VZCZCXRO8469
RR RUEHCD RUEHGD RUEHHO RUEHMC RUEHNG RUEHNL RUEHRD RUEHRS RUEHTM
DE RUEHME #3839 2011619
ZNR UUUUU ZZH
R 201619Z JUL 07
FM AMEMBASSY MEXICO
TO RUEHC/SECSTATE WASHDC 8063
INFO RUEHXC/ALL US CONSULATES IN MEXICO COLLECTIVE
RUEHMD/AMEMBASSY MADRID 0460
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEHC/DEPT OF LABOR WASHDC
RUEATRS/DEPT OF TREASURY WASHDC

UNCLAS MEXICO 003839 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
FOR WHA/MEX AND EUR/WE 
 
E.O. 12958: N/A 
TAGS: PGOV PTER ECON MX
SUBJECT: ZAPATERO VISIT BOOSTS CALDERON 
 
¶1. (SBU) Summary: During his four-day visit to Mexico, 
Spanish PM Jose Luis Rodriguez Zapatero and President 
Calderon agreed to cooperate on apprehending ETA members and 
other extremists, develop infrastructure and the tourism 
sector, increase people-to-people contacts through a 
"Dialogue Forum," and defend the environment.  Zapatero also 
publicly criticized the "border wall" between the United 
States and Mexico.  End summary. 
 
¶2. (SBU) During the Prime Minister's visit from July 14-17, 
the Spanish and Mexican governments agreed to renew their 
strategic association agreement dating from 2001, 
intensifying operational cooperation in counterterrorism, 
money laundering, terrorism funding, organized crime, and 
drug trafficking.  The Spanish Government has long sought the 
GOM's assistance in cracking down on ETA fugitives in Mexico. 
 Spain will open a Security Department in its Embassy in 
Mexico City, and the leaders pledged to intensify police and 
judicial cooperation, including funding and extradition. 
They also vowed to encourage greater cultural and 
environmental cooperation. 
 
¶3. (SBU) During his tour of Mexico, Zapatero was accompanied 
by a group of Spanish investors, headed by Javier Gomez 
Navarro of the Superior Council of Chambers in Mexico.  They 
pledged continued support for Mexico through investment and 
trade.  Zapatero envisioned an increase in Spanish investment 
in Mexico's tourism industry (boosting rooms under Spanish 
control by a third) and infrastructure construction.  This 
built on a theme touted during Calderon's earlier tour of 
Europe, in which he highlighted Spain as a logical gateway 
for Mexican commerce with Europe. 
 
¶4. (SBU) Despite the promotion of stronger commercial ties 
between Spain and Mexico, Spanish businessmen used a meeting 
with Zapatero and Calderon as an opportunity to present a 
list of obstacles that the Spanish tourism industry 
encounters in Mexico.  Concerns included the lack of legal 
certainty and efficient resolution to permit requests.  The 
executives also called for improved transportation 
infrastructure (roads and airports) and complained that the 
lack of alternative airports in the Quintana Roo region made 
it difficult to accommodate large-scale tourist evacuations, 
as was needed during hurricane Wilma in 2005. 
 
¶5. (SBU) The Spanish executives joined numerous businessmen 
concerned over the Calderon government's fiscal reform 
proposal (particularly the corporate single rate tax, called 
CETU).  While the businessmen agreed reform is necessary, 
Navarro said there is some nervousness over the way the new 
law would be implemented.  Calderon responded that 
law-abiding companies do not need to worry about the tax, 
intended to catch those who try to dodge their fiscal 
responsibilities.  Zapatero extended his support to Calderon 
regarding the issue, saying that every country has a right to 
fiscal reform that facilitates commerce and improves social 
justice.  Speaking to the press on the border fence, Zapatero 
said, "there is no wall, no matter how high, wide, or long 
(that can) prevail over the dream of a better life." 
 
¶6. (SBU) Zapatero's visit received mixed reactions from 
members of the Mexican left, particularly the PRD.  A number 
of Andres Manuel Lopez Obrador (AMLO) supporters demonstrated 
against Zapatero's visit, and Gustavo Iruegas, foreign policy 
advisor to AMLO, called Zapatero a "persona non grata."  Some 
members, including party chairman Leonel Cota, insisted that 
Zapatero was a traitor for his prompt recognition of 
President Calderon's electoral victory, while the PRD 
legislative coordinators said Zapatero was welcome in Mexico. 
 
 
Visit Mexico City's Classified Web Site at 
http://www.state.sgov.gov/p/wha/mexicocity and the North American 
 Partnership Blog at http://www.intelink.gov/communities/state/nap / 
BASSETT