SMORGASBORD: NUMBER THREE AT MFA ON P5 AND IRAN,

C O N F I D E N T I A L SANTIAGO 000583 SIPDIS E.O. 12958: DECL: 06/17/2018 TAGS: PGOV PREL CI SUBJECT: SMORGASBORD: NUMBER THREE AT MFA ON P5 AND IRAN, PARAGUAY AND BOLIVIA, BACHELET IN CUBA, AIRBASE IN PERU, KOSOVO RECOGNITION REF: A. STATE 064530 ¶B. SANTIAGO 745 ¶C. SANTIAGO 148 Classified By: E/Pol Counselor Juan A. Alsace for reasons 1.4 (b) and ( d). -------------- Summary -------------- ¶1. (C) Chile shares international concern over Iran's nuclear program, agrees the P5 1 package of incentives is generous, and recognizes continued Iranian isolation is the logical outcome should it refuse the package. Chile is prepared to offer the new administration in Asuncion technical assistance and share Chilean expertise in areas such as modernization of state institutions, improving education and health, and instituting phytosanitary controls. The GOC is very much preoccupied over Bolivia's center-regions autonomy dispute but sees the "democratically-elected and still popular Morales" as the best guarantee for Bolivia's long term stability. Should Bachelet visit Cuba, she will "certainly" meet with opposition figures. Chile has made no decision on recognizing Kosovo and continues to "study the matter." End summary. ¶2. (U) Ambassador Simons called June 18 on Ambassador Juan Pablo Lira, who recently took up his position as Director General for External Relations, the third ranking job at the MFA. Lira was joined by Ignacio Gonzalez, Director for Middle East and African Affairs; Jose Gonzalez, Lira's Chief of Staff; Julio Bravo of the MFA's Office for Special Policies; and, Francisco del Campo, the North America desk officer. The Ambassador was accompanied by E/Pol Counselor. -------------- P5 1 Offer to Iran -------------- ¶3. (C) The Ambassador opened by delivering ref A demarche points, emphasizing that the package of incentives to Iran is "very generous." The international community understands that Iran wants recognition as a key regional player. This package "of carrots" offers Iran that acceptance, once it has lain aside its nuclear arms ambitions. Sanctions will be raised once verification of compliance with IAEA requirements is clear. Secretary Rice has stressed she is willing to meet with the Iranian leadership "on all issues" upon compliance. The P5 1 has made a "good offer" but one that also demonstrates there are "no outliers" on this issue; Iran faces a unified front. Lira mused as to what would happen 
should Iran refuse the offer. The Ambassador said its international isolation would continue, a fact Iran itself recognizes as it seeks to withdraw its funds from European banks, fearful the monies will be frozen pursuant to European-backed sanctions. Ignacio Gonzalez suggested that perhaps the IAEA wasn't as concerned as the P5 1. E/Pol Counselor noted IAEA Director El Baredi had been in Santiago several months before and had made clear then, in a public forum, that the IAEA suspected the Iranians were less than forthcoming, to the very evident displeasure of the Iranian ambassador to Chile. Bravo agreed, adding that Chile - an IAEA Board Governor - had supported issuance of the last IAEA report, which strongly questioned Iranian good faith. -------------- Lending a Hand to Lugo -------------- ¶4. (C) The Ambassador said he had recently spoken with President Bachelet's international affairs advisor, who said the MFA was preparing a package of potential assistance measures for the new Lugo administration in Paraguay. Washington agencies are interested in the details of Chilean outreach to Lugo. Lira replied Bachelet had had a "very frank and cordial" conversation with the president-elect in Lima, where the two had attended the May 2008 EU-Latin American Summit meetings. While the initial GOC concern had been that Lugo would fall into the Chavez camp, that conversation - and subsequent ones with Lugo's advisors - had provided the Chileans with a better sense of Lugo's direction. Lugo understood he would be hobbled by having to accommodate the views of a diverse coalition and a still powerful Colorado-party led opposition. According to Lira, Lugo was willing to negotiate and, indeed, saw himself as a "transitional" figure between the decades of Colorado party rule and genuine democracy. Lugo had apparently expressed to Bachelet his government's desire to draw on the "Chilean model" in making that transition. ¶5. (C) Turning to notes, Lira said Chile is considering measures - after consultation with Lugo's advisors - in areas such as education, health care, and phytosanitary regulation. It is hard, Lira cautioned, to "transmit recipes for success, however." He noted, for example, that Chile's national police has effectively tackled issues such as delinquency. But the Caribineros are a long-standing institution with a reputation for probity. Paraguay is rife with corruption so employing police there to address social ills is problematic. There are no easy solutions but Chile believes making the effort worthwhile, as helping Lugo succeed will further regional stability. The new Paraguayan FM-elect has also told the GOC she wants to follow the Chilean model. Lugo will come to Chile before he takes office and the MFA will use that visit to clarify how Chile can be of help. Lira added Bachelet would lead the Chilean delegation to Lugo's August 15 inauguration. -------------- Not Giving Up On Morales -------------- ¶6. (C) The Ambassador, noting he was not speaking under instructions, said that President Bachelet enjoyed some influence over Evo Morales, and then detailed USG concerns over the failure of the GOB to provide adequate security for our Embassy in La Paz. Lira said the Chileans understood and would do what they could. Lira continued that Chile's relationship with Bolivia is "very important," noting that northern Chilean port cities such as Iquique and Arica depended heavily on trade with Bolivia. Chile is concerned about Bolivia's internal political instability. While recognizing that aspirations for autonomy in the Bolivian Sierra have popular support, Morales is the "democratically elected" president who maintains overall majority support nationwide. He has done a good job negotiating energy accords with Argentina and his government is one of the least unstable with which Chile has dealt in recent years. Lira observed that regular bilateral talks at the Vice FM level were proceeding "as we speak" including on the sensitive issue of Bolivia's access to the sea claims. The Chilean and Bolivian defense ministers had also just signed the day before an accord on defense cooperation (septel). -------------- Hugo on Best Behavior -------------- ¶7. (C) Lira asked what is the USG take on "Hugo's recent apparent conversion", observing that the Venezuelan president has been "behaving himself" since the March 2008 Rio Group meeting in the Dominican Republic. The Ambassador replied that, in his view, the Reyes tapes had played a significant role in affecting the behavior of both Chavez and Correa. The implicit threat of being placed on the USG supporters of terrorism list may also have sobered Chavez, who does not want to be isolated internationally. The FARC's weakening position may also be a factor, as were Chavez's own internal domestic problems. Lira agreed with the Ambassador's analysis, adding that there are also whisperings that some within the Venezuelan military may be tiring of Chavez. Jose Gonzalez said that while Chavez might have to deal with some squabbling within his support, his political opposition is hopelessly divided. Lira noted that when Bachelet had visited Caracas in April 2007, she had met with some of the opposition, an experience she had described as "being in a bagful of cats." -------------- Bachelet to Cuba? -------------- ¶8. (C) E/Pol Counselor asked if Bachelet would similarly meet with Cuban dissidents in Havana, should she travel there in February 2009, as has been widely reported (ref B). Lira was emphatic in saying she would. "It is the custom" for her to do such meetings, adding "if she does go." -------------- U.S. Assistance to Peru -------------- ¶9. (C) Lira asked about a June 16 press report that the U.S. is building an airbase in Peru, implicit to stationing U.S. assets there. The Ambassador said it is true the USG is helping Peru refurbish a small airstrip in Ayacucho Department. It is meant to assist Peru in its counter-narcotics and counter-terrorism efforts. It will not be a U.S. base. E/Pol Counselor added that DASD Johnson had spoken earlier in the day with MOD U/S of War Gonzalo Garcia to also explain the purpose of the U.S. assistance to Peru. -------------- No Movement on Kosovo -------------- ¶10. (C) E/Pol Counselor asked if Chile had yet made a decision on recognizing Kosovo, noting past demarches (ref C). Lira said that there had been extensive discussion of the issue at the EU-Latin American Summit in Lima with the Germans and others ("a Serbian minister had been very active lobbying against") but, in short "sin novedad" (nothing new). The issue is still being studied and we expect no decision before the UNGA in September. SIMONS