US embassy cable - 04ZAGREB552

C O N F I D E N T I A L  ZAGREB 000552 
 
SIPDIS 
 
 
E.O. 12958: DECL: 03/31/2014 
TAGS: PREL, ETRD, HR, QA, IS, SY, Trade 
SUBJECT: MESIC PLEASED WITH MIDDLE EAST VISIT 
 
REF: ZAGREB 533 (NOTAL) 
 
Classified By: Nicholas M. Hill, Political-Economic Counselor, for reas 
ons 1.5 (B) and (D). 
 
Summary 
 ------- 
 
1.   (C) In a meeting on March 27 with the Ambassador 
arranged to discuss a Croatian proposal to refit a Libyan 
military vessel (ref), Croatian President Stipe Mesic spent 
most of his time discussing his recent visit to the Middle 
East.  He said he had a very full schedule of meetings in 
Damascus, Amman, and Doha.  He described a world of 
difference between a "gloomy" Syria on the one hand and a 
more vibrant and "happy" Jordan and Qatar on the other.  He 
met with the leaders of all three countries and was 
optimistic about boosting economic contacts.  In Syria, 
Croatia's national oil company, INA, has made an important 
discovery in fields east of Damascus.  In a one-on-one 
meeting with President Assad, Mesic urged the Syrian leader 
to accept the reality of Israel and oppose terrorism.  End 
summary. 
 
Jordan and Qatar Bustling 
------------------------- 
 
2.   (C) President Mesic briefed the Ambassador March 27 
about his recent trip to the Middle East.  He said it went 
well, and that he was optimistic about increased Croatian 
trade with the three countries that he visited.  He was 
particularly upbeat about his stops in Jordan and Qatar.  In 
Jordan, he met with King Abdullah.  It was Mesic's third 
visit to Amman.  The country is "opening up."  Mesic 
described a lively place unlike any other Arab country. 
Croatia should look at Jordan's experience with free trade 
zones as a possible model to be adopted back home to spur 
investment and commerce in Croatia's war affected regions. 
He was pleased to tell the Ambassador that a Jordanian 
business delegation would travel to Croatia later this year 
to look at opportunities.  Also, King Abdullah told him that 
he wants to increase university-level exchanges between the 
two countries. 
 
3.   (C) In Qatar, Mesic met with the Emir.  The Croatian 
president saw a similarly vibrant place.  Doha was bustling. 
Croatian companies were interested in investing in Qatar's 
cement industry.  The Qataris want to promote more exports of 
natural gas to Europe and are looking to invest in a facility 
to transship liquefied natural gas (LNG), primarily to Italy, 
Slovenia, and Croatia.  Ploce is one possible location for a 
facility, but most of the talk now is of making an investment 
in Krk, an island just off of Croatia's primary port of 
Rijeka, in the northern Adriatic.  According to Igor Dekanic, 
who in addition to being Mesic's top domestic policy advisor 
is an oil industry expert, an LNG facility must be on highly 
stable ground, and Krk is probably the best -- if not only -- 
site in the Adriatic.  Mesic was optimistic about Krk's 
prospects.  He told the Ambassador that the Emir wants to pay 
a visit to Croatia in early July. 
 
Syria Gloomy 
------------ 
 
4.   (C) Syria was the most problematic stop for Mesic on his 
swing through the region.  The country was "gloomy" and 
reminded the president of Croatia back in the seventies, 
statist in orientation, and depressing.  Mesic said he met 
alone with President Assad and -- as he promised he would do 
when he met the Ambassador prior to the trip  -- conveyed USG 
concerns about the Syrian regime.  Assad came across as a 
"civilized man" who inherited a creaky and repressive state 
apparatus.  The Syrian president seemed to be resolved in his 
desire to carry out reforms, but it was difficult.  Mesic 
underscored with Assad that the Syrian regime should 
"recognize reality," including the "reality of Israel."  It 
was an illusion to think otherwise.  Mesic said he tried to 
steer the conversation in this direction, but it was clear 
that taking such a course "was not easy for Assad."  Mesic 
said the Syrian president needed to be "engaged more" by 
western interlocutors.  Assad will have to "break the regime 
structures" he inherited from his father.  According to 
Mesic, Assad denied any links to -- or cooperation with -- 
terrorist organizations. 
 
5.   (C) Mesic's more immediate purpose in visiting Syria was 
to look at the progress of INA, the Croatian national oil 
company, which has made a major discovery in Syria.  Dekanic 
told us later that INA's investment was modest by western 
standards, only $80 million, but there are some 500 Croatians 
now on the ground in Syria, and this was a big breakthrough 
 
for the Croatian company.  Mesic indicated that Assad was 
ready to open the doors to more business exchanges.  Croatia 
was in the process of opening up an honorary consulate in 
Damascus.  Overall, however, Syria was in a "difficult" 
economic situation, and opportunities for Croatian companies 
were not nearly as great as they were elsewhere in the Middle 
East. 
 
FRANK 
 
 
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