Oct 282014

Reference ID Created Released Classification Origin
2009-11-17 23:30
2011-08-30 01:44
Embassy Manila

DE RUEHML #2400/01 3212330
O 172330Z NOV 09


E.O. 12958: N/A

¶1. Chairman Filner, welcome again to the Philippines. Your visit
comes during an exciting time in the Philippines, as the official
campaign for the May 2010 nationwide elections kicks off at the end
of November. The United States and the Philippines have a
longstanding and deep relationship based on nearly 50 years of
direct American administration, a Philippine government modeled on
the U.S. government, broad economic ties, and an extensive
interchange of people. The more than four million
Filipino-Americans now constitute the largest Asian ethnicity in the
United States, while some 250,000 U.S. citizens reside in the
Philippines. The memory of our partnership in World War II still
resonates here, and the recent passage of the Filipino Veterans
Equity Compensation provision has served to further bolster the
unique bond shared between U.S. and Philippine veterans. U.S.
interests in this major non-NATO ally center on strengthening
democracy, fostering economic growth, fighting terrorism and other
threats to security, and providing superb services to our American
and Filipino publics. The U.S. is the largest assistance grant
donor to the Philippines, its largest trading partner, and the
largest investor.

¶2. Your visit will include calls on senior Philippine officials, a
visit with a joint U.S.-Philippine military task force in the
southern Philippines, a tour of the VA Manila facilities, and
several opportunities to visit historical sites in and around
Manila. Our entire team looks forward to making your visit
productive and useful to you.


¶3. The Philippines, with almost 90 million people, has one of the
fastest growing populations in Asia. Metro Manila, home to at least
12 million people, is the largest city in a country of over 7,000
islands. Literacy (94%) remains high, although the standard of
public education and other government services has declined in
recent decades. Filipinos are mainly Roman Catholic (83%) or
otherwise Christian (10%) with a small Muslim minority (6%) based in
Mindanao, where you will travel. Over 40 percent of Filipinos earn
less than $2 per day, with a much higher percentage of Muslims eking
out a living below this threshold.


¶4. The U.S. Department of Veterans Affairs Manila Regional Office
and Outpatient Clinic are the VA’s only full-service facilities
located in a foreign country. VA provides monetary benefits to
approximately 15,000 veterans and dependents residing in the
Philippines, and provides health care to approximately 4,300
veterans residing here. The VA operation in Manila has a sizeable
economic impact here, worth about $293.5 million in FY 2009. VA
also administers a medical equipment grant program to support the
Philippine Government’s Veterans Memorial Medical Center (VMMC). To
date over $5.5 million worth of medical equipment and facility
upgrades have been donated to the VMMC. Due to the low standard of
living in the Philippines and the cultural preference to conduct
business through middlemen, claims fraud remains a significant
challenge. While we have success in identifying fraud, obtaining
prosecutions through the Philippine justice system is difficult.

¶5. The VA Manila office has sole jurisdiction over the
administration of the Filipino Veterans Equity Compensation (FVEC)
benefit, passed as part of the American Recovery and Reinvestment
Act of 2009 (ARRA). Since its passage, VA Manila has had great
success in providing timely benefits to eligible veterans. To date,
VA Manila has found over 10,000 Veterans or their widows eligible,
and disbursed over $120 million of the allocated $198 million for
this program. Filipino veterans and their dependents in receipt of
VA benefits enjoy a far greater standard of living here than their
ineligible counterparts, many of whom receive benefits from the
chronically in-debt Philippine Veterans Affairs Office at the rate
of approximately $100 per month.


¶6. The Social Security Administration Division in Manila serves as
the hub for Social Security work for all the Embassies and
Consulates in the East Asia Pacific Region. The division currently
serves 41,000 beneficiaries and pays out over $25 million each
month. In the Philippines alone, there are almost 20,000


¶7. The Consular Section provides services (reports of birth,
passports, notarial and emergency support) to the approximately
130,000 Americans living in the Philippines as well as the roughly
120,000 Americans who visit the Philippines at any given time. The
Consular Section issues about 60,000 immigrant visas a year,
including visas to large numbers of nurses, teachers, and physical

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therapists. The Consular Section sees almost 200,000 nonimmigrant
visa applicants annually, including large numbers of merchant marine
mariners and temporary seasonal workers.


¶8. Philippine political life is free-wheeling, centered primarily
on the personal charisma of individual political leaders, with most
wealth and political power limited to a few influential families.
President Gloria Macapagal Arroyo assumed the Presidency in 2001
after a “people power” movement swept her predecessor out of office.
She was elected in her own right in controversial voting in May
¶2004. With less than a year left in office, President Arroyo
continues to balance competing political interests amidst economic
challenges. President Arroyo has weathered numerous unsuccessful
impeachment efforts and low-level military coup attempts. With
national elections scheduled for May 2010, nearly 20 cabinet members
have announced their intention to seek elected office of some sort.
Candidates for President, Congress, and Mayors positions must file
their candidacies by November 30. You will arrive amid intense
jockeying for position as candidates start to file.


¶9. President Arroyo continues to express her commitment to making
greater progress on the long-standing problem of extrajudicial
killings, and has taken concrete steps in this direction. Partly
due to increased attention by the Philippine government, the number
of extrajudicial killings decreased dramatically through 2007 and
2008, but the Philippine government acknowledges the need to do more
to ensure that all such crimes are fully investigated, and that
those responsible are brought to justice. The Embassy continues to
press the issue at the highest levels of the Philippine government,
and continues to conduct a comprehensive plan of public outreach
activities, training, and institution building to make further
progress in addressing the problem.


¶10. The U.S. remains the Philippines largest trading partner, with
over $18 billion in two-way merchandise trade in 2008. Major U.S.
exports include electronics and agricultural products. The U.S. is
also the largest investor here, with over $6 billion in assets. The
large American Chamber of Commerce in Manila is proud of its history
as the first American Chamber of Commerce abroad.

¶11. The Philippines has largely avoided the effects of the
worldwide recession, and the economy is projected to grow between
one and two percent in 2009. Low levels of government
infrastructure investment and public spending on health and
education present serious challenges to poverty alleviation.
However, a resilient service sector (particularly a booming business
process outsourcing industry) and strong overseas workers’
remittances (expected to increase to more than $17 billion in 2009,
more than 10% of Philippine GNP) have helped the Philippines through
this period of global economic slowdown. The United States assists
in economic development, anti-corruption, environmental protection,
and poverty alleviation programs through our USAID programs, U.S.
Department of Agriculture programs, and through the efforts of an
active Peace Corps program.


¶12. The U.S. has designated four extremist groups as Foreign
Terrorist Organizations — Jemaah Islamiyah, the Abu Sayyaf Group,
the Rajah Solaiman movement and the New People’s Army. The first
two groups currently pose the most direct threats to U.S. interests
and are located in the poor, predominately Muslim south. The New
People’s Army operates throughout the country. We work closely on
developing the capacity of the Armed Forces of the Philippines and
the police to combat terrorists. We provide training and equipment,
engage in a robust program of joint military exercises, and are
currently undertaking a joint, far-reaching program to reform the
Armed Forces of the Philippines into a modern, effective force.
The Philippines and the United States have scored important
successes on the security cooperation and counterterrorism fronts.
This alliance has resulted in the death or capture of a dozen key
terrorist leaders and over 250 other terrorism suspects in the last
three years. Our Rewards for Justice Program provides incentives to
identify and arrest terrorists. About 60% of USAID’s annual
development assistance is channeled to conflict-affected areas of
Mindanao to build infrastructure and carry out health, renewable
energy, environment, education, and livelihood programs. These
programs attack the conditions of poverty that provide a breeding
ground for terrorists. USAID coordinates its activities with the
U.S. military’s Civil Affairs programs. Our exchange programs for
students and community leaders offer a chance to interact with
responsible and moderate Muslims.

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¶13. In recent weeks, the Philippine government and members of the
separatist Moro Islamic Liberation Front (MILF) have established a
new ceasefire and taken steps toward restarting formal peace talks,
demonstrating that both sides share a mutually reinforcing
commitment to peace. This ceasefire ended a year of fighting that
followed a Philippine Supreme Court Decision in August 2008 that a
key peace deal with the MILF was unconstitutional. The two sides
have pledged to work toward a new framework for engagement and to
aid the return of internally displaced persons affected by the
conflict. U.S. support through development assistance will be an
important component of a successful peace process.




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