WITH A WARY EYE ON RUSSIA AND THE MIDDLE EAST,

C O N F I D E N T I A L SECTION 01 OF 02 ROME 004155

SIPDIS

E.O. 12958: DECL: 12/23/2015
TAGS: ECON ENRG PGOV PREL KDEM SA IR IS IT IQ RU
SUBJECT: WITH A WARY EYE ON RUSSIA AND THE MIDDLE EAST,
ITALY CONSIDERS ENERGY SELF-SUFFICIENCY

Classified By: Ambassador Ronald Spogli for Reasons 1.4 (b) and (d)


1. (SBU) Summary. Italy's Productive Activities Minister
says Italy and the EU are too dependent on Russian energy,
and that truly developed countries should be self-sufficient
in energy. Italy is actively pursuing alternative energy
sources, such as biomass fuel, hydrogen energy, and solar
power. Minister Claudio Scajola criticized recent statements
by Iranian President Ahmadinejad and noted U.S. policies have
led to positive changes in the Middle East. The Minister, a
close political ally of Prime Minister Berlusconi, hopes for
continued cooperation with the United States on a broad range
of issues, including the F-35 Joint Strike Fighter. End
summary.

Urban Energy Farm
--------------


2. (SBU) Scajola told the Ambassador December 21 that he is
"totally preoccupied with the cost of energy." He said he is
actively pursuing alternative energy sources, such as biomass
fuel, hydrogen energy, and solar power. Later this month, he
will inaugurate a solar energy farm on the roof of his
ministry in Rome, to promote solar power. Scajola emphasized
that Italy must join G-8 countries that have taken a second
look at nuclear power, which he described as climate-friendly
energy.


3. (C) On energy security, Scajola said Italy is too
dependent on Russian oil, "but better to depend on the
Russians than the Middle East." Scajola sees this dependency
as an EU problem, with "Europe as a whole overly-dependent on
Russian energy." Scajola said "truly developed countries
must be independent in energy."

Optimistic on the Middle East, not Saudi Arabia, Iran
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4. (C) The Ambassador thanked Scajola for Italy's support
in the Global War Against Terrorism, and pointed specifically
to Italian troop deployments in Iraq and Afghanistan.
Scajola responded that U.S. Middle East policy has positively
changed the region. "Iraq is much better than before." He
expressed hope that the outcome of Iraq's December 15
elections will be a unified government, not divided along
ethnic lines. "We don't want Iraq to dissolve."


5. (C) Scajola, who recently returned from Saudi Arabia,
commented that the Kingdom must still open its society. He
noted that Saudi Arabian society is not as open as others in
the region, such as Lebanon, and expressed concern that lack
of openness could lead to political instability and
insecurity in the energy supply.

Concerned about Israeli Military Action
--------------


6. (C) Scajola pointed to Iran's WMD pursuit and Iranian
President Mahmoud Ahmadinejad's denial of the holocaust and
anti-Israel statements as further reasons for concern.
Scajola expressed hope that Ahmadinejad's electoral victory
was a result of low turnout among moderate Iranians and that,
by extension, his statements do not reflect the views of the
silent majority. Scajola said that Italian businessmen had
urged the GOI to continue to allow Italian firms to engage
customers in Iran.


7. (C) Noting that "the solution to challenges posed by
Iran is not military," Scajola claimed that a major problem
in the region is that Israel may choose to take matters into
its own hands, to the detriment of the entire region.
Scajola did express admiration for Israeli Prime Minister
Sharon, and condemned Palestinian suicide bombers as symbolic
of economic despair. He views economic growth and
Palestinian development as a palliative to relations between
Israeli and Palestinians.

EU Budget Deal a Win For Italy; EU Generational Divide
-------------- --------------


8. (C) Scajola said the recent EU budget agreement was a
win for Italy and important for the EU's future. He
commented that many citizens, especially the young, view the
EU as part of "the myth of Europe." His generation, which
remembers the effects of World War II, the Prague uprising,
and President Kennedy's solidarity with Europe, still retains
"the idealism of Europe." The younger generation does not
appreciate the advantages of the EU, in part, because young
people are not familiar with the dangers of a divided Europe.
"In the past, many wars started within Europe." That said,
Scajola admitted that EU bureaucracy "is a brake" on economic
dynamism.
U.S. - Italy Relations
--------------


9. (SBU) Throughout the meeting, Scajola took lengths to
express Italian solidarity with the United States on energy
policy, the Middle East, foreign policy generally, and
defense policy. In his view, the U.S. - Italy relationship
is one of historic collaboration. Scajola expressed hope for
continued collaboration on energy policy and in aerospace,
especially through the Joint Strike Fighter program to which
Italy has committed over one billion dollars.

Italian Elections
--------------


10. (U) Scajola closed with an analysis of the April 2006
national elections. Admitting that "we'll know more in a
month," Scajola unsurprisingly predicted a victory for his
center-right coalition. Scajola said the key issue in the
election is the economy, which depends upon highways,
railways, and energy to grow. These issues help the right
because they create "divisions in the house" of the
center-left, especially between the pragmatic centrists, who
understand the need for a reliable infrastructure and a
secure energy supply, and members of the "no-global" movement
and environmentalists.

Comment
--------------


11. (U) Scajola was well-informed, candid, and eager to
engage the United States on a variety of political and
economic issues. Regardless of the outcome of April's
elections, Scajola's keen mind and engaging personality
ensure that we will continue to seek opportunities to hear
his views on issues of mutual concern or interest. Scajola
will travel to the United States before July, which will give
us the opportunity to have him meet Washington policy-makers
to reinforce his positive disposition toward us.

Biographical Note
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12. (U) A biography of Minister Scajola can be found on
Embassy Rome's SIPRNET site,
http://www.state.sgov.gov/p/eur/rome. Scajola is an avid
outdoorsman who enjoys hiking in the Dolomites, near his
home. He is married with two children. He and his family
recently returned from a vacation in the Libyan desert, which
he described as "the most beautiful in the world," and "a
great place to go if you don't want to see other people."
SPOGLI