AUSTRIA: REVIEW OF LIBERTAD ACT SUSPENSION

C O N F I D E N T I A L VIENNA 003746

SIPDIS

DEPT FOR WHA/CCA AND EUR/AGS

E.O. 12958: DECL: 11/28/2015
TAGS: PREL ETRD ETTC CU AU
SUBJECT: AUSTRIA: REVIEW OF LIBERTAD ACT SUSPENSION

REF: STATE 207359

Classified By: Economic-Political Counselor Gregory E. Phillips for
reasons 1.5 (b) and (d).

Policies to Advance Democracy and Human Rights
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1. (C) Andreas Melan, the MFA's Latin America
DAS-equivalent, told us November 23 that Austria continues to
promote human rights and democracy issues bilaterally and in
international fora. He stressed that the GoA based its Cuba
policy on the EU's two points of focus: intensifying contacts
with civil society and engaging GoC officials on democracy
and human rights. Melan admitted that engagement with the
GoC had not yielded results, particularly in regards to the
release of political prisoners. Nevertheless, Melan noted
that there is EU-wide agreement that senior-level Member
State officials must raise democracy and human rights points
during meetings with GoC interlocutors.


2. (C) Melan said the GoA believed it was important to
expand contacts with civil society beyond the traditional
circle of political dissidents. The Church, in Melan's
opinion, was a potentially powerful force in civil society,
which could further human rights. Melan noted that the EU
needed to maintain a fine line in its support for dissidents.
Too much overt support to a particular group would attract
unwanted attention from the GoC, which would inevitably
weaken or compromise the group's effectiveness. Melan
claimed the EC was preparing a study that would recommend new
approaches to financing Cuban civil society informally.


3. (C) According to Melan, the Austrian Embassy in Havana
canceled its national day reception on October 26. Melan
said the GoA favored a consensus approach within the EU
regarding invitations for national days. The GoA agreed with
the UK Presidency's recommendation to cancel national day
celebrations unless Member States invited both GoC and
opposition officials.


Austria's Economic Relations with Cuba
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4. (U) Total trade with Cuba in the first six months of 2005
amounted to Euro 3.0 million. Austrian exports to Cuba
declined by 39.2% during the period, while imports from Cuba
increased by 60.4%. Trade with Cuba accounted for less than
.01% of Austria's total trade. Major exports in 2004
included machinery and vehicles and manufactured goods.
Principal imports were tobacco and beverages, as well as
foodstuffs.


5. (SBU) Before 2003, there was no Austrian FDI in Cuba
apart from a small brewery in Havana (Salm Brau). Since the
signing of the Austrian-Cuban Agreement on Investment
Protection in 2001, Cuba has actively lobbied to attract
Austrian investment in the tourism/hospitality sector.
18,000 Austrians visited Cuba in 2003 (latest statistics
available). LaudaAir, a subsidiary of Austrian Airlines,
flies weekly to Cuba. At the end of November, a joint GoA
and GoC governmental commission will convene to discuss trade
and investment problems.


6. (SBU) An Agreement on Investment Protection and an
Agreement on Economic, Industrial, and Scientific Cooperation
are in force. The Austrian export-import entity, the Control
Bank, offers short-term export credit guarantees of up to
Euro 500,000.


7. (C) Embassy Vienna knows of no Austrian direct investment
that might be subject to Libertad Act Title III. We have no
information regarding any new or contemplated projects that
might result in litigation under the Libertad Act.


Waiver for Austria in the U.S. National Interest
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8. (C) In post's assessment, given Austria's quite limited
current or potential investment in Cuba, revoking the Title
III waiver for Austria would likely negatively affect
bilateral relations at an important moment, as Austria
assumes the EU Presidency in January 2006. A termination of
the waiver would also make our cooperation on promoting human
rights in Cuba in international fora more difficult. We
defer to USEU for an analysis of how not renewing the
suspension of the Libertad Act Title III for an EU Member
State might affect overall U.S.-EU relations.
VAN VOORST