US embassy cable - 05MADRID718

UNCLAS MADRID 000718 
 
SIPDIS 
 
PASS EB/IFD/ODF FOR ROLAND DEMARCELLUS 
 
E.O. 12958: N/A 
TAGS: EAID, EFIN, IZ, SP 
SUBJECT: LATEST ACCOUNTING OF SPAIN'S MADRID DONORS' 
CONFERENCE PLEDGE FOR IRAQ 
 
 
1. Summary. Spain's government continues to appropriate and 
disburse money pledged at the Madrid Donors' Conference.  Of 
the USD 160 million pledged for 2003-2004, USD 142.3 million 
has been appropriated, and USD 122.3 million disbursed.  The 
GOS is working with Iraqi ministries to use the remaining USD 
17 million to buy ambulances.  Spain's Council of Ministers 
approved February 18 Spain's USD 20 million pledge for Iraqi 
elections which is included in Spain's 2003-2004 
appropriation.  The GOS has not begun planning for the 
appropriation of the USD 140 million remaining of its Madrid 
pledge to be disbursed from 2005-2007.  End Summary. 
 
1. Econoff received February 17 the latest accounting for 
Spain's USD 300 million pledge at the Madrid Donors' 
Conference from Subdirector General for the Mediterranean 
Carolina Mayeur of Spain's Agency for International 
Development (AECI).  According to Mayeur, Spain has 
appropriated USD 142.3 million (USD 122.3 million disbursed) 
out of the USD 160 million budgeted for the years 2003-2004. 
 
20 million in non-reimbursable export credits 
18 million in credits for the printing of Iraqi Dinars 
21 million for humanitarian aid in Umm Qasar 
2.6 million in technical reconstruction expertise 
15.9 million for AECI bilateral projects in 2003 
20 million to the International Reconstruction Fund Facility 
for Iraq (IRFFI) 
2.5 million to various UN agencies 
17.3 million for the second tranche of Iraqi Dinars 
5 million for the IFC Small Business Finance Facility (SBFF) 
20 million to the IRFFI for democratic normalization in Iraq 
(not disbursed) 
 
3. According to AECI's Coordinator General of the Office of 
Iraq Reconstruction Miguel Negrillo, the 17 million in funds 
outstanding for 2003-2004 has been budgeted and will probably 
be used for the purchase of ambulances.  The Spanish Ministry 
of Industry and Commerce and the Iraqi Ministries of Health 
and Planning have been discussing what kind and number of 
ambulances will be purchased and when. 
 
4. Spain's USD 20 million contribution for the Iraqi 
electoral process and normalization was pledged in 2004. 
However, it was only approved by Spain's Council of Ministers 
on February 18.  According to Negrillo, the money will soon 
be transferred to the appropriate IRFFI account after 
consultation with the United Nations Development Program 
(UNDP).  The money currently in UNDP accounts will be used 
for other Iraqi development needs identified by the UN. 
 
5. The GOS has not determined what projects or what timeline 
will be pursued in the disbursement of the USD 140 million 
pledged for 2005-2007. 
 
6. Comment. Embassy has followed Spain's Iraq pledge since 
the October 2004 Donors' Conference.  Though the numbers have 
changed since last reported, Spain is clearly making an 
effort to appropriate and disburse the funds promised at the 
Conference.  Although not all of 2003-2004's money was spent 
by the end of 2004, the GOS intends to spend the USD 17 
million outstanding.  It is clear that Spain's government is 
committed to Spain's Madrid pledge.  We can expect Spain to 
work with the UN and the government of Iraq to appropriate 
and disburse the remaining USD 140 million of its USD 300 
million pledge.  As Second Vice President and Minister of 
Economy Pedro Solbes told his Director General for 
International Finance regarding Spain's Iraq pledge, "a 
promise is a promise." 
MANZANARES