
our role in preventing them from seizing power with violence during
the country's protracted and bloody civil war.



¶4. (C) There is a growing division between Funes and the party that
brought him to power. Funes joined the FMLN at the end of the 2009
presidential campaign. Throughout the campaign, he maintained a
close group of pragmatic, non-FMLN advisors (the Friends of
Mauricio), a fact which rankled some FMLN hard-liners. Since Funes
took power, tensions between Funes's centrist camp and the far-left
FMLN leadership have grown. Funes has publicly rebuked his own
Vice President, FMLN hard-liner Salvador Sanchez Ceren, and other
members of the FMLN for advocating policies that sharply depart
from Funes's moderate reform strategy. The FMLN appears content to
ride Funes' high approval numbers while applying pressure via
street protests, radical rhetoric, high-profile travel to Havana
and Caracas, and back-room legislative maneuvering. So far, the
fragile pact between Funes and the FMLN remains intact, but the
relationship is clearly strained.



¶5. (C) The political right is in disarray, though there are signs
that the worst of the post-election turmoil may be over. After
losing the presidential elections in March 2009, (center-right)
ARENA has seen 13 of its 32 legislative deputies leave the party,
12 of them forming a new party, the Grand Alliance for National
Unity (GANA). In December 2009, ARENA expelled former President
Tony Saca (2004-2009) from the party for alleged involvement in
GANA's rebellion. While collectively the right-of-center parties
could control a majority in the Legislative Assembly, infighting

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and opportunism have prevented them from uniting to mount an
effective opposition to the FMLN's and President Funes's proposals.
However, inter-party bickering on the right has died down in recent
months, and recent conversations with ARENA leaders suggest the
party is finally righting the ship after more than a year of
internal confusion and passivity. If this rebound strategy works,
a rejuvenated ARENA could serve as an important base of support for
President Funes in his struggle with the far-left FMLN leadership.




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

Military and Defense Update

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

¶6. (S) Responding to public pressure to stem escalating rates of
violent crime, in November 2009, President Funes deployed
approximately 2,500 soldiers to occupy and control 28 of the most
violent urban areas in the country. These forces supplement the
1,700-2,000 troops already operating joint patrols with the
National Civilian Police (PNC), meaning that about half of the
Salvadoran Army's 10,000 soldiers are engaged in domestic law
enforcement. Aside from natural disaster relief efforts, this is
the largest domestic deployment of the ESAF since the end of the
1980-92 civil war. While initially popular, a consensus has
emerged that the added military presence has not significantly
reduced violent crime.



¶7. (SBU) Highlights of the bilateral military relationship include:



-- Cooperation and training programs intended to maintain a rich
military-to-military relationship in humanitarian
assistance/disaster relief, counter-terrorism, counter-narcotics,
and peacekeeping operations.



-- As a testament to the strength of the mil-mil relationship and
the effectiveness of our training programs, El Salvador deployed
troops to Iraq from August 2003 until early-2009 who were
considered professional and competent by U.S. and coalition
members.



-- In November 2009, Southern Command helicopters, based in
Honduras, ensured rapid and effective delivery of emergency (mostly
USAID) supplies in the wake of tropical storm Ida.



-- In June 2009, the USNS Comfort visit provided medical attention
to nearly 20,000 people and two engineering projects to rural
communities. Beyond-the-Horizons deployments are scheduled for
2010 and 2011. In November 2009, the Chief of the Salvadoran Navy
signed a letter of request for four high-speed maritime
interceptors under the Enduring Friendship Program.



-- In April 2009, we renewed the agreement to operate a Cooperative
Security Location (CSL) for another five years. The CSL is located
at the military end of the international airport, and serves as a
regional hub for counter-drug detection-and-monitoring flights.



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U.S. Priorities

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

¶8. (SBU) Our work in El Salvador is focused on (1) promoting
improved public security; (2) supporting stable, democratic
governance; (3) broadening economic prosperity; and (4) investing
in people.

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¶9. (SBU) Although El Salvador has made remarkable progress since
the 1992 Peace Accords, violent crime continues unabated. The
Central American Regional Security Initiative (CARSI), coupled with
ongoing efforts to strengthen the police, expand crime prevention
programs, and implement judicial reforms, aims to improve public
security and the rule of law. On February 18, the Legislative
Assembly passed a landmark wiretap law which will help authorities
combat the growing problem of telephone extortions and assist
investigations into a wide range of criminal activities. The
significant USG commitment to improving regional security, as
evidenced by the presence of the CSL and the International Law
Enforcement Academy (ILEA), provides us with additional credibility
with the Funes administration.



¶10. (SBU) Promoting economic growth, spurring job creation, and
encouraging investment are important near-term USG priorities.
Funes's electoral victory had a great deal to do with public
dissatisfaction over economic conditions in El Salvador. Funes
inherited an economy already in recession and a fiscal deficit
which severely limits what he can do to stimulate growth. The GOES
expects to raise $190 million in new revenue with a tax reform
passed in December 2009; however, many economists project far lower
revenue growth. The private sector has criticized the tax reform
as excessively complex and poorly timed given the economic
downturn. Business leaders also complain the GOES has yet to
detail regulations on how it will implement the new taxes.
Redirecting loans from multilateral institutions from debt
refinancing to budget assistance will provide some immediate fiscal
relief. El Salvador's economic recovery will largely depend on the
U.S. economy, the destination for about half of its exports and
major source of remittances ($3.8 billion, or 18 percent of GNP, in
2008). In the short run, the ($461 million) Millennium Challenge
Corporation project will provide much-needed fiscal stimulus and
new jobs, while CAFTA and our USAID assistance programs will help
strengthen the foundations for future prosperity.



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

The Way Ahead

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

¶11. (S) Although the Salvadoran electorate granted President Funes
a mandate for change, by all appearances the voters expect him to
work with the country's dynamic private sector, and to maintain
good relations with the United States. Despite continuing problems
with crime and a weak economy, the public is pleased with Funes's
work thus far - his approval rating is above 80 percent in recent
polling. Tensions between Funes and the FMLN could undermine
governability and potentially damage the bilateral relationship
with the U.S. Meanwhile, transnational organized crime and violent
street gang activity pose as serious threat to the stability of the
country. Your visit will help reaffirm our commitment to assisting
the GOES in combating this non-traditional national security threat
while continuing our traditionally-strong military-to-military
relationship.
BLAU