AMBASSADOR'S TOUR D'HORIZON WITH GREEK MOD

C O N F I D E N T I A L SECTION 01 OF 02 ATHENS 000236

SIPDIS

E.O. 12958: DECL: 01/19/2009
TAGS: GR MARR PREL AMB
SUBJECT: AMBASSADOR'S TOUR D'HORIZON WITH GREEK MOD
SPILIOTOPOULOS

REF: ATHENS 179

Classified By: Amb. Charles P. Ries. Reasons 1.4(b/d)


1. (C) SUMMARY: In their introductory meeting on January 19,
Greek Defense Minister Spiliotopoulos told the Ambassador
that Greece was prepared to increase its presence in
Afghanistan by deploying a Role 2 Medical Unit to Herat.
Greece was not yet able to lift its caveat to allow Greek
staff officers to participate in the NATO Training Mission in
Iraq, but could participate in such a mission outside Iraq.
Spiliotopoulos highlighted transformation of the Hellenic
Armed Forces in the near term as a priority. He also assured
Ambassador that defense procurement contracts, limited as
they would be by Greece's severe economic constraints, would
be transparent and fair. Spiliotopoulos plans to travel to
Washington in April, and is interested in a meeting with
SecDef. END SUMMARY.

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AFGHANISTAN -- GREECE WILL PROVIDE MEDICAL FACILITY
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2. (C) In their first meeting on January 19, Spiliotopoulos
told the Ambassador that the Greek Permrep to NATO had
received instructions to announce Greece would increase its
participation in ISAF with a Role 2 medical facility for
Herat.

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GREECE WILLING TO TRAIN IRAQIS, BUT NOT IN IRAQ
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3. (C) In response to Ambassador's question about Greek
participation in Iraq, Spiliotopoulos reiterated reftel
comments from MFA that Greece was not yet able to authorize
its NATO/SHAPE officers to travel to Iraq as part of the NATO
Training Mission-Iraq. Spiliotopoulos indicated, however,
that Greece was prepared to support the goal of the NATO
mission with trainers outside Iraq. Ambassador underscored
the opportunity afforded by the January 30 elections in Iraq
for the Iraqi people to govern themselves; these elections
must succeed and must be reinforced by an improved security
situation -- the point of the NATO mission. Ambassador
acknowledged that coalition activities in Iraq were not
popular in Greece, but NATO had nevertheless signed on to
provide training, and Alliance cohesion must be preserved.


4. (C) Ambassador urged Spiliotopoulos to review its
national caveats. Of the six NATO Allies still refusing to
participate in the NATO mission, Greece should not be the
last to reverse its position. (NOTE: The Dutch later told us
that in their lunch with Spiliotopoulos after the
Ambassador's meeting, Spiliotopoulos raised the NATO training
mission, expressing some frustration that the U.S. was not
satisfied with training outside Iraq. Greece, Spiliotopoulos
told the Dutch, was fully prepared to train Iraqis "in
Dubai." END NOTE.)


5. (C) Ambassador asked whether Greece would consider
donating some of its Soviet-era "BMPs" (APCs) to Iraq as
excess equipment. Spiliotopoulos claimed Greece was using
these BMPs at the present time, but did have plans to replace
them. Ambassador urged the MOD to review this issue, as the
BMPs could materially assist security operations by Iraqis.

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TRANSFORMATION UNDERWAY, PROCUREMENT STALLED
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6. (C) Spiliotopoulos, an enthusiastic proponent of
transformation, briefed Ambassador on his plans to reduce the
size of the Hellenic Armed Forces from 175,000 to 145,000, to
focus on modernizing equipment (particularly C4I),and to
prioritize interoperability and flexibility. Spiliotopoulos
claimed that Greece would meet its transformation goals by
the end of 2005.


7. (C) Pointing out that while Greece still spent more money
that any other Ally on defense except (and because of)
Turkey, Spiliotopoulos noted that defense spending had fallen
from a high two years ago of 4.5 percent of GNP to roughly
2.9 percent of GNP. Greece's dire economic straits were
affecting procurement, and Spiliotopoulos was facing a 40
percent decrease in procurement in 2005. This was the "only
way" Greece could comply with the EU requirement of 3 percent
deficit spending. Spiliotopoulos told Ambassador that the
Prime Minister had decided to cut defense spending in order
to salvage social programs. After 2008, he hoped, Greece
would be able to increase procurement with an emphasis on
fighter planes and frigates. For now, Spiliotopoulos claimed
the MOD would only have money to pay off existing loans.


8. (C) Ambassador told Spiliotopoulos that Greece and the
U.S. had enjoyed excellent defense cooperation in the past,
and he looked forward to working on transformation and
procurement issues together. Ambassador's main priority was
to ensure a level playing field and a transparent process for
contracts.


9. (C) Emphasizing the state-of-the-art equipment available
from U.S. companies, Ambassador noted that the current
exchange rate offered excellent value for Greece.
Spiliotopoulos assured Ambassador that transparency in the
procurement process was a chief goal. His staff was working
on a revised legal framework for defense procurement to
ensure transparency and to close all the loopholes in Greek
legislation that had allowed previous questionable defense
contracts to stand. Spiliotopoulos noted that some of the
revised legal framework had been drawn from U.S.
anti-corruption legislation. He assured Ambassador that his
MOD would "stick to the rules of the game and the
marketplace."

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FAMILY TIES DON'T EQUAL GOOD BILATERAL RELATIONS
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10. (C) In a brief discussion of Turkey, Spiliotopoulos
noted that while PM Karamanlis and Turkish PM Erdogan enjoyed
good "family relations", these ties did not translate into
improved bilateral relations, as recent incidents in the
Aegean had demonstrated. Greece had fully and openly
supported a date for the EU to begin accession negotiations
with Turkey; unfortunately, he said, Turkey did not yet
understand that its "unilateral" claims (airspace,
continental shelf) were unacceptable. Turkey must respect
international and European law. That said, he agreed the
progress made to put Turkey on a European path should be seen
as a path to reduce tensions in the Aegean.

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VISIT TO THE UNITED STATES
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11. (C) At the conclusion of the meeting, MOD Diplomatic
Advisor Bourliyannis briefed Ambassador on Spiliotopoulos's
spring travel plans, highlighting a proposed April 10-12
visit to the U.S. and asking Ambassador to assist with a
meeting between Spiliotopoulos and SecDef Rumsfeld.
Spiliotopoulos, who noted he had enjoyed recalling fighter
pilot days with SecDef, also mentioned that a meeting might
be possible on the margins of NATO meetings in Nice or at
Wehrkunde.