AMBASSADOR RAISES CLIMATE CHANGE, EU CHEMICALS

C O N F I D E N T I A L ROME 003277

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E.O. 12958: DECL: 07/03/2013
TAGS: ECON SENV TSPL KSCA EAID PGOV IT EUN
SUBJECT: AMBASSADOR RAISES CLIMATE CHANGE, EU CHEMICALS
POLICY, AND BIOTECHNOLOGY WITH MINISTER OF ENVIRONMENT

Classified By: Ambassador Mel Sembler for reasons 1.5 B and d.


1. (C) Summary. Ambassador met Minister of Environment Altero
Matteoli July 2 to discuss priority issues that might emerge
during the Italian EU Presidency. Ambassador praised Italy's
position on climate change and Kyoto, pointing out that PM
Berlusconi had taken a significant political risk in
promoting research cooperation with the U.S. at a time when
most member states were critical of the President's decision
to withdraw from the Kyoto protocol. On the EU chemicals
proposal (REACH),Matteoli said that industry would have to
deal with environment ministries and their concerns, but the
days were past when environment ministries were enemies of
industry. Matteoli added that he would include economic
considerations in the Italian appproach. Despite strong
representations from Ambassador on the need for strong
science-based policy on biotechnology, Matteoli said the only
solution for Italy would be found in a complex, step-by-step
political process. He acknowledged the successful blocking
role of Agriculture Minister Alemanno. End summary.


2. (U) Ambassador hosted Minister of Environment Altero
Matteoli for lunch at the residence on July 2. Matteoli was
accompanied by his diplomatic adviser, Gabrielle Sardo, and
Director General for International Activities Corrado Clini.
Ambassador was joined by ECMIN and EST Counselor.
AMBASSADOR'S CALL FOR LEADERSHIP ON BIOTECH UNANSWERED


3. (C) Ambassador contrasted the leadership shown by the GOI
on climate change in 2001, when PM Berlusconi announced on
the eve of the Genoa G-8 summit a new commitment to research
cooperation with the U.S. outside of Kyoto, with the much
slower GOI approach to biotechnology policy. Matteoli
replied that the biotechnology question was far more
complicated politically than Kyoto, in large measure because
the ideological convictions of MINAG Alemanno made him less
receptive to mediation efforts, even within Alleanza
Nazionale (AN),the party of Alemanno and Matteoli.
According to the Minister, the only solutions possible for
Italy will lie in slow and careful political moves. Matteoli
dismissed the weight of scientific opinions, labelling
scientists as outliers in the public debate. Matteoli said
that he had worked hard on the EU traceability and labeling
proposals to keep at least an opening for biotechnology in
Europe. While Alemanno might follow him one step, the
Minister of Agriculture would not allow himself to be led
very far on the issue. Matteoli held out little hope of
effective mediation with Alemanno even within AN, pointing
out that the wings of the party were sharply divided on
biotechnology policy. He claimed that Alemanno's convictions
were genuinely felt, and formed under the ideological
mentorship of a strong rightwing leader, Pino Rauti, who was
for a time Alemanno's father-in-law as well.


4. (C) Embassy comments: Although DG Clini floated the
possibility of a "consultation" with the U.S. on
biotechnology after the European Parliament votes on F&F and
T&L July 2-3, we doubt we can get much leverage with the GOI,
as EU President, through a meeting led by the MOE. We
continue to worry that Alemanno, a strong supporter of the
coexistence language amending 01/018, will use this language
to step over the Ministry of Environment and others in the
GOI to exclude from Italy even those biotech products
approved by the EU under the new directives and regulations.
End comment.

A BALANCED APPROACH ON CHEMICALS POLICY....


5. (C) REACH, the European Chemicals Policy, is still caught
between the competencies of the Environment Council and the
Competitiveness Council, according to Matteoli. The Minister
observed that however the decision turns out, the chemicals
industry will have to work with environment ministries.
These ministries, he argued, are no longer a priori hostile
to industry, but do have a responsibility to protect the
public and the environment while simultaneously promoting
economic growth. Ambassador noted that U.S. companies had
invested more than $2.5 billion in Italy, and that U.S.
companies were concerned with the potential high costs of the
REACH proposal. Matteoli said that a discussion of REACH at
European level could take place during the Italian EU
Presidency, but that the Irish Presidency would have to carry
forward the work. The Minister added that the record of the
chemicals industry would make credible work on regulation


more difficult in Italy, since state-owned industry had for
years not only contributed to dangerous pollution, but had
used the threat of job losses in negotiations with unions and
local governmental authorities to delay the implementation of
environmental safety rules.

SOME CLIMATE CHANGE "BUSINESS" WITH THE RUSSIANS, THE EU, AND
US...

6.(C) Looking toward COP-9 of the U.N. Framework Convention
on Climate Change(UNFCCC),to be hosted by the MOE in Milan
in early December, the Ministry is preoccupied with what to
do if Russia ratifies the Kyoto Protocol, and what to do if
it does not. The EU, and Minister Matteoli in particular, has
been in Moscow several times in recent months to explore the
issue of Russian ratification. According to the Italians,
talks have boiled down to the price per ton of carbon dioxide
Russia could sell the EU to help the EU meet its targets.
The Russians have reportedly opened at USD forty per ton,
while the EU started at about USD five per ton.

7.(C) If Russian ratification does not occur, and Kyoto does
not come into force, the MOE may open during the Italian EU
Presidency an internal EU dialogue on what to do next in the
face of the EU and member state ratifications of the Protocol.

8.(SBU) DG Clini confirmed decisions taken in Washington June
17 to organize a bilateral energy meeting in Califiornia in
September, and a side event at COP-9 to highlight the results
of U.S.-Italy cooperation in climate change. Clini reiterated
his hope that a twinning agreement could be struck between
the region of Lombardia and the State of California on
hydrogen technologies.

AND FIRST STEPS TOWARD COOPERATION WITH THE DEVELOPING WORLD

9.(U) Ambassador noted to the Minister our satisfaction with
the new agreement on geospatial technologies and applications
signed at the June 17-18 S&T bilaterals, and the agreement to
work on geothermal projects in East Africa and to cooperate
on environmental projects in Iraq. Such partnerships can
demonstrate to the developing world the seriousness with
which both countries take environmental stewardship.

10.(C) Embassy Comment. Matteoli began the luncheon
conversation stiffly but warmed to the Ambassador's questions
about coalition politics and its future, having some fun with
key ministers like Bossi and Tremonti: the Finance Minister
is reportedly the only coalition minister who will dine with
Bossi. He spoke clearly to divisions within his own AN
party--an internal division is 100 times worse than a
controversy between parties, he opined. The Minister is
obviously more comfortable in the political arena, in which
he characterizes himself as a mediator, than in technical
discussions of even the major issues in his portfolio.
Sembler
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2003ROME03277 - Classification: CONFIDENTIAL