VZCZCXRO7165
PP RUEHAG RUEHDA RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN RUEHLZ
RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHMD #0766/01 0891417
ZNR UUUUU ZZH
P 301417Z MAR 06
FM AMEMBASSY MADRID
TO RUEHC/SECSTATE WASHDC PRIORITY 9272
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
RUEHLA/AMCONSUL BARCELONA PRIORITY 1824

UNCLAS SECTION 01 OF 03 MADRID 000766 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: PTER PGOV PREL SP
SUBJECT: ETA CEASEFIRE: MAJOR POLITICAL VICTORY FOR ZAPATERO 
 
REF: A. MADRID 720 
     ¶B. MADRID 707 
     ¶C. OSLO 374 
 
MADRID 00000766  001.2 OF 003 
 
 
¶1. (U) Summary.  The recent announcement of a permanent 
ceasefire by the Basque separatist terror group ETA was met 
with cautious optimism by a public that recalls ETA's 
abandonment of previous truces.  However, there is a sense 
that ETA's declining military fortunes and Zapatero's 
readiness to engage Basque political factions, have convinced 
ETA of the need to end violence and shift to the political 
arena.  Government figures involved in the negotiations 
remain tight-lipped about the details of their discussions, 
but press reports indicate that Sinn Fein figures played a 
role in convincing ETA to shift to the political process and 
that Sinn Fein briefed former President Clinton and USG 
officials regarding the progess of the ETA talks; a March 30 
press report indicated strong interest by former President 
Clinton in playing a mediating role.  Some ETA-Government 
discussions evidently took place in third countries, 
including in Norway and Switzerland.  The ETA announcement 
has proven a major political victory for the Zapatero 
government, one that will likely benefit the Socialist Party 
through the 2008 general elections.  End summary. 
 
//ETA ON THE WANE// 
 
¶2. (U) ETA has killed more than 850 people during its 
four-decade-long battle to win self-determination for the 
Basque Region, which already enjoys considerable autonomy, 
including its own police force, control over tax revenues, 
and management of its education system.  The terrorist group 
benefited from both a strong Basque sense of cultural 
identity and from the region's historical grievances against 
the Madrid government.  However, support for ETA has been 
limited by the Basque region's heterogenous political 
environment (with about one-third of the electorate 
supporting close ties to the central government) and by the 
strength of moderate Basque nationalist political groups. 
ETA and its political front groups, known as the "abertzale" 
or Basque nationalist left, have maintained a core of 
approximately 150,000 supporters out of the Basque Region's 
population of 2.1 million, a political base strong enough to 
play a spoiler, but too small to set the political agenda. 
 
¶3. (U) ETA's military capacity has been in steady decline 
since 1990, a trend that has accelerated in recent years. 
The combination of Spanish/French police pressure and the 
exclusion of ETA front group Batasuna from the political 
system (because of its refusal to renounce terrorism) had 
greatly weakened ETA by 2004.  Most police observers believe 
that fewer than 150 ETA terrorists remain at large, while 
more than 500 are being held in Spanish and French jails. 
The March 2004 Madrid train attacks added complications for 
ETA in the form of increased public intolerance of political 
violence, even among Basque radical supporters. 
 
¶4. (U) The Socialist (PSOE) victory in 2004 also led to 
greatly improved relations between the central government and 
moderate Basque political parties, further isolating radical 
Basque nationalists.  Zapatero hinted, however, that the PSOE 
would be open to a greater political role for ETA front 
groups if the organization abandoned the armed struggle, an 
important signal in advance of key municipal elections coming 
up in 2007.  Sensing the shift in its political and military 
environment, ETA approached the Zapatero government in August 
2004 to suggest exploratory discussions. 
 
//MULTIPLE CHANNELS OF COMMUNICATION// 
 
¶5. (U) While the small circle of Zapatero advisers who manage 
the ETA peace process have refused to discuss details, press 
reports indicate that Zapatero responded positively to ETA's 
soundings, authorizing a series of contacts that eventually 
led to the March 22 cease fire announcement.  It appears that 
those discussions were undertaken through intermediaries in 
different locations, including in Oslo and Geneva in the 
summer of 2005, and that the talks were intended as 
confidence building measures rather than to formally resolve 
specific issues. 
 
¶6. (U) At the international level, Sinn Fein figures played 
an important role in convincing ETA to announce a cease fire 
and express support for a political solution to the conflict. 
 Specifically, Parliamentarians Gerry Kelly and Alex Maskey 
have been identified as Sinn Fein "advisers" to ETA, a role 
they allegedly took on at the request of Batasuna.  According 
to the daily "El Mundo," Kelly and Maskey briefed Sinn Fein 
leader Gerry Adams, who then reportedly briefed the Irish and 
UK governments, as well as U.S. State Department official 
Mitchell Reiss and former President Clinton, on the progress 
 
MADRID 00000766  002.2 OF 003 
 
 
of the talks.  According to Spanish daily "El Periodico," 
Spanish government sources report that former President 
Clinton contacted Zapatero to offer to act as a mediator in 
ETA discussions; the press report said Zapatero was very 
interested in involving a "U.S. Democrat with international 
prestige" in the peace talks.  COMMENT: The Embassy has not 
received any such indications from the Spanish government. 
END COMMENT. 
 
¶7. (U) While these international contacts were important in 
bringing ETA along, the key internal communications began 
with a set of conversations between the Basque branch of the 
Spanish Socialist Party and Batasuna leader Arnaldo Otegi in 
early 2004.  Through these discussions (which will be 
reviewed extensively in a separate cable), the Zapatero 
government signaled its willingness to negotiate with radical 
Basques, but only if ETA announced a halt to its terrorist 
activities.  Batasuna and Basque Socialist leaders agreed 
during these talks that ETA would leave political issues to 
be handled by "abertzale" (Basque leftist) political parties, 
while ETA would only address issues related to weapons and 
ETA prisoners.  Under these terms, ETA agreed to a cease 
fire, at a time to be determined by the organization.  Almost 
certainly, ETA made the announcement now in the hope that 
Batasuna would have time to negotiate its participation in 
the 2007 Basque municipal elections. 
 
//PARSING THE CEASE FIRE// 
 
¶8. (U) Spanish experts and media pored over the March 22 
cease fire announcement to compare it with previous truce 
delcarations.  The most critical element in the 2006 ETA 
document in comparison with previous delarations is the 
absence of an explicit demand for Basque self-determination, 
ETA's central ambition throughout its history.  The short ETA 
statement appears to have been drafted to fit the resolution 
approved by Spain's Congress in May 2005, which requires 
ETA's abandonment of the armed struggle as a pre-condition 
for government negotiations with ETA.  Skeptics point out 
that the ETA statement neither expressed regret for ETA's use 
of terrorist methods nor repudiated tactics such as extortion 
and "kale borroka," (organized vandalism and street 
violence), tactics it continued to employ during previous 
truces.  It is vague in that respect and could leave the door 
open for ETA to continue to use these methods. 
 
¶9. (U) Zapatero is expected to delay responding to ETA for at 
least two months to allow the government to determine whether 
ETA is complying with its cease fire.  In an important 
clarification, Vice President Maria Teresa Fernandez de la 
Vega indicated that the government viewed both the cessation 
of ETA street violence and the halt of ETA extortion of 
Basque businesses as part of the cease fire. 
 
//A POLITICAL COUP FOR ZAPATERO// 
 
¶10. (SBU) While there is far to go in achieving a definitive 
end to the ETA problem, the cease fire announcement 
constitutes a resounding political victory for Zapatero.  The 
cease fire not only vindicated Zapatero's pursuit of a 
negotiated solution to the conflict, it also undermined 
opposition accusations that he was weak on terrorism.  The 
result was an immediate jump in Zapatero's approval ratings 
and a surge in confidence within the Socialist Party, which 
until the ETA announcement was barely one point ahead of the 
PP in the polls.  Rafael Estrella, the Socialist spokesperson 
in the Parliamentary Foreign Affairs Commission, told the DCM 
and Political Counselor on March 22 that the ETA announcement 
virtually guaranteed a political victory for the Socialist 
Party in the 2008 general elections.  Less partisan observers 
have echoed this analysis. 
 
¶11. (U) Zapatero has moved swiftly to consolidate his 
advantage.  After dramatically expressing his "full 
confidence" in the PP to work responsibly with his government 
in managing the ETA peace process, Zapatero met with Popular 
Party (PP) leader Mariano Rajoy on March 28 to seal the 
bargain.  The PP grudgingly agreed to support the 
government's initiative, understanding that it would face a 
significant backlash if the party were perceived as blocking 
an opportunity to bring an end to ETA violence.  In order to 
obtain full political cover, Zapatero will meet with all 
political parties to seek their support and is expected to 
eventually ask the Parliament for authorization to start 
official talks with ETA. 
 
//COMMENT// 
 
¶12. (SBU) It may be early for the PSOE to forecast victory in 
the 2008 elections, but the Zapatero government is clearly in 
a very strong position and well situated to direct events to 
 
MADRID 00000766  003.2 OF 003 
 
 
PSOE's advantage.  Many observers expect Zapatero to delay 
any definitive solution regarding ETA's status and Basque 
autonomy until after the 2008 elections rather than risking a 
bruising political fight on these issues before electoral 
victory is assured.  Zapatero could suffer if his handling of 
ETA is viewed as insensitive to the victims of terrorism, but 
his caution and pursuit of broad political backing for his 
approach to ETA will shield him to some degree.  A more 
controversial point will be the political "reinsertion" of 
ETA-affiliated groups, which is necessary in Zapatero's view 
and yet anathema to the PP and to conservative voters.  At 
this point, the most likely approach is the formation of a 
new Basque nationalist party rather than the "legalization" 
of Batasuna, since Batasuna remains under judicial sanction 
and is associated by the public with its defense of ETA 
terrorism. 
AGUIRRE