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Cablegate: Opposition Economic Spokesman: We're Watching

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS MADRID 002142

SIPDIS

SENSITIVE

STATE PASS USTR - JSANFORD

E.O. 12958: N/A
TAGS: ECON ETRD EAGR SP
SUBJECT: OPPOSITION ECONOMIC SPOKESMAN: WE'RE WATCHING
CLOSELY


1. (SBU) Summary. The Popular Party's (PP) Economic
Spokesman in Parliament Arias told us his party is watching
closely the development of the Socialist economic policy,
which he characterized as a work in progress. He described
both sides of the political aisle in Spain as strongly in
favor of a successful Doha Round, though he expected more
anxiety for Spain on cotton. Arias found the Socialist
government's decision to abstain on recent biotech votes as
encouraging, having anticipated a complete reversal of
support on biotechnology. Arias lamented the excellent shape
in which the PP had left the economy, predicting the economic
foibles of the new government wouldn't catch up them for at
least two years. End Summary.

2. (SBU) In a brief June 2 meeting, PP Economic Spokesman in
Parliament (and former Minister of Agriculture and Fisheries)
Miguel Arias Canetes told us he is watching the formation of
the government's new economic policy closely and plans to be
very active in his role as opposition economic spokesman. Of
particular concern is the budget, and how the Socialist
government will implement its many electoral promises while
maintaining promised fiscal discipline. "We'll be watching
closely" said Arias. He encouraged us to reach out to him
with any issues of concern regarding legislation in his
committee. He predicted the Zapatero government would become
less strident in its "Europe vs. the US" rhetoric after June
13 European Parilament elections.

3. (SBU) Arias described the excellent shape in which the
Aznar government had left the economy as a gift to the
Zapatero government. He predicted the Socialists would have
at least 18 months to two years of strong economic growth
before any possible economic repercussions of new policies
would begin to take effect. If the economy then started
taking a turn for the worse, he predicted the government
would call early elections to ensure they stayed in power for
another term.

4. (U) Arias predicted that Spain would continue its "helpful
and supportive" role within the EU pressing to conclude the
Doha Development Round negotiations. He took encouragement
from Commissioner Lamy's letter supporting the elimination of
agriculture subsidies, predicting the Spanish agriculture
community would go along with whatever was decided without
too much noise and difficulty. He predicted the most serious
area of concern for Spanish farmers would be cotton.

5. (SBU) To our surprise, Arias took encouragement from the
recent Spanish abstention votes on biotech events in EU
bodies. Arias had anticipated the Zapatero government would
be ardently anti-biotech. Arias interpreted the abstentions
as a sign that the professional staff of the Agriculture
Ministry was exerting an positive influence. Spanish farmers
were very pro-biotech. The professional staff at other
relevant ministries -- Environment and Health -- were also
generally pro-biotech. If the Ministers relied on their
staffs, he predicted the Zapatero government would continue
to support biotech, if not as pro-actively as the Azanr
government.

6. (SBU) Comment: Arias had an air of resignation about him,
clearing getting used to his small Parliamentarian's office
and new opposition role. We found his comments on biotech to
be encouraging, recognizing that the Spanish interagency
process has not yet met to decide a formal stance. The
appointment on Friday of Jose Ignacio Arranz as the head of
the Spanish Food Safety Agency is also an encouraging
development. We have worked closely with Arranz on biotech
over the past several years and found him to be generally
pro-biotech.

ARGYROS

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