VZCZCXYZ0002
RR RUEHWEB

DE RUEHBU #1264/01 2541918
ZNR UUUUU ZZH
R 101918Z SEP 08
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC 1992
RUCNMER/MERCOSUR COLLECTIVE

UNCLAS BUENOS AIRES 001264 
 
USDOC for 4321/ITA/MAC/OLAC/PEACHER 
NEA/IR for SARAH GROEN 
 
SIPDIS 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: ETRD ECON PTER PREL AR IR
SUBJECT: Argentina: Rising Trade with Iran Prompts Jewish Community 
Outcry 
 
------- 
SUMMARY 
------- 
 
¶1. (SBU) Bilateral trade between Argentina and Iran has grown 
rapidly in 2008, increasing to US$ 483 million in the first half of 
2008 from under US$ 5 million in the first half of 2007, driven 
mainly by Argentine agricultural exports.  Paradoxically, the 
increase in bilateral trade follows Argentina's 2007 issuance of 
international arrest warrants for five current and former Iranian 
government officials accused of participation in the 1994 bombing of 
a Jewish cultural center in Buenos Aires which killed 85.  There was 
also evidence of Iranian involvement in the 1992 bombing of the 
Israeli Embassy that killed 29 persons.  The Iranian Charge 
d'Affaires in Argentina denies that the jump in bilateral trade was 
prompted by any change in GoI trade policy.  Reaction from the 
Jewish community in Buenos Aires has been decidedly negative.  End 
Summary. 
 
--------------------------------------------- ----- 
Bilateral Trade with Iran Grows 82-fold in 2008... 
--------------------------------------------- ----- 
 
¶2. (U) According to local media reports citing official GoA 
statistics, total Argentine goods trade with Iran increased 
eighty-two times in the first half of 2008 y-o-y, from US$ 5.88 
million in the first semester of 2007 to US$ 483 million in the same 
period of 2008.  The increase was driven by Argentine exports, which 
rose from $ 4.88 million to $ 480 million, while imports from Iran 
grew from $1 to $3.2 million.  Iran rose to become Argentina's 
fourteenth-largest export market in the first half of 2008, from 
104th in the first half of 2007.  Raul Ochoa, a private sector trade 
specialist, told press that "99% of what we export" to Iran is soy 
products and corn. 
 
-------------------------------------------- 
...despite GOA pursuit of Iranian Terrorists 
-------------------------------------------- 
 
¶3. (SBU) The article attributes the 2008 increase to a change in 
Iranian trade policy.  The surge in Argentine exports to Iran 
suggests the rapid restoration of a significant trade relationship. 
Trade between Iran and Argentina had been substantial until 1998, 
when the GoA expelled Iranian diplomats after evidence surfaced of 
Iranian involvement in the 1992 bombing of the Israeli Embassy that 
killed 29 persons and the 1994 bombing of a Jewish community center 
that killed 85.  In retaliation for the expulsion of its diplomats, 
Iran suspended trade with Argentina, including $1.6 billion in 
Iranian exports and imports of about $640 million worth of grain and 
meat from Argentina.  The GoA in November 2007 won a long and 
hard-fought campaign (over Iranian objections) to get the Interpol 
General Assembly to approve the issuance of international arrest 
warrants for five current and former Iranian government officials on 
one Lebanese Hizballah leader. 
 
¶4. (U) In interviews with the local press, Iranian Charge d'Affaires 
in Argentina Mohsen Baharvand, however, denies that the increase in 
Argentine exports to Iran resulted from a specific "order" to lift 
Iranian trade restrictions, and claimed that Iran was in a process 
of privatizing foreign trade.  Local media reports an Argentine 
business leader calling Iran's earlier decision to block trade "a 
serious blow," and said that the reversal was "a pleasant 
surprise." 
 
--------------------------------------------- -------- 
Argentine Jewish Community Reaction Strongly Negative 
--------------------------------------------- -------- 
 
¶5. (U) Reaction to the increase in bilateral commerce from the local 
Jewish community has been decidedly negative.  Sergio Burstein, 
member of the Association of Family Members and Friends of the 
Victims of the AMIA attack, was quoted in the press on September 9 
that "it's disgusting" that there are businesspeople "who prioritize 
the economic and leave by the wayside" such a serious accusation. 
Aldo Donzis, President of the Delegation of Argentine-Israeli 
Associations (DAIA), was quoted in the press September 6 as saying 
"It's inconceivable that the Justice Ministry has indicated Iran as 
responsible for terrorist attacks in Buenos Aires and, as if nothing 
had happened, maintain normal trade relations.  It looks like we're 
rewarding them." 
 
------- 
Comment 
------- 
 
¶6. (SBU) The growth in bilateral Argentine/Iranian trade is notable 
in light of ex-President Nestor Kirchner's April 2007 comment: "It's 
terrible how many Argentines sometimes wish we would prioritize 
 
commercial exchanges and not find the truth about who committed 
terrible acts here in our homeland.  There is not a single coin, or 
a hundred, or billions of coins which could be traded for the loss 
of life and the evil attack that our countrymen suffered."  Burstein 
called upon current President Cristina Fernandez de Kirchner (Nestor 
Kirchner's wife) to "block exports to Iran" until the accused are 
brought to justice.  The lack of such a decision thus far may 
indicate a Casa Rosada decision to curry favor with estranged 
agricultural interests.  It is just as likely, however, to be a 
trade development that occurred because of Iranian actions (perhaps 
a conscious Iranian decision to make the trade relationship more of 
a lever) that has until now escaped the notice of a GoA preoccupied 
with more pressing concerns. 
 
WAYNE