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Cablegate: Argentine President's Low-Profile Participation in Eu - Lac

VZCZCXYZ0000
RR RUEHWEB

DE RUEHBU #0687/01 1412120
ZNR UUUUU ZZH
R 202120Z MAY 08
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC 1103
INFO RUCNMER/MERCOSUR COLLECTIVE
RUEHBS/USEU BRUSSELS
RUEHPE/AMEMBASSY LIMA 2300
RUEHMD/AMEMBASSY MADRID 2072
RUEHBS/AMEMBASSY BRUSSELS 0116
RUEHTC/AMEMBASSY THE HAGUE 0190
RUEHLJ/AMEMBASSY LJUBLJANA 0004
RUEHME/AMEMBASSY MEXICO 1580
RUEHFR/AMEMBASSY PARIS 1416
RUEHDL/AMEMBASSY DUBLIN 0022
RUEHRL/AMEMBASSY BERLIN 1105
RUEHQT/AMEMBASSY QUITO 1086
RUEHLO/AMEMBASSY LONDON 1252

UNCLAS BUENOS AIRES 000687

SENSITIVE

SIPDIS

E.O. 12958: N/A
TAGS: PREL PGOV EAGR ECIN ECON ENRG ETRD ETTC SOCI TSPL
XM, EU, AR
SUBJECT: ARGENTINE PRESIDENT'S LOW-PROFILE PARTICIPATION IN EU - LAC
SUMMIT

REF: (A) BUENOS AIRES 642, (B) BUENOS AIRES 660, (C) BUENOS AIRES
496

1. (SBU) Summary: President Cristina Fernandez de Kirchner (CFK)
met (low) expectations (ref A) at the Summit Meeting of Leaders of
the European Union - Latin America and the Caribbean ( EU - LAC),
holding a number of bilateral meetings but dodging the press. In
the Mercosur - EU bilateral, CFK reportedly clashed with Commission
head Jose Manuel Durao Barroso over tariff concessions, with CFK
reportedly insisting the EU owed Mercosur asymmetric concessions
because of the EU's wealth and Barroso calling for a broader view of
gains to be made with a Doha agreement. In a short meeting with
Chancellor Merkel of Germany, CFK discussed the economic
relationship between the EU and Mercosur. President Zapatero of
Spain used his time with her to defend Spanish businesses in
Argentina, including those with a controlling interest in Aerolineas
Airlines (ref B). On a more positive note, a short meeting with
Bolivian president Evo Morales produced an announcement from his
nation's Minister of Hydrocarbons and Energy that promised a flow of
natural gas to Argentina. Also, in the closing session of the
summit, CFK and Chilean President Michelle Bachelet together called
for an alliance between Latin America and the European Union to
jointly confront the global food crisis. Whether clashing or
cooperating with counterparts at the summit, the Kirchner delegation
shut out the media, offering no press releases, background or on the
record briefings. END SUMMARY.

Bilaterals Live Up to Low Expectations
--------------------------------------

2. (SBU) As predicted by post contacts, CFK's bilateral meetings
produced little in the way of concrete results (ref A). An
eighteen-minute meeting with Chancellor Merkel of Germany prior to
the start of the summit consisted of a general conversation about
"the economic relationship between both countries, bilateral
questions, and the relationship between the European Union and
Mercosur." In the wake of a deal to "argentinize" a portion of
Spanish company Marsans' stake in Aerolineas Airlines, President
Zapatero of Spain commented after his meeting with CFK that "the
relationship between the government of Spain with the government of
Argentina is an extraordinarily fluid relationship, but announced
that his country was "going to defend" its business interests in
Argentina.

3. (SBU) The Mercosur-EU bilateral reportedly produced a clash
between the Argentine president and head of the European Commission
Jose Manuel Durao Barroso over tariff concessions. He stated that
"the countries of Mercosur have much to gain in agriculture, but
they are not going to gain this if they do not make concessions in
the area of industry and services." Press reports indicate that his
meaning between the lines was that any trade accord, including one
reached through Doha talks, would require Latin American tariff
reductions on industry and services to balance tariff reductions on
Mercosur agricultural products. CFK agreed that "if you reduce one
side you reduce the other," but apparently firmly opposed balanced
concessions, arguing that Latin America's lower level of development
and higher poverty levels meant it should shoulder a lesser burden.
An EU diplomat in Buenos Aires told us EU staff got the impression
that CFK, who showed up without any other Mercosur partners, was
"winging it" with her arguments.

4. (SBU) To address domestic energy concerns, CKF held a private,
15-minute conversation with Bolivian president Evo Morales in which
she pledged support for his political reorganization and upcoming
referendum on his political mandate. Afterward, Morales expressed
to the press his appreciation for his "companera Cristina" and his
Minister of Hydrocarbons and Energy Carlos Villegas announced that
"we are going to guarantee the production of gas, as we indicated to
Argentine authorities." The Buenos Aires Herald characterized
Bolivia's assurances regarding winter natural gas supplies to
Argentina as "a meaningless pledge," noting that Morales has failed
to live up to contractual obligations before.

5. (U) During the summit discussion on "Poverty, inequality, and
social inclusion," CFK and Chilean president Michelle Bachelet
jointly called attention to the problem of rising food prices.
President Kirchner called for a joint effort between Europe and
Latin America to link EU investment and technology with Mercosur
energy resources and food production capacity. The two leaders'
call was written into the Lima Declaration, which stated that the
leaders agreed "immediate measures are needed to assist the most
vulnerable countries and populations" and they support "the
development of the 'Latin America and the Caribbean without hunger'
FAO initiative."

6. (SBU) CFK did not hold a bilateral meeting with Hugo Chavez. In
a brief press interview, the Venezuelan leader explained this was
because the summit was not the best place to talk. He went on to
state that he and CFK are "strategic allies and close friends," and
that the nationalization of Sidor (ref C) had not affected
Venezuelan-Argentine relations. In his words, bilateral relations
with the GOA "are at their maximum and best level," and he
highlighted the upcoming groundbreaking of a regasification plant to
provide Argentina with Venezuelan natural gas. Chavez also claimed
he had asked CFK to foster his reconciliation with Merkel, whom he
had publicly claimed was "to the right of Hitler." By way of
apology, Chavez approached Merkel when she was sitting next to CFK
and told the two that whenever he misbehaved, CFK slapped him on the
wrist. According to "La Nacion," CFK smiled at Chavez's joke, but
Merkel did not.

Radio Silence and a Skeleton Crew
---------------------------------

7. (U) The press noted that CFK and her delegation maintained almost
complete silence over the course of the summit, not offering a
single press conference or press release. By comparison, other
leaders, including Bolivia's Morales, Spain's Zapatero, and
Germany's Merkel held court more than once with international press.
Argentine pundits are calling this a strategic move to control
outcome and message, likely advised by her husband. They gave a
similar interpretation to CFK's tendency at the summit to attend
meetings alone or accompanied only by Foreign Minister Jorge Taiana
or Ambassador to Peru Dario Alessandro. The one quote attributed to
CFK, on the run between meetings, was her half-in-jest remark
directed at Argentine journalists: "You are going to behave
yourselves, aren't you?"

Comment
-------

8. (SBU) The GOA had been hoping that CFK's participation at the
EU-LAC Summit would advance her goal of reinserting Argentina onto
the international stage, or at least give her a break from pressing
problems at home. But Argentine press portrayal of CFK's 24 hours
in Lima stressed Argentina's lingering estrangement from the
Europeans, due to unresolved investment disputes and fallout from
Argentina's debt default. It also noted that she was primarily
preoccupied with developments at home regarding the GOA's ongoing
conflict with the striking agricultural sector.

WAYNE

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