SPAIN ON EU-LAC SUMMIT: "IT COULD HAVE BEEN WORSE"

C O N F I D E N T I A L MADRID 001260 SIPDIS SIPDIS E.O. 12958: DECL: 05/18/2016 TAGS: PREL SP SUBJECT: SPAIN ON EU-LAC SUMMIT: "IT COULD HAVE BEEN WORSE" REF: A. MADRID 1231 ¶B. MADRID 1107 ¶C. SANTIAGO 1042 Classified By: PolCouns Kathy Fitzpatrick for reasons 1.4 (b) & (d). ¶1. (C) SUMMARY. In a broad discussion on May 17 that included Spain,s plans for the EU review of Cuba policy in June, MFA DG for Latin America Javier Sandomingo told Polcouns that Spain was satisfied with the outcome of the recent EU-Latin America/Caribbean (EU-LAC) Summit in Vienna. He said that the Summit provoked good discussions on increasing ties between the two regions without "serving as an ideological platform for any of the participants.". Sandomingo said that President Zapatero chose to meet with Bolivian President Morales in Vienna (after lengthy consideration) in order to encourage him towards moderation, because Spain won't close the door in the face of one of the poorest countries in Latin America, and to counter Spanish opposition accusations that Zapatero had allied Spain with Chavez and Castro at the expense ties with moderate leaders. He praised new Chilean President Bachelet and called her visit to Spain a PR event in which Spain reveled in the chance to celebrate a good Latin American government. On Peru, Sandomingo said that Spain hopes to see Alan Garcia become an effective counterweight to Hugo Chavez. Polcouns suggested that we think about timing for another US-Spain high-level working group meeting on Latin America. Sandomingo agreed that with so much happening in Latin America, it is critical for the US and Spain to keep talking about the issues and noted that September's UNGA might be the right setting for the next high-level meeting on Latin America. END SUMMARY. -- THE VIENNA SUMMIT -- ¶2. (C) Polcouns met with MFA DG for Latin America Javier Sandomingo on May 17 about a range of Latin America issues. Sandomingo lamented that most Spanish press coverage of the EU-LAC Summit in Vienna was unfairly negative. He said that not only was the timing of the Summit important, given recent problems within the Andean Community and Mercosur, and the need to press Central American integration, but the outcomes were much better than they might have been. According to Sandomingo, despite the ruckus that Hugo Chavez has created within the Andean Community, the EU was clear at the Summit that the door is open to begin negotiations on a trade agreement right away, whether with three countries or four. ¶3. (C) He also pointed to two Summit outcomes that should strengthen EU-LAC ties. First, as part of an accord that Spain signed with Chile regarding cooperation in Haiti, they will try to get the EU, Caricom, and other regional institutions more involved in developing and implementing development projects. Second, they will proceed with creation of a EU-Caribbean-Latin American foundation, modeled on CEF, that would provide a more permanent link. Sandomingo stressed that Spain's hope is to strengthen ties through existing institutions, not to create new institutions. Sandomingo also took pains to describe how bad the Summit might have been. He said that it was very well attended, and that no one was able to hijack the final declaration for propaganda purposes (NOTE: A reference to Cuba and Venezuela's performance at last fall's Iberoamerican Summit in Salamanca Spain. END NOTE). -- BOLIVIA -- ¶4. (C) Regarding President Zapatero's meeting with Bolivian President Morales in Vienna, Sandomingo said that the GOS thought hard about whether to accept the meeting, given Bolivia's recent posture towards Spain and Spanish companies (ref A & B). He said that Bolivia has shown poor form in opting to use brinksmanship for every initiative it pursues, but the GOS understands the domestic political necessities related to the upcoming constituent assembly in Bolivia that are driving Morales to take these actions. The GOS finally decided that taking the meeting was worth the trouble since it would provide Zapatero with another opportunity to try to convince Morales to make a deal with Repsol and other Spanish companies that have been affected by recent GOB actions. Zapatero made the case that the Repsol and airports issues need to be resolved properly or Bolivia will lose foreign investment and much-needed technical assistance. Sandomingo emphasized that Spain maintains dialog with all countries, and particularly is not going to isolate one of Latin America's poorest countries. He also said that Spain does not see any alternative to Evo Morales right now. Responding to an observation of increased Cuban activism in Bolivia, Sandomingo said he knew newly-designated Cuban Ambassador to Bolivia Rafael Dausa quite well and, unfortunately, expected him to be an effective promoter of Castro's interests in Bolivia. -- VENEZUELA AND PERU -- ¶5. (C) Sandomingo was more upbeat on Venezuela, where he saw a growing number of political alternatives to Chavez. He said that the opposition, though still very weak, is beginning to better organize itself. Sandomingo observed that Chavez's obvious failure to deliver improved social and economic conditions despite years of high oil revenues was breeding discontent among ordinary Venezuelans, a frustration that the opposition could channel. He also noted that Chavez's intervention in the elections in Peru and Mexico had backfired and suggested that Venezuelan's open support for Bolivia's nationalization of the energy sector had drawn the ire of a previously complacent Brazilian government. Sandomingo said he was convinced that Alan Garcia had purposely drawn Chavez into the Peruvian electoral campaign, where Chavez's comments had rebounded much to Garcia's benefit. He called Alan Garcia a better potential president than Lourdes Flores because Garcia can be an effective leftist counterweight to Chavez. Sandomingo said that Spain hopes that Garcia will be new and improved since his last term, and sees him in a Tabare Vasquez mode. -- CHILE -- ¶6. (C) Regarding the visit of Chile's new President Bachelet, Sandomingo said that what was intended as a working visit turned into essentially a state visit and a PR event. He said that Spain and Chile have no bilateral problems at the moment and Spain was enthusiastic to celebrate Bachelet's type of leadership. He complained that the opposition Popular Party (PP) and some media constantly accused Spain of leading a "Cuba, Venezuela, Bolivia axis" when in fact Spain's closest partners in the region were Chile, Brazil, and Mexico, and to a lesser extent Colombia and Argentina. On the UNSC elections, Sandomingo said that MFA had put forward a clear point for Zapatero to present to Bachelet, emphasizing that Spain would vote for Guatemala, not Venezuela (ref C). -- CUBA -- ¶7. (C) Polcouns raised the June EU discussion on Cuba, asking if Spain planned any new initiative. Sandomingo said that he was aware of rumors that Spain has another initiative up its sleeve to seek improved relations with Cuba, but insisted that it does not. He said that Spain and some other EU members would like to gain Cuba's agreement to participate in official human rights discussions with the EU, but there is no sign of Cuba's willingness to do so. Nor was there any sign of Cuba's readiness to release political prisoners or otherwise improve political conditions, and thus no reason for Spain to call for a shift in EU policy. Sandomingo did say that Spain would resist efforts to re-impose the 2003 restrictive measures and since, in the Zapatero Government's view, direct conflict with Castro would not improve political conditions and would undermine Spain's long-term strategy in Cuba. Overall, he viewed the Castro regime as satisfied with its current economic and political situation, and thus unmotivated to negotiate with the EU or anyone else. -- URUGUAY -- ¶8. (C) Finally, Sandomingo said that Uruguayan President Tabare Vasquez did not ask for EU or Spanish assistance in dealing with Argentina. Sandomingo said that he had just been in Uruguay, and noted how high the dislike of Argentina is there at the moment. He said that Argentine President Kirchner had raised the case with Spanish President Zapatero as an environmental issue, but Zapatero "knew that Uruguay is obviously right legally" and did not give him any support. -- COMMENT -- ¶9. (C) The Zapatero government clearly is seeking to counter/avoid PP criticism that it has courted the likes of Chavez and Morales to no avail. In fact, the GOS outreach has not resulted in avoiding huge detriment to major Spanish national interests. This may help us as we seek to temper Spanish moves related to Cuba and make them more willing to be work with us to balance the image that they have supported radicals in the region. We want to continue the high-level working group; September could be the right timing for a more formal session but we will continue to encourage informal ties in between. MANZANARES