ITALY: IRAN SANCTIONS UNAVOIDABLE, BUT ESCALATION

C O N F I D E N T I A L SECTION 01 OF 03 ROME 003132

SIPDIS

SIPDIS

E.O. 12958: DECL: 11/21/2016
TAGS: PGOV XF IR LE UNAUS KNNP IT
SUBJECT: ITALY: IRAN SANCTIONS UNAVOIDABLE, BUT ESCALATION
UNPREDICTABLE

REF: ROME 2946

ROME 00003132 001.2 OF 003


Classified By: Political M/C David D. Pearce for reasons 1.4 (B) and (D
).

Summary
--------------


1. (C) MFA Middle East Director Cesare Ragaglini says there
is now no choice on the Iran nuclear issue but to move
forward with sanctions. This is a matter for some concern,
though, because it will set in motion a process of escalation
whose outcome is unpredictable. We should also be looking at
a strategy for engagement. The key issue for Iran is not the
nuclear one, according to Ragaglini; it is U.S. recognition
and engagement. The Middle East director told visiting NEA
DAS Gray that movement on the peace process (MEPP) will be a
priority for the GOI during its tenure on the UNSC. However,
he said, the Italians are skeptical of the so-called
French/Spanish initiative because any serious effort will
require EU-wide concurrence, not just the support of a few
countries. Furthermore, it will have to be carefully
coordinated with the U.S., Israel, and the moderate Arab
countries. Ragaglini said it was essential that the UNIFIL
mission in Lebanon be a success, because it was the first
time Israel had accepted such a force, and this could be an
important precedent for future missions in the region. He
said PM Prodi had called Syrian President Asad to press him
to refrain from action to destabilize the Siniora government.
Bashar disingenuously said Syria had withdrawn its troops
from Lebanon, and thus had limited means to influence the
situation. Nevertheless, Ragaglini said, Prodi made clear
Italy's support for the Siniora government, and also that it
considered this moment an important test of Syrian
intentions. End Summary.


Iran: Looking for U.S. Recognition, Engagement
--------------


2. (U) Visiting NEA DAS Gordon Gray and NEA RA Deputy
Director Christine Elder met November 17 with Italy's new
Middle East Director General, Cesare Ragaglini. Ragaglini
was accompanied by Near East office director Luciano Pezzotti
and deputy Near East Office Director Daniele Bosio. Pol M/C
and poloff accompanied Gray.


3. (C) Ragaglini, who has served in both Iran and Iraq,
agreed with Gray that the only option with Iran at this point
was to move forward toward sanctions. However, this will
also start a process of escalation whose exit is
unpredictable. While the initial sanctions set may be light,
once we go down this path the international community will
eventually have to move on to tougher measures. We need to
reflect very hard on this, and where it will go, and be very
clear what goal we hope to achieve. Italy wished to prevent
Iran from becoming a nuclear power, but the nuclear issue was
not the only issue to take into account when dealing with
Iran. In Ragaglini's view, the EU-3 are ultimately hampered
in what they can achieve with Iran because they do not have
the ability to deliver to Tehran what it wants most, and what
it is really looking for -- recognition, respect, and
engagement by the U.S.


4. (C) Gray pointed to the Secretary's May 31 offer to sit
down together with the Iranians, but they had declined the
offer. Ragaglini agreed, and said the EU-3 (and Italy) had
not helped sufficiently in explaining to the Iranians the
significant implications of that offer. We should look at a
strategy for engaging Iran but whatever our conceptual
differences, it would be essential for success that we stick
together (Comment: by "we", Ragaglini appeared to mean the
U.S. and EU. End Comment). Gray cautioned that any change
of course would be perceived by the Iranians as weakness and
we need to keep moving towards sanctions. Ragaglini agreed
it would be disastrous to change course now.


MEPP a Priority for Italy
--------------


5. (C) Ragaglini said movement on the MEPP was a priority
for FM D'Alema and it would be a priority for the GOI during
its tenure on the UNSC. The status quo was not an option.
Europe believes its security is directly linked to a

ROME 00003132 002.2 OF 003


resolution of the Israeli/Palestinian issue. We are faced
with many weaknesses in the region: the Palestinians are
weak, despite some movement toward a government of national
unity; Israel has been weakened after the conflict with
Lebanon; and Lebanon's domestic situation is fragile and
susceptible to influence from Syria.


6. (C) That said, there are also opportunities, and it will
be important to move quickly, or else the difficulties we
face today will only multiply. Gray pointed out that
President Bush's speech to the UNGA highlighted U.S.
determination to resolve the Israeli-Palestinian conflict,
which was further underscored by the Secretary's trip to the
region shortly thereafter. But resolution of this difficult
issue is not a magic solution for all the issues in the
region. Lebanon will continue to have sectarian divisions,
Iran will continue to look for ways to assert itself as a
regional power, and al-Quaeda will remain a threat.
Ragaglini said the plight of the Palestinians was cynically
used as political cover by Arab leaders, in order to avoid
movement on other issues. But perception can become reality,
and the excuse needed to be removed so that movement on other
issues could proceed.


7. (C) The ME director said the Italians were skeptical of
the recently announced Spanish-French initiative. Any
initiative needed to be EU-wide to carry any weight. It
should first be discussed in the EU's "Quint" (France, Spain,
Italy, UK, Germany) format, then agreed by the entire 25.
Italy would host the next meeting of the Quint in early
December and next steps in the peace process will be on the
agenda.


UNIFIL II Success Essential
--------------


8. (C) Ragaglini said it was essential that UNIFIL II be a
success story. The mission sets an important precedent for
security in the region, since it represents the first time
Israel has accepted such an international force, and it thus
could be a model for future missions.


Syria Unresponsive
--------------


9. (C) Ragaglini noted that PM Prodi had called Syrian
President Bashar al-Assad November 13 to ask him to play a
positive role and refrain from taking any action to
destabilize the Siniora government. Bashar responded
unhelpfully, and disingenuously, saying that Syria had agreed
to requests from the international community to withdraw its
troops from Lebanon, and thus had limited means to influence
the situation. Nevertheless, Italy had made its support for
the Siniora government clear, and also made clear that it
considered this an important test of Syrian intentions.


10. (C) Gray said Bashar lacked his father's strategic
sense, including knowing when and how to change course, and
could not be counted on to act rationally. Ragaglini agreed,
but said there appeared to be no good alternatives on the
Syrian political horizon; the Muslim Brotherhood was
certainly not a palatable option. He added that, looking
beyond Lebanon, the Syrian regime was secular and should
therefore have an interest in joining the West in combating
the problem of Islamic extremism.


11. (C) Comment. Ragaglini replaced Riccardo Sessa as
Director General for Middle East -- NEA A/S equivalant-- in
early November (see reftel for full bio.) This was his first
meeting with a senior U.S. official in his new capacity.
Ragaglini most recently served asPM Prodi's G-8 Sherpa and
has also served as the Former Chief of the Italian Special
Diplomatic Delegation in Baghdad (1996-1999). He was Deputy
Diplomatic Advisor to three consecutive Prime Ministers
including Massimo D'Alema (current Foreign Minister) and he
served his first overseas tour in Tehran. He struck us as a
thoughtful and experienced diplomat who is keen to work
closely with the U.S. on issues which are a top foreign
policy priority for his government and his Minister.


12. (U) NEA DAS Gray has cleared this cable.


13. (U) Triploli minimize considered.

ROME 00003132 003.2 OF 003


SPOGLI