VZCZCXYZ0000
PP RUEHWEB
DE RUEHBU #0586/01 1262015
ZNR UUUUU ZZH
P 052015Z MAY 08
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC PRIORITY 0939
INFO RUCNMER/MERCOSUR COLLECTIVE
UNCLAS BUENOS AIRES 000586
SENSITIVE
SIPDIS
TREASURY FOR LTRAN, MMALLOY, AND USED OFFICE AT IDB
E.O. 12958: N/A
TAGS: PGOV PREL EAID EFIN KDEM AR
SUBJECT: AMBASSADOR MEETS WITH TIERRA DEL FUEGO GOVERNOR
REF: A) BUENOS AIRES 568
1. (SBU) Summary: The Ambassador met April 29 with Tierra
del Fuego Governor Fabiana Rios, Argentina's first elected
female governor. Governor Rios was straightforward and
cordial throughout the meeting, during which she explained
her province's abysmal financial state. Rios solicited the
Ambassador's advice on how to best approach the
Inter-American Development Bank (IDB) to fund a study that
would help Tierra del Fuego improve its provincial
administration. The Ambassador informed Rios that the USS
Farragut was headed to Ushuaia in mid-May (14-18) and would
be donating supplies to the local hospital. End Summary.
A Province in Disarray
----------------------
2. (SBU) Ambassador Wayne met with Governor Fabiana Rios and
her economic advisor Ricardo Iglesias on April 29 in his
office. Rios is the first elected female governor in
Argentine history and the first from the opposition party
ARI, member of the Civic Coalition (CC) (led at the national
level by CC President Elisa Carrio, who finished second in
the October 2007 presidential election). Rios detailed her
province's dire financial straits, exacerbated (she claimed)
by the mismanagement of the prior governor, Hugo Omar
Coccaro. She said that her biggest challenge is rebuilding
institutions, which she said deteriorated significantly under
Coccaro.
3. (SBU) Rios said she has sought a constructive working
relationship with the national government because of her
province's financial dependence on the national government.
Rios described the financial state of the province as "more
than bad, it's terrible." Although the constitution obliges
the national government to share revenues (or
"co-participation" funds) with the provinces, the national
government doles the funds out at its discretion. Rios said
these funds account for 70% of her government's budget.
Fixing a Broken System
----------------------
4. (SBU) Rios said that 110% of Tierra del Fuego's current
budget goes to payroll. The provincial government lacks an
inventory of human resources. Rios said they don't know who
the employees are, where they work, what they do, or to whom
they report. For example, Rios said that in a press section
with 80 people only 4 are professionals -- the rest are
"cleaning staff." She also said that the hospitals have 5
cleaning or administrative workers for every doctor. There
were four school teachers for each available class room.
Rios lamented that there was no "normal" solution to the
province's financial troubles.
5. (SBU) Rios said she wanted to approach the Inter-American
Development Bank (IDB) to finance a census of the provincial
government's financial and human resources, to be followed by
a rationalization and downsizing of the provincial payroll.
In anticipation of the downsizing, she hoped the IDB could
develop a training program geared towards easing the pain of
the inevitable layoffs by making these people more marketable
for the private sector.
6. (SBU) Rios solicited the Ambassador's opinion on the best
way to present the government's plan to the IDB. The
Ambassador explained that the IDB has an overall program
budget for Argentina and they look for good projects to
invest in and that one of the areas they focus on is public
administration. The Ambassador highlighted the IDB's program
in Argentina as the biggest they have at present. He said
the challenge was to present worthy, feasible proposals with
a solid, sustainable plan. Rios said she had little
experience with international organizations, but had started
technical discussions with the IDB. Ambassador Wayne
suggested inviting experts from the IDB to travel to Tierra
del Fuego and observe the situation. Rios also asked for USG
support of their contact with and application to the IDB.
The Ambassador said the Embassy economic section could help
establish contact with the local IDB office.
Not Affected by Ag Strikes
--------------------------
7. (U) Rios noted that Tierra del Fuego has not felt the
effects of the agricultural strike in availability of food.
She said that the province's economic system -- based on
sheep, fish, and gas -- was different and too far away to
feel the effect. Rios mentioned that 80% of the province's
land was in the hands of only 100 people.
Gas Restrictions
----------------
8. (SBU) The Ambassador asked if the new gas law would give
Tierra del Fuego more control over natural resources. Rios
said that the law gives jurisdiction to the provinces but
noted that strategic decisions are made at the national
level, so the provinces don't have as much control. Her
government is, however, preparing to have a bidding process
for new areas for September. The Ambassador observed that it
also has been difficult for companies operating in the
region, such as Apache Oil, because of the Argentine
government's limits on gas exports to Chile. The Ambassador
told Rios that he had recently met with Planning Minister De
Vido (reftel) to raise Apache's concerns about GOA
interference shutting down its gas exports and about the
limited ability to export north to Argentines. De Vido told
the Ambassador that the bidding process for the second gas
pipeline would begin in the next few months. The Ambassador
mentioned that negotiations with Chile and Methanex were
complicated, but the high price of gas agreed to recently
apparently prevents the company from operating. Rios said
she had heard a similar message from the Canadian Ambassador
(Methanex is a Canadian company). Rios mentioned that she
planned to meet with De Vido during her trip to Buenos Aires.
9. (U) Rios mentioned that she spent 15 days traveling to
offshore platforms because she wasn't familiar with them.
Ambassador noted that the subject of gas exports was
constantly on Argentina's bilateral agenda with Chile. Rios
said that if Methanex can't produce, there are upstream
implications for Tierra del Fuego, and "we all lose."
Preserving Nature
-----------------
10. (U) The Ambassador brought up the issue of nature
preservation, mentioning that two or three years ago Goldman
Sachs had donated land to the Chilean government to build a
nature preserve. He mentioned the company had hoped to do
the same in Argentina, but the effort was blocked by private
interests. Rios said Tierra del Fuego was beautiful, but had
a vulnerable ecosystem. She cited sustainable development
efforts that would preserve the natural lakes and thermal
springs in the area. The Ambassador agreed that there were
ways to have tourism and preserve nature.
Small Steps Forward
-------------------
11. (U) Rios emphasized the importance of getting out the
provincial government's message of honesty, transparency, and
production. She said it was important to give clear signals
that there was no corruption in the government, which had
been a problem in her predecessor's administration. Rios
cited specific measures her government had taken to improve
things in the province. She mentioned increasing
transparency as one of her primary goals. To that end, she
has made public spending numbers available on her website.
Rios acknowledged that these were small changes; but that
they were important cultural changes nevertheless.
Activity in Ushuaia
-------------------
12. (U) Ambassador Wayne told Rios that the USS Farragut
will be in Tierra del Fuego's capital, Ushuaia, from May
14-18 for a ship visit and strengthening of ties between our
armed forces. He informed Rios that the crew plans to donate
medical supplies and hygiene supplies to the local hospital.
The Ambassador also mentioned that the crew had offered to
conduct a blood drive for the Regional Hospital in Ushuaia.
Rios looked forward to the visit and said her health minister
would be very pleased to hear about the ship's plans. The
Ambassador said he had visited the Binational Center in
Ushuaia for English language instructors and that the
consular section has a good working relationship with local
authorities. Rios said the mayor of Ushuaia, Federico
Sciurano, was not of her party but described him nonetheless
as young, hard-working, and reasonable.
Help with Housing
-----------------
13. (U) Iglesias concluded the meeting by bringing up Tierra
del Fuego's housing crisis and said that they were looking to
develop a housing plan to attract investment. He was
specifically interested in pre-fabricated housing providers
in the U.S. who would be interested in supplying Tierra del
Fuego. Iglesias also mentioned that constructing houses was
particularly difficult in the winter in Tierra del Fuego.
The Ambassador offered Embassy commercial section assistance
in identifying U.S. purveyors of pre-fabricated housing as
well as contacts at the World Bank in charge of housing
assistance.
Comment
-------
14. (SBU) Although Tierra del Fuego is remote and sparsely
populated, Governor Rios gained a great deal of attention
with her 2007 defeat of an entrenched incumbent backed by the
Kirchners. She is the nation's first female provincial
governor, and the only governor elected by opposition party
ARI. With the Ambassador, she conveyed a sense of urgency in
overcoming the challenge presented by the province's
financial situation. Rios is inheriting a bloated state
apparatus without inventories, adequate databases or other
basic management tools. Her steps to increase transparency
and her obvious energy to confront these problems, however,
are a welcome step towards better provincial management in
Tierra del Fuego. End comment.
Bio Note
--------
15. (U) Rios was born in Rosario, Santa Fe Province, on
March 31, 1964. She is married to Gustavo Longhi, a
provincial councillor in Rio Grande who won re-election in
2007. The couple has two daughters; Maria Betania (17) and
Victoria (14). Rios was previously a national deputy in
2003, and a provincial legislator from 199-2003. She also
served as the Pharmaceutical coordinator in the Provincial
Institute for Social Services in Tierra del Fuego
(1997-1999); Coordinator of Pharmaceutical Allowances under
the same institute (1996) and some other public health
positions in the municipality of Rio Grande in Tierra del
Fuego. Rios received her degree in pharmacy from the
National University of Rosario and won a national award for
her professional record in 2001.
WAYNE