Identifier
Created
Classification
Origin
06PARIS1293
2006-03-01 17:40:00
CONFIDENTIAL
Embassy Paris
Cable title:  

SYRIA: FRANCE NOT INCLINED TO BLOCK EIB WATER LOAN

Tags:  PREL EAID EFIN SY LE FR 
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This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L SECTION 01 OF 02 PARIS 001293 

SIPDIS

STATE FOR NEA, EUR/WE, EUR/ERA (CHASE) AND EB

E.O. 12958: DECL: 03/01/2016
TAGS: PREL EAID EFIN SY LE FR
SUBJECT: SYRIA: FRANCE NOT INCLINED TO BLOCK EIB WATER LOAN

REF: A. STATE 29000

B. PARIS 1188

C. 05 PARIS 8673

Classified By: ECON Counselor Kenneth Merten for reasons 1.4 (b) and (d
).

C O N F I D E N T I A L SECTION 01 OF 02 PARIS 001293

SIPDIS

STATE FOR NEA, EUR/WE, EUR/ERA (CHASE) AND EB

E.O. 12958: DECL: 03/01/2016
TAGS: PREL EAID EFIN SY LE FR
SUBJECT: SYRIA: FRANCE NOT INCLINED TO BLOCK EIB WATER LOAN

REF: A. STATE 29000

B. PARIS 1188

C. 05 PARIS 8673

Classified By: ECON Counselor Kenneth Merten for reasons 1.4 (b) and (d
).


1. (C) Summary. French officials continue to suggest that
France will not block the proposed EIB loan to support water
projects in Syria. In our discussions with senior Elysee,
MFA and Finance Ministry officials, they have been quick to
note that Syria is not under EU sanctions, that the water
project is humanitarian in nature, and that EIB decisions are
taken by representatives of EU member states, French
opposition alone could not stop approval of the loan. While
GoF officials continue to discuss the water sector loan
internally and have suggested an EIB postponement may be
possible, our overall impression is that France will support
this loan, largely on humanitarian grounds. End Summary.


2. (C) Pol Min Couns and PolOff discussed reftel points in
detail with MFA A/S-equivalent for Middle East/North Africa
Jean-Francois Thibault February 28, after first raising the
issue with Thibault February 23. Pol M/C urged
reconsideration of the EIB loans for Syria and stressed the
contradictory message sent by such loans in the midst of
continued SARG destabilization of its neighbors and
intensive, U.S.-French-led efforts to isolate Syria and press
it to meet its UN obligations. Thibault conceded that there
was a contradictory political message sent by such loans and
assured Pol M/C that the GoF was taking U.S. objections into
consideration. At the same time, he gave no indication that
France would seek to block the EIB loans, and instead
stressed the independence of the EIB as an institution and
its tendency to review projects by economic and financial
criteria only.


3. (C) Thibault also stressed the humanitarian character of
the water sector project, noting that it would assist poor
populations in communities south of Damascus and two
Palestinian refugee camps. The fact that projects involved
in the three proposed EIB loans to Syria (telecom, energy,
water sector) dated back to 2001, in Thibault's view, was

another factor favoring EIB approval. According to
Thibault, the GoF wanted to avoid the impression of
sanctioning the Syrian people or a "logic of generalized
sanctions" against Syria. Syria remained a participant in
the Barcelona Process and the EU "neighborhood policy," even
though the EU-Syria Association agreement remained frozen,
and the EU had not taken any decisions to sanction Syria.
(Septel will report further on Thibault's expressed reticence
on Syria sanctions, in response to the Syria/Lebanon white
paper conveyed in State 29048.) At the same time, Thibault
suggested that there might be a possibility that the EIB
Board would postpone a decision on the proposed water-sector
loan during its upcoming March 6 meeting, if the EU at 25
failed to reach a common decision. (Note: MFA and Elysee
officials told us the EIB board will review the proposed
Syria loan March 6, not March 3, as reported ref A. End
note.) In the end, he declined to speculate how France
would vote at the EIB board meeting, and noted that the GoF
would be represented by Finance Ministry officials; the MFA,
though seeking greater input into decision-making, did not
have the final say.


4. (C) In a separate conversation with Pol M/C February 24
(ref B),Presidential Middle East/Americas advisor Dominique
Boche stressed that the EIB loans remained a European
decision, and suggested further follow-up with Thibault. In
a follow-up discussion March 1, Boche concluded that the
water sector loan was humanitarian in nature, and the funds
would not be easily misused by the regime. When asked about
a possible postponement, Boche gave no indication that France
would pursue such an outcome. Poloff heard a less helpful
response from MFA Cabinet Advisor for the Middle East/UN
issues Christophe Guilhou, who suggested that, in the absence
of EU sanctions, the EU should not seek to punish the Syrian
people by cutting off assistance projects of public benefit.


5. (C) On 27 February conversation after reviewing the U.S.
points on the loan, the Finance Ministry's Gerard Belet
reminded Econ Couns that Syria was not subject to EU or
French sanctions, that the water project was humanitarian in
nature, and that France alone would be relatively powerless
to stop approval of the loan, even if they were inclined to
oppose it. He added that the decision would be "prepared by
the EIB services" and that the country representatives who
would decide "usually do what the services recommend." Econ
Couns explained that the project perhaps had merits for the
Syrian people but that this was a critical time in the
international community's relations with the Syrian regime.
The time was not right to send a contradictory signal that
could be interpreted by the Syrians as "business as usual."
Econ Couns suggested that French support for a postponement
of the decision would be a step in the right direction.
Belet took note and admitted that interagency discussions
between "quite senior" officials at the Finance and Foreign
Affairs Ministries were ongoing and that no final position
had yet been taken. Econ Couns said he would contact Belet
again on 2 March to learn the conclusions of the GOF
deliberations and reiterated that the "moment is not right"
to give a positive and contradictory signal to Syria by
approving the loan.
Please visit Paris' Classified Website at:
http://www.state.sgov.gov/p/eur/paris/index.c fm

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