US embassy cable - 04MADRID2204

C O N F I D E N T I A L MADRID 002204 
 
SIPDIS 
 
FOR EB/ODF ROLAND DEMARCELLUS 
EB/IRAQ MARK KISSEL 
 
E.O. 12958: DECL: 06/10/2014 
TAGS: EAID, ECON, EFIN, IZ, SP 
SUBJECT: MIXED SIGNALS ON IRAQ ASSISTANCE PLEDGES 
 
 
Classified By: Economic Counselor Judy Garber for reasons 1.4 (b) and ( 
d) 
 
1. (C) An article in the June 9 issue of El Pais quotes 
Foreign Minister Moratinos as saying the GOS is reconsidering 
its USD 300 million pledge towards Iraq reconstruction.  The 
article suggests the review comes because so little has been 
used.  This statement seems to contradict Foreign Minister 
Moratinos, late April statement in Washington that Spain 
would maintain its aid commitments to Iraq. 
 
2. (C) It also seems at odds with repeated assurances by our 
contacts at MFA and the Ministry of Economy.  As recently as 
last week, Director General of International Finance in the 
Ministry of Economy and Finance Ramon Guzman Zapater confided 
to us that Vice President and Minister of Economy Pedro 
Solbes instructed him to carry out the pledges Spain made at 
the Madrid Donors' Conference. 
 
3. (U) The Ministry of Foreign Affairs and Ministry of 
Economy share responsibility for Spain's aid pledge.  Of the 
total $300 million pledge made at the Donors, Conference, 
$100 million has already been disbursed.  Our understanding 
of the breakdown of the remaining $200 million provided by 
our contacts in the Ministry of Economy follows: 
 
4. (U) Year 2004 (some of which has been disbursed) 
Total: $ 60 million 
IRFFI: $ 20 million (Min. Econ) 
IFC Small Business Facility: $ 5 million (Min. Econ) 
Production of Iraqi Dinars: $18 million (Min. Econ) 
Not programmed: $ 17 million (Min. Econ and MFA) 
 
5. (U) Years 2005-2007 (Note: this allocation is notional and 
will likely change) 
Total: $ 140 million 
Ministry of Economy non-reimbursable credit lines (FAD): $75 
million 
Bilateral donations (MFA*Spanish Agency for International 
Development):  $ 55 
Nonspecific technical assistance: $ 10 million (Min. Econ and 
MFA) 
 
6. (C) Comment: Given repeated assurances by our contacts 
that the previous government's commitments at the 
International Donors' Conference for Iraq would be carried 
out, Moratinos' statements in El Pais, if accurate, come as a 
surprise.  It is unclear whether Moratinos was referring to 
MFA assistance funding only or the entire $200 million 
commitment.  His comments may also be part of a pattern of 
sometimes contradictory statements by ministers as the 
Zapatero government tries to create cohesive policies.  We 
will continue to emphasize our expectations that Spain 
fulfill all of its Madrid Conference pledges. 
MANZANARES