DEMARCHE REQUEST: OPPOSE MESIC-AHMADINEJAD MEETING

C O N F I D E N T I A L SECTION 01 OF 02 STATE 132302

SIPDIS

SIPDIS

E.O. 12958: DECL: 09/18/2017
TAGS: PREL KNNP HR IR
SUBJECT: DEMARCHE REQUEST: OPPOSE MESIC-AHMADINEJAD MEETING

REF: ZAGREB 850

Classified By: Assistant Secretary D. Fried


1. (C) SUMMARY: In response to REFTEL, Department asks Post
to reiterate that a meeting between Croatian President Mesic
and Iranian President Ahmadi-Nejad at UNGA would be
ill-advised. END SUMMARY.

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OBJECTIVES
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2. (C) Department instructs Embassy to pursue the following
objectives:

--Urge Mesic again not to meet with President Ahmadi-Nejad at
UNGA. We are in close consultation with our P5 1 partners on
additional UNSC sanctions against Iran in response to Iran,s
failure to comply with UNSC resolution 1747. High-level
meetings with Iran,s leaders risk giving Iran the impression
that &business as usual8 can continue despite Iran,s
noncompliance.

--Note the strong European line on Iran, including discussion
of EU-wide and bilateral sanctions ) beyond a third UNSC
resolution. Encourage Croatia to follow Europe,s lead in
dealing with Iran.

-- If Mesic insists on conducting the meeting, advise him to
take the opportunity to remind Iran of its requirement to
suspend all enrichment-related, reprocessing, and heavy
water-related activities pursuant to UNSCR 1747. Mesic
should also encourage Iran to take advantage of the
unprecedented opportunity available to Iran through the
P5 1,s June 2006 offer. Urge Mesic not to seek expanded
economic cooperation with Iran.

-- Given Iran,s continued refusal to meet its international
obligations, commercial engagement with Iran should be
reduced and new investment should be discouraged. In
particular, involvement in arrangements that could develop
and expand Iran,s hydrocarbon sector would raise concerns
under U.S. sanctions law.

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BACKGROUND
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3. (SBU) The United States is committed to a diplomatic
solution to the threat Iran,s nuclear program poses to the
international community. To that end, as part of a package
of incentives the P5 1 offered Iran in June 2006, Secretary
Rice proposed engaging in direct negotiations with Iran if
Iran suspended its uranium enrichment-related and
reprocessing activities. Suspension was mandated in UNSCR
1696, adopted in July 2006. Iran,s continued refusal to
suspend these activities prompted the UNSC to adopt
resolutions 1737 and 1747, imposing Chapter VII sanctions on
Iran, including prohibitions on nuclear and missile-related
technology transfers, freezing the assets of entities and
individuals associated with Iran,s nuclear and missile
programs and banning Iran from exporting arms.


4. (SBU) On May 23 and again on August 30, 2007, the IAEA
Director General released a report showing that Iran still
has not suspended its enrichment- and heavy water-related
activities. The recent IAEA-Iran &Work Plan8 announced on
August 27, while a positive step, primarily addresses
historical issues. Even if fully implemented, it would not
bring Iran into compliance with its UNSC obligations. Given
Iran,s continued refusal to comply with its suspension
requirement, the United States is now pursuing a third
sanctions UNSCR and is encouraging international partners to
impose bilateral sanctions to further isolate Iran.


5. (SBU) Our allies in Europe and elsewhere have adopted
strong measures to enforce the UN resolutions and isolate
Iran. The EU,s implementation regulations for UNSCRs 1737
and 1747 are particularly strong and go beyond the
requirements of the resolutions. For example, Germany has
reduced its export credits to Iran, and its private banks
Deutsche Bank, Dresdner Bank, and Commerzbank have announced
they are terminating or curtailing most business
relationships with Iran. Portugal,s Ambassador to the IAEA,
representing the EU as its current president, delivered a
forceful statement at the most recent IAEA Board of Governors
reiterating the need for Iran to suspend enrichment and

STATE 00132302 002 OF 002


noting the possibility of new Chapter VII sanctions.
Meanwhile, French Foreign Minister Kouchner has called for
additional sanctions and discouraged French companies from
responding to tenders in Iran.

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REPORTING DEADLINE
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6. (U) Post should report results within seven (7) business
days of receipt of this cable. Please slug replies for ISN,
T, TREASURY, EUR and NEA. Please include SIPDIS in all
replies.

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POINT OF CONTACT
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7. (U) EUR/SE Raffi Balian at (202) 647-4987 or
NEA/IR Carolyn Coberly at (202) 647-2413.
RICE