WAR IN LEBANON; WAR ON TERRORISM; ARGENTINE NUCLEAR PLANS

UNCLAS BUENOS AIRES 001929

SIPDIS

STATE FOR INR/R/MR, I/GWHA, WHA, WHA/PDA, WHA/BSC,
WHA/EPSC
CDR USSOCOM FOR J-2 IAD/LAMA

SIPDIS

E.O. 12958: N/A
TAGS: KPAO OPRC KMDR PREL MEDIA REACTION
SUBJECT: WAR IN LEBANON; WAR ON TERRORISM; ARGENTINE NUCLEAR PLANS
AND USG SUPPORT FOR THEM; USTR SCHWAB'S STATEMENTS ON GLOBAL TRADE;
08/25/06



1. SUMMARY STATEMENT

Today's major international stories include the implications of the
war in Lebanon; the ongoing war on terrorism; USG's support for
Argentina's nuclear program; and USTR Susan Schwab's statement that
the US does not believe it should revive global commercial talks
through a unilateral proposal to open US markets.


2. OPINION PIECES AND KEY STORIES

- "Peace should be signed with the enemy"

Left-of-center "Pagina 12" carries an opinion piece by political
analyst Alejandro Horowicz, who writes (08/25) "... The conflict in
the Middle East does not have a military solution. Exterminating the
enemy is only possible when every falling combatant cannot be
replaced. On the contrary, this policy not only does not exterminate
him but recruits new militants that are increasingly convinced that
the armed fight is the only choice available.

"The Israeli government is implementing an inconsistent policy. By
putting an end to the fight in Lebanon it implicitly admits that
there is no military solution available, but at the same time it
does not believe that there is a political solution. In this way, it
rejects the possibility that peace can be attained.

"Peace can only be attained by warring states... Peace should be
signed with the enemy. Otherwise, war becomes genocide.

"The greatest danger for the existence of the State of Israel is its
current government."

- "In defense of freedom"

Daily-of-record "La Nacion" (08/25) carries an opinion piece by
Marcelo Birmajer, writer, who writes (08/25) "... Terrorists know
exactly what they are doing. If they do not manage to massacre the
largest number of people, which is their main purpose, they are
satisfied with having imposed on us their main political objective -
the restriction of our public liberties.

"Lastly, this is a confrontation between two systems - on one hand,
the imperfect liberal democracies, with their freedom of
international circulation, their liberties and public guarantees,
which prevail in most Western Europe, most Eastern Europe, South
America and North America. On the other hand, the perfect
totalitarian regimes, just like the Iran of Khomeini and his
successors, the ended Afghanistan of the Taliban, or the warring
Syria of Assad.

Unluckily, it is not perceived that most current intellectuals who
today enjoy their public liberties in the jeopardized parts of the
world where these liberties are still in force have joined a
consistent clamor against this threat."

- "The US supports the Argentine Government's nuclear program"

Mariano Obarrio, political columnist of daily-of-record "La Nacion,"writes (08/25) "Yesterday, the US Embassy notified that the USG
approves of and supports the nuclear program announced by the Nestor
Kirchner administration because it complies with international
treaties. Nonetheless, the USG expressed its wish that when
'deepening its plan,' Argentina makes sure that its actions will be
in alignment with non proliferation principles.

"The nuclear energy program entails the completion of nuclear
centrals aimed at increasing the supply of electric energy.

"The US Embassy's spokesperson, Mara Tekach, asserted that 'the US
strongly promotes the extensive use of clear, innocuous and safe
nuclear energy.' And she added 'in this framework, we support
Argentina's decision to make progress on its nuclear program.'

"Nevertheless, the USG added 'we hope that in deepening its nuclear
energy program, Argentina will make sure that its actions are in
alignment with the sound non proliferation credentials it has
exhibited so far.'

"This last paragraph could well be interpreted as a warning from
Washington on an issue that the White House considers a foreign
policy strategic top priority. In any event, it will be a key
element in the US-Argentine bilateral relationship.

"In recent times, this relationship has been stalled, regardless of
Kirchner's plans to visit the US by mid-September to attend the UN
General Assembly.



"The USG closely follows nuclear energy programs all over the world
due to latent threat posed by some countries that could decide to
manufacture the atomic bomb. It also closely follows the
increasingly close ties between Argentina and Venezuelan President
Hugo Chavez, an ally of Iran. Iran is precisely the country that has
been most questioned by Washington due to its nuclear program.

"The Government's plan to produce more nuclear energy only has one
main reason - the completion of Atucha II by 2010 with a total
investment of 1.8 billion dollars.

"... Tekach said that Argentina 'is a strong international partner
and ally' on non proliferation issues and the promotion of peaceful
uses of nuclear energy.

"She emphasized that Argentina ratified the Non Proliferation
Treaty, is a member of the Group of Nuclear Suppliers and supported
the Treaty of Tlatelolco. Tekach asserted that Argentina 'is one of
the ten countries that have a working enriched uranium factory in
the framework of the USG policy.'"

- "The US asks for more guarantees in exporting nuclear technology"

Daniel Santoro, political columnist of leading "Clarin," writes
(08/25) "The US has asked the (Argentine) Government to 'make sure'
that the decision it made to restart the production of enriched
uranium... will not contribute to transferring this technology to
third countries, in a veiled reference to Venezuela.

"... In addition to completing Atucha II nuclear central, one of the
points of the plan is reactivating the enriched uranium program.
This is dual technology - it can be used to produce electric energy,
as wanted by the Argentine Government, but it can also be used to
manufacture an atomic bomb, as the US suspects Iran is doing. An
Embassy source underscored that 'Argentina is not Iran.'

"... The head of the Foreign Ministry Nuclear Issues Division, Elsa
Kelly, said yesterday that 'the US may rest assured that Argentina's
political vocation has always been to honor non proliferation
principles.'

"In contrast to the Menem administration, the current Argentine
government is attempting to maintain Argentina within the select
club of ten countries manufacturing enriched uranium. Perhaps, it
did not take into account that the US closely follows every
technological step that could lead to the manufacture of the bomb.
The best response to this is Argentina's history as a transparent
and pacifist country."

- "Venezuela, a recurring concern for Washington"

Walter Curia, columnist of leading "Clarin," writes (08/25) "...
Argentina's announcement that it would re-launch its nuclear program
coincided with the Bush administration's rejection of an offer from
the Iranian government to negotiate the extent of its nuclear
program. This was an unhappy coincidence.

"The US Embassy spokesperson, Mara Tekach, advanced the content of a
USG statement about a cautious request for guarantees on the final
purpose of the civil program, and she dismissed 'frictions' about
the issue.

"The US Embassy's release clearly states that Washington 'supports'
the Argentine decision to make progress on its nuclear development
plan. With the same transparency, it assumes its 'opposition' to the
'dissemination' of said technology. It did not need to mention
Venezuela, which is currently an important commercial partner of
Argentina."

- "The US will not make a new proposal on (farm) subsidies"

Business-financial "Ambito Financiero" reports (08/25) "According to
USTR Susan Schwab, the US does not believe it should revive global
commercial talks through a unilateral proposal to open US markets
even further.

"The USG official said that the US still expects to reach an
agreement on a new world commercial pact before the White House's
fast track authority expires in July 2007.

"However, Schwab also made it clear that the US does not intend to
revive stalled negotiations through a unilateral offer. Schwab said
'it is quite clear that the US cannot and will not be able to revive
(negotiations) on its own.'


"The USG official said that, realistically speaking, a deal should
have been reached last month in order to honor the July 2007
deadline. 'We obviously did not manage to reach a deal, but we have
not dismissed it.'

"Schwab added that 'trying to revive the Doha Round is imperative'
and explained that this is the key to alleviating poverty and
increasing world economy growth."


3. EDITORIALS

- "The challenges posed by the energy crisis"

An editorial in daily-of-record "La Nacion" reads (08/25) "The signs
of the energy crisis started to become obvious last summer... In
order to face this chronic problem, the Government has implemented a
series of projects, one of which is that of completing Atucha II
works.

"... It is quite logical that Argentina deepens the development of
its nuclear energy for electric generation. However, it is necessary
to guarantee that it will be made with peaceful use and that every
progress in this field will not jeopardize the environment.

"... The completion of Atucha II was also announced at a cost of 1.8
billion dollars. It is expected to be working by 2010...

"The electric crisis makes it imperative to change the price policy
and the regulations imposed on the sector. The consequences of the
mistakes that have already been made seem inevitable. However, the
longer the delay in implementing changes, the greater the costs and
the more difficult the solution."

- "The nucleus of the question"

Liberal, English-language "Buenos Aires Herald" editorializes
(08/25) "Perfect timing as always from the Nestor Kirchner
administration - just when most of the world is alarmed by the
nuclear antics of such rogue states as Iran and North Korea, this
government goes ahead and announces a nuclear program with only an
insistence on 'peaceful uses' to save it from charges of total
autism. Brazil's problems in recent years with the International
Atomic Energy Agency (IAEA) show that even a vast distance from the
fault lines of global conflict is no guarantee against outside
scrutiny.

"Yet Kirchner's nuclear drive is largely fuelled by domestic needs,
both genuine and political... There can be no doubt that the
government is taking energy shortages seriously with this plan but
it also needs to answer some questions if it wishes to banish any
suspicions of a new slush fund in the making. We are given to
understand that the plan entails the investment of 3.5 billion
dollars over the next eight years in pursuit of five specific
objectives - namely, lengthening the Embalse nuclear reactor's
useful life by a further 25 years, expanding heavy water production
at Arroyito, completing the construction of the Atucha II nuclear
reactor by 2010, carrying out feasibility studies for a possible 4th
reactor... and renewing the uranium enrichment program. The first
two objectives are to cost 600 million dollars while a similar sum
(1.8 billion pesos) was announced for the completion of Atucha II.
This leaves a huge grey area of over two billion dollars for a
possible 4th reactor and uranium enrichment - the former might well
arouse suspicions of a new Yacyreta at home while the later could
stir even worse anxieties abroad."

To see more Buenos Aires reporting, visit our
classified website at:
http://www.state.sqov.gov/p/wha/buenosaires

MATERA