VZCZCXRO4383
RR RUEHAG RUEHDF RUEHIK RUEHLZ RUEHROV
DE RUEHMD #0312/01 0530834
ZNR UUUUU ZZH
R 220834Z FEB 07
FM AMEMBASSY MADRID
TO RUEHC/SECSTATE WASHDC 1902
INFO RUCNMEM/EU MEMBER STATES COLLECTIVE
RUEHLA/AMCONSUL BARCELONA 2457

UNCLAS SECTION 01 OF 02 MADRID 000312 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
EUR/WE 
 
E.O. 12958: N/A 
TAGS: EAGR EAID EAIR ECON EFIN ENRG ETRD SENV TBIO
SP, EINV, UK 
SUBJECT: MADRID WEEKLY ECON/AG/COMMERCIAL UPDATE REPORT 
 
MADRID 00000312  001.2 OF 002 
 
 
EFIN: Peseta vs. Euro 
EMIG/EFIN: Immigrants send 3.2 billion home 
EAGR, BEXP: U.S. Farm Bill proposal under study 
EAGR: U.S. Almonds must be inspected for Aflatoxin 
SOCI/TBIO: Avian Influenza readiness 
ENRG, ECON, KIPR: Ambassador's meeting with Economic Advisor 
 
 
SURVEY SAYS...PESETA OVER EURO 
 
¶1. (U) A Financial Times survey shows over two thirds of 
Spaniards would like a return to the peseta:  The FT also 
found similar majorities against the euro in France and 
Italy, but a smaller majority opposed to the euro in Germany. 
 Majorities in all these countries thought the euro was good 
for Europe, but not for their country. (Comment: In Spain, 
opinion is mixed about the euro.  Many people understand that 
euro membership has allowed for historically low interest 
rates, and hence a very long real estate boom benefiting 
people who bought three or four years ago.  On the other 
hand, the popular perception is that adoption of the euro 
allowed for a steep one-off increase in real prices, for 
instance in the cost of a glass of beer or cup of coffee -- 
not a trivial perception to a bar and cafe- frequenting 
people like the Spaniards.)  (ABC, 1/30/07) 
 
SPAIN BEATS GERMANY AS IMMIGRANTS TOP REMITTANCE LIST 
 
¶2. (U) EU Report shows Spanish immigrants at the top of the 
EU remittance league: According to an EU survey, Spanish 
immigrants sent about Euros 3.2 billion back to their home 
countries in 2004.  The runner up was Germany where 
immigrants sent a little over Euros 2 billion back. (Note: 
2005 was, according to press reports, the first year 
remittances flowing out of Spain topped remittances flowing 
into Spain.  This change reflects the switch in Spain from a 
country of emigration to a country of immigration.  End 
note.) (ABC, 1/30/07) 
 
SPAIN PLEAS NO COMMENT ON U.S. FARM BILL 
 
¶3. (U) The Bush Administration's proposal to "modernize" the 
U.S. Farm Bill was greeted with some consternation by 
European Commission officials and representatives of some 
European Union producer groups, but on the Iberian Peninsula, 
there has been no, absolutely no reaction.  Spanish and 
Portuguese Government officials indicate that they will not 
likely make any public pronouncements even after they are 
finished evaluating the proposal.  Spanish agricultural 
advocacy groups have also refrained from comment, again while 
they study the proposal. 
 
AFLATOXIN INSPECTION FOR U.S. ALMONDS 
 
¶4. (U) The European Commission (EC) will soon announce that 
100 percent of U.S. almonds shipped to Europe must be 
inspected for aflatoxin unless exported under the California 
Voluntary Aflatoxin Sampling Program (VASP).  Only five 
percent of VASP shipments will need to be inspected. 
Government of Spain's Health Ministry (MOH) believes that it 
is prepared to comply with the expected EC directive, but MOH 
officials also expect that most U.S. almond shippers will 
sign up under VASP, thus drastically reducing the need for 
inspections. 
 
¶5. (U) Embassy Madrid recommended to FAS/Washington that 
USDA/FAS/Madrid needs to be very forthcoming with MOH 
regarding U.S. almond exporter intention and ability to sign 
and export up under VASP.  To the extent possible, we will be 
working with USDA/FAS/Washington and the California Almond 
Board to identify the potential number of almond containers 
MOH will need to inspect during the very busy export months 
of August, September, October, and November, so that the 
potential delays will be minimized. 
 
SPAIN USES UK BIRD FLU OUTBREAK TO REITERATE ITS AVIAN 
INFLUENZA READINESS 
 
¶6. (U)  Spain convened its "Inter-Ministerial Avian Influenza 
Tracking/Information Commission" on February 5, in the 
aftermath of the Bird Flu outbreak in the Holton, United 
Kingdom.  Following the meeting, the Commission announced 
that Spain would keep all its protective measures in place. 
The Commission noted that the fact that Spain has had only 
one infected bird (found in July 2006 in the Basque Region) 
demonstrates the efficiency of both Spain's Avian Influenza 
Vigilance Plan for Domestic and Wild Birds, as well as 
Spain's overall Veterinary Alert System.   The Commission 
 
MADRID 00000312  002.2 OF 002 
 
 
also reiterated that Spain's Avian Influenza Preparation and 
Response Plan has implemented all EU and WHO recommendations. 
 Finally, the Commission noted that Spain's Avian Influenza 
planning had been reviewed in October 2006 by the European 
Center for Disease Control and that the results of the review 
were "very positive."  The Commission's communique ended by 
reiterating the now standard Spanish position that the risk 
of a human-to-human outbreak of Bird Flu "has not changed and 
continues to be extraordinarily low." 
 
AMBASSADOR'S 2/15/07 MEETING WITH PRESIDENT ZAPATERO'S 
ECONOMIC ADVISOR DAVID TAGUAS 
 
¶7. (U)  Taguas asked to meet with the Ambassador informally 
at the Residence.  Both agreed to consult with the Spanish 
and U.S. business communities regarding the AmCham's proposal 
to change the U.S.-Spain double taxation treaty.  Taguas said 
the tax authorities would continue to look into some 
inspections AmCham had complained about.  Visiting GE CEO 
Jeff Imelt had agreed with President Zapatero to participate 
in a carbon sequestration project.   Taguas and Ambassador 
agreed to coordinate further on the June 22-24 U.S.-Spain 
Council meeting in Salamanca.  Taguas talked about arranging 
a June 26 Energy Seminar focused on renewables.  He said 
President Zapatero might attend.  The Ambassador said if the 
choice was between the U.S.-Spain Council meeting and the 
energy seminar, we prefer President Zapatero to attend the 
Council meeting.  Taguas said President Zapatero is committed 
to the 220 meter biotech coexistence requirement but said he 
would talk to Environment Minister Narbona to see if this 
could be modified.  The Economic Advisor said it was his 
impression that Prime Minister Blair is very committed to 
addressing global warming with the Germans and French less 
enthusiastic.  Taguas said he would try to set up a meeting 
(probably in connection with the U.S.-Spain Council meeting) 
to discuss ways in which American firms can compete for 
public sector construction projects in Spain.  Ambassador and 
Taguas talked about making rail transportation in Spain more 
consistent with European standards.  The Ambassador noted 
that the Canaries might be an interesting place for 
pharmaceutical companies to invest in because of the 
favorable tax regime there.  Taguas talked a great deal about 
health care challenges in Europe. (Comment: Taguas clearly 
wants to have good relations with us, but we are skeptical 
his office can deliver on hard issues.  Our sense is that he 
and his team are reluctant to take on Ministries on 
controversial topics.  Nonetheless, Taguas is a worthwhile 
interlocutor because of his proximity and access to President 
Zapatero.) 
 
¶8. (U) Health Ministry shows signs of slightly more 
flexibility on pharmaceutical patent issue: Econ heard in a 
2/15/07 lunch with Moncloa Economic Office staff that Health 
Minister Salgado might be willing to be more flexible on the 
issue of providing product patent protection for a number of 
drugs (as a practical matter, for the most part a number of 
the "blockbuster" drugs used to control cholesterol) that 
currently only benefit from process patent protection in 
Spain.  EconOff confirmed this in a 2/16/07 telcon with 
Pfizer Spain CEO.  (Comment: If true, this would be good 
news, but the GOS has still not developed the mechanism 
whereby such additional protection would be granted.  We 
cannot therefore declare victory yet.) 
AGUIRRE