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C O N F I D E N T I A L SECTION 01 OF 03 ROME 000755 
 
SIPDIS 
 
E.O. 12958: DECL: 06/25/2019 
TAGS: PGOV PREL IT
SUBJECT: SCENESETTER FOR THE PRESIDENT'S PARTICIPATION IN 
THE G8 L'AQUILA SUMMIT, JULY 8-10 
 
ROME 00000755  001.2 OF 003 
 
 
Classified By: Charge d'Affaires Elizabeth Dibble for Reason 1.4 (b) 
and (d) 
 
Mr. President, welcome to L'Aquila. 
 
¶1.  (C) BEGIN SUMMARY: This G8 Summit in L'Aquila is the 
culmination of a busy year for the Italian G8 Presidency. 
Prime Minister Berlusconi is very pleased to host this event, 
to host you, and to demonstrate his role as elder statesman 
of the G8 ""club.""  In Italy, all eyes will be on Berlusconi 
and how he handles this summit, which comes while the Italian 
and foreign press are full of lurid allegations involving his 
personal life. With members of Berlusconi's party fearing 
that new allegations will come out before or during the 
summit, the Prime Minister is hoping to use the event to 
demonstrate that he is respected internationally. 
 
¶2.  (C) Italy has fielded an overly-ambitious G8 agenda in 
2009, addressing global financial stability (while 
acknowledging G20 primacy in this area), sustainable 
development (particularly with regard to Africa), climate, 
energy security, Afghanistan/Pakistan, non-proliferation, 
piracy, food security and global trade.  Forging a consensus 
on these issues has been a painstaking process but Italy has 
done its best to channel its unwieldy ambitions into an 
outcome that is acceptable to its G8 partners and which lays 
the groundwork for effective future action. That said, a 
proliferation of issues and an ever-expanding roster of 
invitees has characterized the Italian effort, detracting 
from the cohesiveness of the event, and perhaps from the 
Italians' ultimate goal of ensuring that the G8 remain 
relevant.   END SUMMARY. 
 
¶3. (C)  Mr. President, welcome to the G8 Summit in L'Aquila. 
PM Berlusconi has been looking forward for months to playing 
host to his third G8 Summit.  He is also looking forward to 
seeing you again after your very positive June 15 meeting in 
Washington.  The Summit was originally scheduled to take 
place on the island of La Maddalena, off the coast of 
Sardinia, and construction on the Summit venue was well 
underway when in April 2009 Berlusconi announced that the 
Summit would be moved to L'Aquila, site of the April 6, 2009 
earthquake that killed 298 and left 65,000 displaced. 
Berlusconi's rationale was that the event would bring 
much-needed revenue to the stricken area and impart to the 
Summit a ""sober"" tone more in tune with the current austere 
economic times than the resort-studded coastline of Sardinia. 
 L'Aquila, a beautiful medieval city nestled in the heart of 
the Appenine Mountains, is still recovering from the April 6 
quake.  Many residents are still living in tents and historic 
buildings in the downtown core are held together by steel 
bands as crews work around the clock to rebuild. 
 
----------------------------------------- 
President Berlusconi's Political Fortunes 
----------------------------------------- 
 
¶4. (C)  PM Silvio Berlusconi is currently embroiled in 
scandals concerning his private life, including allegations 
of improper sexual relationships. In turn, Berlusconi has 
aggressively gone on the offensive, blaming this situation on 
a plot orchestrated by international and domestic enemies in 
an effort to smear his name prior to the G8 Summit. 
Historically, Berlusconi's many domestic opponents have 
chosen to launch their ""attacks"" during high-profile 
international conferences being held in Italy: in 1994, at 
the Naples UN ministerial on transnational crime, Berlusconi 
was charged with corrupting the Italian financial police; in 
2001, Milan judges charged him with tax fraud shortly before 
he hosted the G8 in Genoa (he was not convicted of either 
charge). Now press and political circles in Rome are buzzing 
with potential new dramatic revelations. Traditionally the 
Italian electorate has been disinterested in international 
attitudes towards Italy's leaders, and has been unmoved by 
peccadilloes in the personal lives of its politicians. 
However, the salaciousness of the charges against Berlusconi, 
and the growing impression that he is not taken seriously 
abroad has heightened the importance of this summit for the 
Prime Minister. He almost certainly sees it as an opportunity 
to recover his public persona abroad, while dramatically 
demonstrating his role as an international statesman at home. 
Given the intense importance that this G8 summit has now 
taken for domestic politics, any Berlusconi gaffes or 
perceived snubs by other world leaders will receive 
tremendous attention by the Italian media. 
 
----------- 
The Economy 
----------- 
 
¶5. (C)  Berlusconi is vulnerable to being seen by the public 
as failing to step up to the real economic problems 
confronting Italy.  The global economic crisis may be getting 
ready to bite harder here - some observers are predicting a 
""double dip"" recession.  Savings are already being run down, 
credit is both more expensive and increasingly harder to 
obtain and unemployment continues to tick upward.  Italy's 
economic growth rate -- which was relatively low even before 
the crisis -- has dropped precipitously owing to sharp 
contractions in its export markets and falling domestic 
demand.  Unemployment is expected to exceed eight percent 
this year and to rise further in 2010.  Government tax 
revenues are, not unexpectedly, off sharply.  Italy's already 
high level of government debt and the debt ceilings that come 
with euro membership significantly limit the government's 
ability to provide fiscal stimulus for the economy. 
 
---------- 
The Summit 
---------- 
 
¶6.  (C) This G8 Summit is the culmination of a busy year for 
the Italian G8 Presidency. Italy will host a record nine G8 
Ministerial Meetings this year throughout Italy, and will 
have hosted over 80 G8 Sherpa, Sous-Sherpa, Political 
Director and Working Group meetings by the time the L'Aquila 
Summit begins. 
 
¶7. (C)  While as of June 26, the final agenda was still being 
worked out, Italian G8 Sherpa, MFA Secretary General 
Giampiero Massolo, publicly touted the G8's main priorities 
this week as ""promoting the global agenda"" (defined as the 
""global standard"" and a ""detax proposal"") and ""demonstrating 
that the G8 still makes sense.""  The reality is that efforts 
to refine the agenda and offer a clear focus are coming late: 
Italy's Presidency has been characterized by a proliferation 
of themes, the sheer number of which has diluted the clarity 
of any eventual G8 message.  This failure to focus their G8 
message may have been due in part to Italy's internal 
disorganization throughout the process, and desire to cover 
the waterfront on possible issues of global relevance.  While 
the Italians had earlier hopes of ""deliverables"" (e.g., 
anti-piracy) that have run into immovable objections, it 
seems they do not at this point have substantial objectives 
on G8 issues, and have viewed their role as principally to 
shepherd discussions to agreement. 
 
¶8. (C)  The proliferation of themes has been matched by an 
ever-expanding number of invitees.  In keeping with recent G8 
practice, in addition to the G8 and the EU, Italy is inviting 
to the Summit the ""Outreach 5"" countries of the ""Heiligendamm 
Process"" (China, India, Brazil, Mexico and South Africa), the 
countries participating in the Major Economies Forum (MEF) on 
Energy and Climate (G8   Outreach 5   South Korea, Australia 
and Indonesia) and the African countries of the NEPAD group 
(New Partnership for African Development -- Libya, Egypt, 
Algeria, Senegal, Nigeria and Ethiopia).  In addition, Italy 
has invited Egypt to the Outreach 5 session, Denmark to the 
MEF Session (in its capacity as host of the December 2009 UN 
Climate Change Conference) as well as Spain and the 
Netherlands, making this the biggest G8 Summit ever and 
surpassing the G20 in size. 
 
¶9.  (C) Many G8 partners have been critical of the size and 
scope of this G8, as well as of Italy's occasional preference 
for form over substance and its at times lackadaisical 
approach to crafting G8 statements.  Italy's ambitious agenda 
may have been driven in part by its fear that the G8 would 
become irrelevant on Italy's watch.  French President 
Sarkozy's public questioning of the G8's relevance and UK PM 
Gordon Brown's successful bid to make the G20 the premier 
leaders' forum for addressing the global economic crisis have 
contributed to this concern,
 and have spurred Italy to expand 
G8 ""outreach"" to make it more inclusive and thematically 
wide-ranging.  This tendency has its drawbacks and its 
benefits --  Italy has been very open to U.S. efforts to 
highlight the importance of the Major Economies Forum this 
year, for instance, even though to do so may steal the 
spotlight from the G8 sessions. 
 
------- 
Comment 
------- 
 
¶10. (C)  This year's G8 Summit has evolved via something of a 
""bottom up"" approach due to lack of focused leadership from 
the top. The chaotic development of various themes has 
resulted from the at-times competing interest of key 
political players and Ministers, each seeking to make a 
splash via an important, but often ill-prepared, initiative. 
As the event approaches, PM Berlusconi is fully engaged, 
viewing the summit as an opportunity to show himself a 
statesman and showcase Italy.  Italian officials from the 
outset and throughout planning for the event have been eager 
to accommodate and support USG priorities, wishing to be in 
lockstep with our policies wherever possible.  PM Berlusconi 
returned elated from his meeting with you in Washington, and 
there was a collective sigh of relief across the board that 
warm relations with the US were intact despite the change of 
administration.  Your visit has special meaning to the 
Italian government and public, and Italian officials will 
work with you and your staff to make this event a success. 
 
¶11. MINIMIZE CONSIDERED 
 
DIBBLE 
"