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IdentifierCreatedClassificationOrigin
05ROME2051 2005-06-16 05:06:00 CONFIDENTIAL//NOFORN Embassy Rome
Cable title:  

U.S.-EU IRAQ CONFERENCE, ITALY UNLIKELY TO

Tags:   PREL PGOV EAID EIND ECON IT IZ EUN IRAQI FREEDOM 
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This record is a partial extract of the original cable. The full text of the original cable is not available.

160506Z Jun 05
					  C O N F I D E N T I A L ROME 002051 

SIPDIS


SENSITIVE

DEPT FOR EB/IFD/ODF (DEMARCELLUS)

E.O. 12958: DECL: 06/15/2015
TAGS: PREL PGOV EAID EIND ECON IT IZ EUN IRAQI FREEDOM
SUBJECT: U.S.-EU IRAQ CONFERENCE, ITALY UNLIKELY TO
ANNOUNCE NEW AID

REF: SECSTATE 103222

Classified By: A/Econ Min-Couns Kathleen Reddy for reasons 1.4 (b)(d).



1. (SBU) Summary: Italian Foreign Minister Fini will attend
the Brussels conference, but aid officials tell us Italy will
not commit to new assistance for Iraq. End summary.



2. (SBU) Visiting A/S Fried discussed reftel points with
Giovanni Castellaneta, Diplomatic Advisor to Prime Minister
Berlusconi and raised the need for Italy to fulfill its aid
promises and unfreeze Iraqi assets. Castellaneta did not
reply directly.



3. (U) Econoff also delivered reftel points to Federica
Ferrari-Bravo, Office Director for the Middle East at the
Directorate General for Development Cooperation at the
Ministry of Foreign Affairs. Ferrari-Bravo stated that
Foreign Minister Gianfranco Fini plans to head Italy's
delegation to the Brussels conference accompanied by MFA
Director General for the Middle East and Mediterranean
Riccardo Sessa.



4. (SBU) Ferrari-Bravo noted that the Brussels conference
will not be a pledging conference, and she indicated the GOI
will not announce new aid initiatives. Italy, she predicted,
will reaffirm its intention to assist with the reconstruction
of Iraq according to its existing Madrid pledge and to
"consider other needs, if necessary." She said the GOI will
give a more specific update on disbursements of its Iraq aid
at the upcoming meeting of the International Reconstruction
Fund Facility for Iraq in Amman. In response to the specific
suggestion in reftel that Italy provide additional water and
demining assistance, Ferrari-Bravo stated Italy is already
fulfilling its obligations in those areas.



5. (C) Roberto Ciciani, Director of the Office of
Money-Laundering/Illicit Financial Crimes (which also has
jurisdiction over the Iraqi assets issue) at the Finance
Ministry told Econoff June 15 that roughly six million
dollars in frozen Iraqi assets held in accounts at UBAE Arab
Italian bank should be repatriated to Iraq in the coming
weeks. The Italian Financial Security Committee rejected May
12 UBAE's request to unfreeze, but not repatriate, the
assets. Ciciani said that the remaining assets (Note: He did
note give an exact figure but we estimate $60 million. End
note.) held in the name of Iraqi institutions covered by U.N.
Resolution 1483, have claims against them in Italian courts
that pre-date the effective date of the UN Resolution. In
almost all cases, the claims against the frozen assets exceed
the value of the assets frozen. Ciciani said the Financial
Security Committee was certain that there are no "secret
Iraqi accounts" in Italy. After the UBAE transfer, Ciciani
believes little, if any, of the additional funds could be
repatriated to Iraq because of existing liens against these
funds.



6. (C) Comment: The GOI is very reluctant to take on
additional assistance obligations, or even to commit to
accelerating disbursements of its Madrid pledge, for fear
that it will be unable to deliver. With Italy now in
recession, and on a course to exceed once again the EU's
three-percent budget deficit ceiling, Italy's foreign aid
budget may again face mid-year "spending freezes" as in 2004.
Italy views the Brussels conference as an important
opportunity to improve donor coordination and discuss
GOI-funded reconstruction projects already underway, but we
expect the Italian delegation will provide few if any
"deliverables." End comment.

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2005ROME02051 - Classification: CONFIDENTIAL