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DE RUEHMD #0098/01 0321058
ZNR UUUUU ZZH
R 011058Z FEB 08
FM AMEMBASSY MADRID
TO RUEHC/SECSTATE WASHDC 4164
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHUB/USINT HAVANA 0245

UNCLAS SECTION 01 OF 05 MADRID 000098 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: OREP PREL ECON EFIN ETRD ENRG EINV SP
SUBJECT: CODEL MARTINEZ JANUARY 10-11 VISIT TO MADRID 
 
 ¶1. (U) Summary:  Codel Martinez had a busy and productive 
visit to Madrid January 10-11, 2008, meeting with the Prince 
of Asturias, Popular Party (PP) presidential candidate 
Mariano Rajoy,  National Security Advisor Carles Casajuana 
(septel), former President Aznar, Foreign Minister Moratinos 
(septel), and Cuban dissidents Hector Palacios and Gisela 
Delgado.  The Ambassador accompanied Senator Martinez in all 
of his meetings.  Codel Martinez also attended a lunch 
organized by the American Chamber of Commerce where 
discussion focused on renewable energy and a dinner with the 
U.S.-Spain Council hosted by the Ambassador.  In addition, 
Senator Martinez gave an interview to El Pais newspaper. 
Senators Grassley and Thune met with a senior official at the 
Ministry of Industry, Tourism, and Trade to discuss U.S. pork 
exports.  End Summary. 
 
Prince of Asturias 
------------------ 
 
¶2. (SBU) Shortly after their arrival January 10, Senators 
Martinez, Grassley, Thune, and Craig were received by the 
Prince of Asturias at Zarzuela Palace.  The Prince stressed 
the importance for Spain of maintaining excellent relations 
with the U.S. and his commitment to improving those 
relations.  The Prince reminisced happily about his travels 
in the U.S. and expressed a great fondness for the country. 
He had clearly been following the U.S. Presidential primaries 
and sought the Senators' views on the process. 
 
Mariano Rajoy 
------------- 
 
¶3.  (SBU) The delegation met at PP headquarters with 
presidential candidate Mariano Rajoy.  Rajoy noted that with 
less than two months to go before the Spanish general 
elections, the polls showed him in a tie with Zapatero and 
his Spanish Socialist Workers, Party (PSOE).  Rajoy said his 
campaign would focus on the economy, nationalism, and 
terrorism.  On the economy, he said polls showed it to be the 
number one issue.  Rajoy said Zapatero had lived for four 
years off the inheritance of the previous PP,s government's 
good economic management.  Rajoy said the macroeconomic 
indicators were still good, but people were beginning to feel 
the pinch of inflation running above the EU average.  He also 
said interest rates were rising, a serious worry in a nation 
of 44 million with eight million mortgages.  Rajoy said 
Zapatero had not defended Spain, the oldest national identity 
in Europe, from the demands of radical regional groups with 
nationalistic aspirations.  On terrorism, Rajoy contrasted PP 
firmness with Zapatero,s attempt to negotiate with ETA. 
 
¶4. (SBU) In foreign policy, Rajoy said he would defend 
democracy, freedom, human rights, and Western values.  He 
said Spain (and Europe) needed the best possible relationship 
with the U.S.  Rajoy noted Spain had once been a reliable 
ally of the U.S.  He promised that as President he would 
speak his mind and avoid surprises.  Rajoy said Spain should 
play a significant role in Latin America and should promote 
democracy, freedom, and human rights in the region, which was 
suffering some unacceptable leaders at the moment.  He said 
the PP position regarding Venezuela was well known:  populism 
was not the direction the people of Latin America were 
moving.  He expressed strong disagreement with Zapatero,s 
Cuba policy and voiced concern over treatment of dissidents 
in Cuba.  Rajoy noted Spain,s position on Cuba was important 
within the EU.  Rajoy insisted he would fulfill Spain,s 
commitments abroad, which would be in defense of Western 
values.  He said it was difficult but the public would 
understand the need for overseas engagement if the problems 
were explained to them.  He said Spain would continue in 
Afghanistan, and noted the while in opposition the PP had 
supported sending troops abroad.  Rajoy said the PP opposed 
Spain,s 2004 withdrawal from Iraq, which he characterized as 
a mistake, albeit one that won the PSOE votes. 
 
¶5. (SBU) Although he did not indicate he would make it a 
campaign issue, Rajoy noted Spain was number two in the world 
behind the U.S. in terms of the numbers of immigrants 
received.  Over ten percent of the population was of foreign 
origin, and there was a large Muslim immigrant population. 
He said immigration was beginning to cause problems, as 
ordinary Spaniards saw their access to social services 
affected (he mentioned public health was 40 percent of 
Spain,s budget).  He said the PP was against illegal 
immigration and in favor of orderly migration flows.  He 
condemned Zapatero,s amnesty for nearly one million illegal 
immigrants, saying it had drawn new immigrants and noted that 
migratory pressures from Africa were only increasing. 
 
¶6. (SBU) Rajoy mentioned that while Minister of Interior he 
was the first European minister to visit the U.S. after the 
 
MADRID 00000098  002 OF 005 
 
 
9/11 attacks.  He said the West needed to invest more 
resources in educating people about democratic values.  He 
criticized the Zapatero government,s Alliance of 
Civilizations (AOC) effort, saying it was an electoral ploy. 
He said the left wing in Spain and elsewhere tried to use the 
popular media and entertainment figures to convince people 
that they favored peace while center right parties such as 
the PP in Spain favored war.  He said this had to be 
countered through education. 
 
¶7. (SBU) Asked about voter turnout, Rajoy said this was a big 
unknown.  He said in 2000 the PP won an absolute majority in 
Congress.  In 2004, they lost by about five percent because 
Zapatero was able to mobilize socialist voters using the Iraq 
war and the Atocha bombings.  He characterized 2004 as a vote 
against the PP rather than for the PSOE.  Rajoy predicted the 
anti-PP vote would not be there this year.  He said the PP 
base was very loyal and would vote, so the question was many 
socialist actually turned out.  He noted in 2004 polls should 
him eight points ahead the day of the Atocha bombings, and he 
lost by five points the following Sunday.  Rajoy noted that 
the polls in the 2007 municipal elections predicted PP 
defeat.  In fact, the PP won.  He said turnout and loyalty 
were key.  He claimed polls showed 85 percent of PP voters 
were loyal but only 72 percent of PSOE voters.  He said his 
strategy was to reach out to the center and the opposition 
rather than to his base.  He said this was to avoid 
mobilizing the PSOE base and increasing their turnout.  Rajoy 
mentioned that convincing the media which supported the PP to 
avoid antagonizing the left was a challenge.  Noting he had 
been campaign manager both times, he noted Aznar,s 1996 
campaign was aggressive whereas in the even more successful 
2000 campaign the PP had behaved like nuns.  Rajoy said the 
costs of campaigning in Spain were negligible compared to the 
U.S.  He said in Spain, as opposed to the U.S., it was 
important not to let people know how much money you had 
raised since voters would turn against the candidate with the 
most money.  He noted the parties were prohibited from buying 
advertising until the last two weeks, and so they had to earn 
media coverage in the meantime and were heavily focused on 
the internet, which he said was the only way to reach young 
voters.  He said the party was commissioning two polls a 
month and would move to daily polling in the last two weeks 
(Rajoy joked that after long and intensive study of the 
science of polling he had concluded he knew nothing about 
polls).  He said most of the PP money would be spent on radio 
and billboard advertising.  He noted he was on the trail four 
out of every seven days.   Rajoy said the debates, scheduled 
for February 25 and March 3, could be decisive since they 
came so late in the process.   He mentioned that the PP was 
also hitting family issues, noting the PSOE favored gay 
marriage.  Rajoy said there were 1.5 million absentee voters, 
a number he said was significant in terms of the Spanish 
electorate.  He recalled that in a recent election the PP had 
lost a seat in Galicia because Hugo Chavez had sequestered 
the mail from Venezuela, which Rajoy was sure contained a 
heavy PP vote since Spaniards there were unhappy with the 
PSOE,s failure to stand up to Chavez.  Rajoy mentioned the 
PP had an office in Washington and their representative there 
was part of the party,s governing committee.  He also sought 
the Senators, views on the U.S. Presidential campaign. 
 
Jose Maria Aznar 
---------------- 
 
¶8.  (SBU) On January 11 CODEL Martinez held a wide-ranging 
discussion with former Spanish President Jose Maria Aznar 
that touched on the electoral outlook in Spain and the U.S., 
as well as Aznar,s strong opinions on Kosovo, Turkey, and 
the Alliance of Civilizations.  President Aznar told the 
CODEL that he held real reservations about Kosovo's 
independence, concerns he mentioned he had conveyed to 
Senator Lieberman the night before.  Aznar said he believed 
international acceptance of a unilateral declaration of 
independence (UDI) would lead to three undesirable results: 
the de facto acceptance of changed borders in Europe as a 
consequence of "blackmail;" the establishment of a principle 
of self-determination that would have ramifications in Spain, 
Italy, Turkey, Iraq, and other states with minority 
populations; and the rise of nationalism on the European 
continent.  Aznar said he feared the explosive mixture of 
nationalism and changing borders and would prefer Kosovo 
remain a protectorate for the next century rather than have a 
UDI be accepted by much of the international community. 
 
¶9. (SBU) Aznar opined that Turkey's EU bid was impossible at 
present and would continue to be so for perhaps the next 15 
years.  The former president said that while Europe should 
certainly look to forge and maintain a special relationship 
with Turkey, it was hard for him to imagine a Muslim-majority 
country fitting into a Europe of Christian roots.  He said 
 
MADRID 00000098  003 OF 005 
 
 
that EU and U.S. leaders needed to consider just what the 
Turkey factor would mean to Europe with the addition of 100 
million Muslims. 
 
¶10. (SBU) Aznar voiced skepticism regarding the AOC.  He said 
during his term in office he visited Iran and worked closely 
with former Iranian President Khatemi to establish a dialogue 
of civilizations, but that he could not see the desirability 
or feasibility of forming an alliance with figures such as 
Supreme Leader Khamenei.  Aznar said that the AOC was not in 
the best interests of the West.  He mentioned that he 
maintains good relations with Turkish President Erdogan and 
claimed to have it on good authority that Erdogan was taking 
an active role in Zapatero,s AOC not because he necessarily 
believed in it, but because he hoped it would help Turkey,s 
EU bid. 
 
¶11. (SBU) Aznar concluded the meeting with a discussion of 
the role of his think tank, the Foundation for Social 
Analysis and Studies (FAES).  He said that FAES was set up in 
the European liberal tradition and was intended to defend the 
values of the western world and an Atlantic policy.  FAES 
seeks to strengthen the U.S.-EU pillar and believes that an 
Atlantic Europe is the only possibility for the continent. 
 
Renewable Energy 
---------------- 
 
¶12. (U)  At a lunch on renewable energy hosted by the 
American Chamber of Commerce, the Senators and Spanish 
companies discussed the status of several forms of renewable 
and low-emission energy.  Ambassador Aguirre and AmCham 
president Jaime Malet opened with remarks describing Spanish 
and U.S. leadership in the sector and emphasizing the amount 
of Spanish investment in renewables projects in the U.S. 
Ambassador Aguirre described the February renewable energy 
trade and investment mission post is organizing with the GOS 
to bring Spanish government officials and companies to the 
U.S.  Senators Grassley and Thune discussed biofuels, which 
Senator Grassley noted were likely to shift away from the 
present emphasis on corn-based ethanol to cellulose-based 
ethanol after the next 5-10 years.  Senators Grassley and 
Thune explained their states, favorable location for wind 
power (Iowa has Spanish investment in both wind farms and a 
wind turbine manufacturing plant), while Senator Martinez 
noted that the U.S., geographic variability meant that an 
identical national renewable portfolio standard for each 
state would be unfair to states such as Florida that lacked 
commercially viable quantities of wind.  Senator Craig and 
Ambassador Aguirre emphasized the importance of technological 
advances in addressing energy dependence and climate change. 
Senator Craig described U.S. climate change policy, outlined 
the U.S. national energy laboratories, role in technological 
research, and reviewed issues related to nuclear and clean 
coal technology.  Spanish company representatives described 
Spain,s system of incentives for electricity from renewable 
sources (Spain,s system is based on guaranteed prices, while 
U.S. incentives are mainly tax-related) and expressed 
interest in investment opportunities in the U.S. in 
electricity transmission as well as generation.  Participants 
from both countries emphasized the importance of encouraging 
renewable energy as an alternative to dependence upon 
hydrocarbon imports from undemocratic suppliers. 
 
Cuban Dissidents 
---------------- 
 
¶13. (SBU) Senators Martinez and Craig, joined by the 
Ambassador and Deputy Chief of  Mission, met January 11 with 
Cuban dissidents Hector Palacios and his wife Gisela Delgado. 
 Palacios briefed the Senators on his personal situation 
saying he had been released from jail at the petition of the 
Spanish Government in order to come to Spain to receive 
medical treatment.  While appreciated Spain,s help, he did 
not agree with Spain,s policy of engagement with the Cuban 
regime or with gestures such as the 2007 Moratinos visit to 
Cuba.  He said he and his wife had made public statements 
critical of Spanish policy and as a result the Spanish had 
cut his per diem allowance and moved him to a cheaper hotel. 
He said Moratinos had not seen him and instead he dealt with 
the Director General for Iberoamerica. 
 
¶14. (SBU) Palacios said political control in Cuba was 
fragmenting into three or four different groups.   Fidel had 
been the glue that held it together.  Each group had a 
somewhat different agenda their common goal was to stay in 
power.  Palacios said Cuba was ripe for change.  He said the 
military would not be a major obstacle once change began 
because conscription meant that the military reflected the 
people.  Also, Fidel,s policy of rotating troops regularly 
underneath their officers had had its intended effect of 
 
MADRID 00000098  004 OF 005 
 
 
preventing the formation of units personally loyal to their 
commanders.  He said a greater problem would the large system 
of repression Fidel had created (the Ministry of Interior, 
neighborhood committees, bands of thugs who attacked and 
intimidated dissidents).  There were about 200,000 people in 
this system and they were the ones who lived well and who had 
a great deal to lose.  Even those within government would 
find these people a formidable obstacle if they tried to 
promote change. 
 
¶15. (SBU) Palacios said U.S. assistance was not reaching the 
dissidents.  He noted the irony of being jailed as an agent 
of U.S. imperialism when the actual amount of USG funding was 
minimal.  He said they ran into problems doing things as 
simple as finding the small amounts of money needed to bring 
dissidents from one part of the island to another to attend 
demonstrations.  He said he planned to travel to Washington 
and Miami soon and intended to raise this issue in both 
places. 
 
National Security Advisor Casajuana and Foreign Minister 
Moratinos 
 
--------------------------------------------- ----------------- 
 
¶16. (SBU) Senators Martinez and Craig (joined by Senator 
Lieberman) met January 11 with Carles Casajuana and discussed 
Afghanistan, Lebanon, Morocco, Cuba, and the AOC.  Also on 
January 11, Codel Martinez met with FM Moratinos where the 
conversation touched on Afghanistan, the Middle East peace 
process, Syria, Venezuela, Cuba, and the AOC.  Both meetings 
are reported via septels. 
 
Agricultural Trade Issues 
------------------------- 
 
¶17. (SBU) On January 11, Senators Charles Grassley and John 
Thune, together with the Deputy Chief of Mission, AgCouns and 
EconOff, met with the Ministry of Industry, Tourism and 
Trade,s Secretary of State for International Trade, Pedro 
Mejia, and Secretary General Alfredo Bonet.  Senator Grassley 
emphasized the importance of science-based decisions in the 
agricultural biotechnology context.  Mejia said that Spain 
had a relatively "liberal" view with respect to 
biotechnology.  However, even in Spain the technology was 
controversial and faced NGO opposition, albeit not as strong 
as in some other EU member states.  Senator Thune asked what 
influence Spain could exercise in Brussels on this issue. 
Bonet noted it was very difficult to get a qualified majority 
for biotech approvals in the EU Environment Council so in the 
end the Commission was taking decisions in favor of 
biotechnology.  Both Mejia and Bonet noted that commodity 
price hikes might spur greater liberalization on biotech 
imports.  The Secretary of State asked about the status of 
the proposed elimination of the "splash and dash" tax credit 
loophole that allows biodiesel producers in the U.S. to 
import commodities such as soybeans, add a minimal amount of 
petroleum diesel, and then reexport the biodiesel.  European 
producers have complained about these imports.  The Senator 
promised to get back to the Secretary of State on the status 
of the proposed elimination of the loophole.  Mejia said that 
he was pessimistic about the prospects for Doha because major 
developing countries were not willing to give sufficiently in 
terms of industrial and services market access; he emphasized 
especially Spain,s interest in better services access.  He 
noted also that with high agricultural commodity prices, some 
developing countries now did not see why they should give on 
industrial goods and services access.  He said that the U.S. 
was still under pressure to do more on domestic agricultural 
support.  Spain's senior trade representative asserted that 
the EU had made a good agricultural access offer.  The 
Senators expressed support for Doha but were pessimistic 
about getting support for Trade Promotion Authority (TPA) 
this year.  Finally, there was a lively discussion of 
Secretary of State Mejia's February energy renewables trip to 
 
SIPDIS 
the U.S.  Both Senators Grassley and Thune were very 
interested in the mission.  (Comment: This was a very good 
substantive discussion.  However, it is clear that while 
Spain will continue sometimes to vote in favor of 
biotechnology liberalization proposals, the Spaniards will 
tread warily on this issue given their own domestic 
sensitivities and other equities Spain has in the EU.  It was 
interesting to hear Mejia,s strong emphasis on services as 
the future of Spain,s economy.  Unfortunately, Spanish 
services companies have not been aggressive in promoting 
Doha, although this is true of many other services companies 
in Europe as well.  End comment.) 
Press Coverage 
-------------- 
 
¶18. (U) ABC, EFE, Europa Press, and El Pais reported on the 
 
MADRID 00000098  005 OF 005 
 
 
visit.  El Pais published January 14 an interview with 
Senator Martinez focused on the U.S. elections, the Middle 
East peace process, and the need for democratic change in 
Cuba. 
 
¶19. (U) Senator Martinez cleared this cable. 
LLORENS