SPANISH OFFICIALS DISCUSS VENEZUELA SALE WITH

1. (C) Summary: Spanish Deputy Defense Minister Francisco
Pardo requested a meeting with Charge Friday, March 11 to
explain Spain's plans to sell military equipment to
Venezuela. In the meeting, Pardo denied reports that Spain
would sell "Corvette" gunships to Venezuela, said none of the
equipment sold would be for offensive use and repeatedly
insisted Spain wanted no misunderstandings with the U.S. on
the issue of the sales to Venezuela. Charge spoke again with
Pardo March 15 to discuss Pardo's comments on the Venezuela
sale to the Senate Defense Commission. Pardo insisted again
that none of the equipment included in the sale would be for
offensive purposes, although he did say Spain planned to sell
the Chavez government "oceanic" patrol boats. Pardo also
emphasized the ship sales were critical to the survival of
state-owned shipyard Navantia. On March 16, Spanish Foreign
Ministry political director Rafael Dezcallar said Spain
shares the USG's concerns about Chavez' negative influence in
the region, and will work to check Chavez's destabilizing
activities. Charge told Pardo and Dezcallar that if Spain
wants to improve bilateral relations with the U.S., Spain's
high-level outreach to Chavez -- including these proposed
sales -- is no way to go about it. End summary.



2. (SBU) On Friday, March 11, Pardo asked Charge for a quick
meeting later that day to explain the government of Spain's
plans for military equipment sales to Venezuela. (NOTE:
Pardo,s call followed March 10 meetings in Madrid U.S.
Attorney General Gonzales had with Spanish Vice President
Maria Teresa Fernandez de la Vega and FM Moratinos during
which AG Gonzales expressed the USG,s concern regarding
Spain,s policies towards Venezuela. END NOTE.) In the
meeting with Charge, Pardo said he wanted us to know that,
contrary to press reports, Spain is not selling Corvette
gunships to Chavez, rather "defensive" items such as Coast
Guard/Maritime patrol boats and transport aircraft. He said
Spain was willing to sell the same/similar equipment to
Colombia.



3. (C) Throughout the meeting, Pardo repeatedly insisted
that Spain wanted no misunderstandings with the U.S. on this,
and said the sale was vital to Spain's quasi-governmental
defense manufacturing company, Navantia (formerly called
Izar). Pardo said the company was about to collapse without
such a sale. Pardo also insisted the Spanish government
sought to influence Chavez and that a meeting currently being
worked out that would be in Venezuela with Chavez, Spanish
President Zapatero, Brazilian President Lula de Silva and
Colombian President Uribe was an effort, spearheaded by Lula,
to apply joint pressure on Chavez. Pardo concluded by saying
the GOS wants to be completely transparent with the U.S. on
the sale issue and wants the information the U.S. gets on the
matter to come directly from the GOS, not from other
potentially inaccurate sources.



4. (C) Charge replied that while we appreciated Pardo's
transparency in informing us about the sale, that fact that
we listened to the explanation in no way could be interpreted
to imply that the USG approves or agrees with these sales or
Spanish rationale for its outreach to Chavez. Charge noted
it was difficult to see how these overtures would influence
Chavez to end his adventurism in the region and embark on
true democratic reform. Charge further stated that we do not
understand the Spanish government's outreach to Chavez and
what GOS hopes to gain by it other than helping Navantia.



5. (SBU) Pardo also told Charge he planned to inform the
Spanish Senate's Defense Commission on Monday, March 14,
about the Venezuela sale.



6. Pardo made his presentation to the Senate Defense
Commission March 14. Press reports the next day conflicted
over what Pardo said and what, in fact, Spain was proposing
to sell to Venezuela. Charge thus telephoned Pardo to get
some clarity. Pardo said reports by national daily El Pais
(close ties to Socialist Party) that Spain planned to sell
Venezuela, among other things, a number of Corvette warships,
were simply incorrect. Pardo emphasized that nothing Spain
would sell Venezuela would be for "offensive use." Pardo
said the deal would include civilian transport ships,
military transport planes, coastal patrol boats and "oceanic"
patrol ships. He said none of the ships would include
helicopter landing pads or cannons, despite press reports to
the contrary. Pardo declined to tell Charge how many ships
and planes Spain planned to sell, but a press report (Europa
Press internet wire service) which Pardo termed as "accurate"
said the deal would provide jobs for 600 workers at Navantia
for six years, and 300 jobs for the Spanish subsidiary of
EADS aerospace firm for three years. Pardo asserted again to
Charge that the sale was important for Navantia's survival.
He added that he would get Charge a transcript of the Senate
proceedings so Charge could see exactly what Pardo said to
the Commission. Charge re-stated to Pardo that we failed to
understand Spain's outreach to Chavez and said it would not
be constructive for U.S.-Spain relations.



7. (C) In a March 16 conversation with Charge, the MFA's
political director, Rafael Dezcallar, said Spain shares the
USG's concerns about Chavez' destabilizing influence in the
region. Dezcallar assured Charge the GOS will work to curb
potentially dangerous Venezuelan actions. "Spain wants to be
on the same side as the U.S. with respect to Venezuela,"
commented Dezcallar. Specifically on the armaments sale,
Dezcallar said the MFA has somewhat been at odds with the
Defense Ministry on this issue and is trying to balance
Navantia's needs with the impact the sale would have on
Spain's relations with other countries, including the U.S.
As such, the MFA is trying to pare back the sale a bit,
though Dezcallar did not say in what way. Dezcallar also
said Spain would be very much interested in seeing any
intelligence the U.S. has on Chavez' mischief in the region
and would work with the U.S. to act on it.


8. (C) Comment: Despite Pardo's assurances that none of the
military equipment Spain plans to sell Chavez will be used
for offensive purposes, Chavez can obviously use the
equipment offensively if he chooses. According to DAO
Madrid, the oceanic patrol ships Pardo mentioned can displace
anywhere from 1500 to 1600 tons (Spanish military sources
told DAO the vessels will be similar to Spain,s Serviola
class ships), are specifically designed to navigate the high
seas and can be outfitted with 76 mm guns that can reach a
target over 6 miles away.



9. (C) Comment continued: Regardless of Chavez's true
intentions, the Spanish government's approach with us on its
policies toward Venezuela is either naive or disingenuous or
both. Embassy Madrid's concerns are twofold -- the effect of
Spain's actions on our Venezuela/regional polices, and their
effect on the bilateral relationship between the U.S. and
Spain. We have told the Spanish government over and over
again that if it truly wants to improve bilateral relations
with us (which senior GOS officials continually tell us),
Spain's high-level outreach to Chavez (as well as to Castro),
which is neither understood nor welcomed by Washington, is
not the way to go about it.

MANZANARES