ID:92466
    Date:2007-01-12 17:32:00
    Origin:07MADRID71

VZCZCXRO7157
OO RUEHAG RUEHBC RUEHDE RUEHDIR RUEHKUK RUEHROV
DE RUEHMD #0071/01 0121732
ZNY SSSSS ZZH
O 121732Z JAN 07
FM AMEMBASSY MADRID
TO RUEHC/SECSTATE WASHDC IMMEDIATE 1617
INFO RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY
RUCNIRA/IRAN COLLECTIVE PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RUEKJCS/SECDEF WASHDC PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RUCNDT/USMISSION USUN NEW YORK PRIORITY 0282
RUEHNO/USMISSION USNATO PRIORITY 1454
RUEHUNV/USMISSION UNVIE VIENNA PRIORITY 0049
RUEHBS/USEU BRUSSELS PRIORITY
    
S E C R E T SECTION 01 OF 04 MADRID 000071 
 
SIPDIS 
 
NOFORN 
SIPDIS 
 
DEPARTMENT FOR EUR/WE; UNVIE FOR AMB SCHULTE 
 
E.O. 12958: DECL: 01/12/2017 
TAGS: PARM PREL, MNUC, MASS, PINS, PTER, SP 
SUBJECT: SPAIN:  UNVIE AMBASSADOR SCHULTE RAISES AWARENESS 
OF POTENTIAL IRANIAN NUCLEAR THREAT 
 
Classified By: DCM HUGO LLORENS PER 1.4 (B/D) 
 
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SUMMARY 
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1.  (U)  UNVIE Ambassador Greg Schulte visited Madrid January 
10-11 to raise the awareness of GOS officials and the public 
regarding the threat posed by the ongoing Iranian nuclear 
weapons program.  On the government side, Schulte met with 
National Security Advisor Carles Casajuana, Deputy Foreign 
Minister Bernadino Leon, and five influential members of the 
Congress' Defense and Foreign Relations Commissions (from 
both the governing and the major opposition party).  Schulte 
also met with nonproliferation experts from leading Spanish 
think tanks, held a well-attended media roundtable, and 
conducted a one-on-one press interview with Spain's leading 
conservative daily newspaper. 
 
2.  (S/NF)  Leon told Schulte that U.S.-European "unity and 
pressure" were key in the effort to constrain the Iranian 
nuclear weapons program.  He said Spain was concerned that a 
nuclear weapon-armed Iran could lead Arab states such as 
Saudi Arabia and Egypt to seek nuclear weapons and that this 
could in turn encourage Spain's neighbors in the Maghreb to 
seek such weapons.  Leon said that Spain was actively 
discouraging Spanish companies from operating in Iran.  He 
said Spain would support additional EU measures against Iran, 
beyond those mandated by UNSCR 1737.  He underscored Spain's 
enormous faith in EU foreign policy chief (and Spanish 
national) Javier Solana and indicated that Spain would 
support whatever additional measures Solana tables for EU 
consideration.  Leon also said that former Spanish Prime 
Minister Felipe Gonzalez would not travel to Iran again. 
 
3.  (S/NF)  Casajuana agreed that unity and pressure were key 
but was less forward-leaning in the discussion of possible 
additional EU measures beyond UNSCR 1737, stressing that 
Europe should wait until IAEA DG ElBaradei tables his next 
60-day report (21 February) before considering additional 
measures.  Casajuana stressed that greater efforts to resolve 
the Israeli-Palestinian conflict could reduce Iran's regional 
influence and thus directly assist efforts to constrain its 
nuclear weapons program.  He also noted that the safety of 
Spanish soldiers deployed in Afghanistan near the border with 
Iran and in Lebanon in Iranian-backed Hizbollah controlled 
territory impacted on Spain's approach toward Iran. 
 
4.  (S/NF)  Leon was more sympathetic to Schulte's proposals, 
but he has a track record of getting ahead of Spanish policy 
and not always fully or quickly delivering on his 
commitments.  Casajuana's caution was likely a better 
indicator of current GOS policy on the Iranian nuclear issue. 
That said, Schulte's visit helped insure that Spain will 
continue to back the EU3 efforts and that Iran will not be 
able to drive wedges between Spain and either the EU3 or the 
U.S.  However, we do not expect that Spain will take a 
leadership position in encouraging the EU to take measures 
beyond those mandated in UNSCR 1737.  The best way to ensure 
Spain's support for additional measures remains via Javier 
Solana.  END SUMMARY. 
 
----------------------------------------- 
MEETING WITH DEPUTY FOREIGN MINISTER LEON 
----------------------------------------- 
 
5.  (U)  In his meeting with Leon and all other 
interlocutors, Schulte stressed that President Bush had 
instructed him to work closely with our European allies to 
meet the challenge posed by the Iranian nuclear weapons 
program.  He said that while passage of UNSCR 1737 took 
longer than we hoped and was weaker than we liked, it was 
still very significant for three reasons:  (1) it was passed 
unanimously; (2) it places Iran in the company of the likes 
of the DPRK and Sudan under Chapter 7 sanctions; and, (3) its 
limited sanctions have real bite and have already had an 
impact in Tehran.  Schulte said that we need to work together 
to ensure that UNSCR 1737 is implemented while we wait for 
IAEA DG ElBaradei to issue his next 60-day report on February 
21.  But in the meantime, the U.S., Europe and others (e.g., 
 
MADRID 00000071  002 OF 004 
 
Japan) need to start escalating pressure on Iran by agreeing 
to additional measures beyond those mandated in 1737, while 
simultaneously giving Iran a way out by reiterating that the 
June 2006 "carrots" package remains on the table.  He said 
that these additional measures should probably be in the 
economic/financial area, and could include reducing exports 
credits and prohibiting arms sales to Iran. 
 
6.  (S/NF)  Leon said that Spain's assessment of Iranian 
intentions tracked with that of the U.S. and that the two key 
words describing GOS views on this issue were "pressure and 
unity."  He said that pressure was beginning to modify 
Iranian behavior, in part because Iran knows that Europe and 
the U.S. are united.  Spain will continue to support U.S./EU3 
efforts on Iran and senior Spanish officials will continue to 
reiterate this in public comments.  Leon indicated that Spain 
was concerned that a nuclear-armed Iran could lead Arab 
states such as Saudi Arabia and Egypt to seek nuclear weapons 
and that this could in turn encourage Spain's neighbors in 
the Maghreb to seek such weapons.  As a result, Spain had 
formed an inter-ministerial working group under former 
Spanish Ambassador to Iran Leopoldo Stampa to analyze the 
proliferation impact of a nuclear-armed Iran.  Leon 
encouraged Schulte to meet with Stampa.  (Note:  Schulte was 
not able to do so and Embassy Madrid will ensure that Schulte 
is appraised of the results of Stampa's study.  End Note). 
 
7.  (S/NF)  Leon agreed that further economic/financial 
measures could help increase the pressure on Iran.  He said 
that Spain has been telling its companies not to invest in 
Iran and has encouraged Spanish companies already in Iran, 
such as the BBVA bank, to close down their Iranian 
operations.  He said BBVA, the only Spanish bank active in 
Iran, was in the process of closing down its Iranian 
operations and that Iran was doing all it could to slow 
BBVA's departure.  Leon underscored that Spain would support 
whatever additional measures Javier Solana comes up with. 
"Javier has the lead; what he tables, we will support."  Leon 
closed his remarks by repeating that Spain fully backs the 
EU3 and that there is a "very strong consensus within the EU" 
on Iran. 
 
8.  (S/NF)  Ambassador Aguirre, who accompanied Schulte to 
the meeting, thanked Leon for GOS support in preventing a 
recent civil aircraft sale by a Spanish company to Iran 
(reported septel) and underscored the need for increased 
vigilance, as Iran will certainly attempt to woo Spanish 
companies to fill gaps created by the departure of other 
European companies.  He said that the U.S. and Spain must 
continue to work together to keep Spanish companies out of 
Iran.  He also raised former Spanish Prime Minister Felipe 
Gonzalez's travel last year to Iran, noting that this sent a 
mixed message.  Leon said that Gonzalez had fully briefed 
senior Spanish and U.S. officials about his travel and that 
his involvement "was now over."  He repeated that "Felipe has 
decided not to travel to Iran again" but noted that Gonzalez 
remained available as a mediator should we ever need him. 
 
--------------------------------------------- --- 
MEETING WITH NATIONAL SECURITY ADVISOR CASAJUANA 
--------------------------------------------- --- 
 
9.  (S/NF)  Schulte, who was accompanied by the DCM, repeated 
his message outlined in paragraph four above, stressing that 
when the U.S. and Europe are apart, bad things happen, and 
that when we are together, we can stop wars.  He mentioned 
that Leon had emphasized pressure and unity in his meeting 
the previous day.  Casajuana said that Leon had stolen his 
talking points and underscored that the key point was to 
maintain and strengthen the U.S.-EU consensus on the Iranian 
nuclear program.  He said that Spain would fully implement 
UNSCR 1737 and had already taken measures to do so. 
Casajuana agreed that putting Iran under Chapter 7 sanctions 
had had a big psychological impact on Iran and that it was 
time to "strengthen our position and unity on Iran."  He 
noted that Spain was not in either the UNSC of the EU3 and 
would "follow U.S. and EU3 leadership on Iran."  He stressed 
that Spain would in particular support Solana's Iran efforts. 
Casajuana said that during his visit to Spain late last 
year, Iranian negotiator Larijani was clearly told that Iran 
 
MADRID 00000071  003 OF 004 
 
must comply with the demands of the U.S./EU3.  "We closed the 
door to all back ways of dialogue and negotiation and told 
Larijani to negotiate with Solana." 
 
10.  (S/NF)  Regarding additional measures beyond those 
contained in UNSCR 1737, Casajuana said "we need to think" 
and "should not be in a hurry."  He said we should wait until 
ElBaradei delivers the next 60-day report on February 21 
before engaging seriously on additional measures.  Casajuana 
said Spain could support additional measures if Russia and 
China were on board.  His message was "keep the consensus and 
build on it, even it takes longer than we like."  He said 
that we also needed to continually remind the Iranian 
government and people of the carrots on the table (i.e., that 
there is a way out that would allow Iran to have a peaceful 
nuclear program and gain significant western cooperation). 
 
11.  (S/NF)  Schulte said that Iran was clearly trying to 
drive wedges between Russia/China and the U.S/EU3 and had 
also tried to drive wedges between Spain/Italy and the EU3. 
He said we appreciated Spain's clear "no" to Iran's attempts. 
He agreed on the need to reiterate the carrot offer and 
better explain it to the Iranian people.  Schulte underscored 
that Europe has economic/financial leverage over Iran and 
needs to use it now via additional measures beyond those in 
UNSCR 1737.  He stressed that while the U.S. used to handle 
the sticks and the EU the carrots, the U.S. had agreed to 
join the June 2006 carrot package and it was now time for the 
EU to do more on the stick side via additional measures. 
 
12.  (S/NF)  Casajuana said that Iran's emergence as a 
regional power was making it feel immune to our pressure.  He 
said that the conflicts in Afghanistan and Iraq, as well as 
the Israeli-Palestinian dispute, had increased Iranian 
regional influence.  Reducing that influence might help our 
efforts to convince Iran to give up its nuclear weapons 
program.  One way to do this, he noted, would be through 
greater efforts to resolve the Israeli-Palestinian dispute. 
He also said that the presence of 700 Spanish troops in 
Afghanistan, many of them near the border with Iran, and 
1,100 Spanish troops in Hizbollah-controlled territory in 
Lebanon means that Iran could easily "make mischief" for 
Spain.  While arguing that this factor was not linked to 
Spain's Iran policy, Casajuana underscored that "this is 
always in our minds." 
 
13.  (S/NF)  Schulte stressed that Secretary Rice would make 
greater efforts on the Israeli-Palestinain conflict over the 
coming two years and that the outcome in Iraq would also have 
great influence on Iranian behavior.  If we succeed in Iraq, 
Iranian influence would be reduced.  But if we fail, it would 
boost both Iran and terrorism.  He underscored that Iran was 
already killing coalition soldiers in Iraq via the provision 
of sophisticated IED technology. 
 
14.  (S/NF)  The conversation ended with Casajuana 
reiterating the need to wait for the next 60-day report 
before considering further measures and Schulte reiterating 
that the EU needs to undertake such measures now.  Schulte 
concluded by noting that Prime Minister Zapatero had told 
Ambassador Aguirre in their first meeting that Iran was our 
greatest long-term security challenge.  President Bush agrees 
and the time for both the U.S. and Europe to act is now. 
 
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COMMENT 
------- 
 
15.  (S/NF)  Leon was more sympathetic than Casajuana to 
Schulte's message.  But Leon has a track record of getting 
ahead of Spanish policy and is not always able to fully or 
quickly deliver on his commitments.  While Leon's comments 
about encouraging Spanish companies and Felipe Gonzalez to 
stay out of Iran were probably accurate, Casajuana's caution 
was likely a more accurate reflection of overall GOS policy 
on the Iranian nuclear issue.  That said, Schulte's visit 
will help insure that Spain will continue to back the EU3 
efforts and that Iran will not be able to drive wedges 
between Spain and either the EU3 or the U.S.  However, as 
Casajuana clearly signaled, we do not expect Spain to take a 
 
MADRID 00000071  004 OF 004 
 
leadership position in encouraging the EU to take measures 
beyond those mandated in UNSCR 1737.  The best way to ensure 
Spain's support for additional measures remains via Javier 
Solana.  If Solana can build a EU consensus around additional 
measures, Spain will almost certainly support it. 

Aguirre