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Viewing cable 05MADRID2131, SPAIN/CUBA: TITLE III OF THE LIBERTAD ACT

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Reference ID Created Released Classification Origin
05MADRID2131 2005-06-06 14:04 2010-12-17 21:30 CONFIDENTIAL Embassy Madrid
This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L SECTION 01 OF 02 MADRID 002131

SIPDIS

DEPARTMENT FOR EUR/WE AND WHA/CCA

E.O. 12958: DECL: 06/06/2015
TAGS: ETRD ETTC PREL CU SP
SUBJECT: SPAIN/CUBA: TITLE III OF THE LIBERTAD ACT

REF: A. A) SECSTATE 96300
B. B) MADRID 2114
C. C) 2004 MADRID 4554

Classified By: Political Counselor Kathy Fitzpatrick; reasons 1.4 (B) a
nd (D)

1. (U) Spain is among the most important foreign investors in
Cuba and the ruling Socialist party has continued the Popular
Party's policy of encouraging further investment and trade
with Cuba. On human rights issues, the GOS has broken with
the Aznar administration's emphasis on support for democracy
activists in favor of seeking greater dialogue with the
Castro regime. Within the EU, Spain successfully advocated
the suspension of the EU's policy of inviting dissidents to
EU national day events, calling the invitations a major
impediment to normal contact with the Cuban authorities.

2. (C) The EU decision to suspend the Restrictive Measures
will be reviewed this month in Brussels and the GOS will
likely try to claim that the suspension has had a positive
effect in Cuba and should be maintained (Ref B). Spanish
officials claim that their policy of engagement won the GOC's
release of 14 political prisoners in 2004, as well as the
GOC's decision to allow former political prisoner Raul Rivero
to exit Cuba (and take up residence in Spain) and to permit
the May 20 opposition gathering in Havana to take place. The
GOS also takes credit for two meetings in Havana in the first
six months of 2005 between EU chiefs of mission and Cuban
opposition figures. MFA officials insist that these
meetings, part of what they describe as a "structured
dialogue" between the EU and Cuban democracy activists, are
important symbols of EU support for human rights and
democratic reforms in Cuba.

3. (C) Post continues to engage GOS interlocutors to convey
the USG's strong concern that increased EU engagement with
the regime has strengthened, not weakened, Castro's hold on
political power at the expense of the opposition. However,
it is not likely that the Zapatero government will veer from
its current Cuba policy in the near to medium term. Madrid
has a substantial political and economic stake in Cuba and
appears resigned to Castro's continued leadership.
Therefore, Zapatero will continue to favor a strategy that
limits the possibility of EU conflict with Castro and will
subordinate human rights concerns to its broader interests.
The GOS will also seek to maintain its role as the key EU
interlocutor with Havana. Cuban Foreign Minister Felipe
Perez Roque visited Madrid in March to meet with high level
GOS officials, including President Zapatero and Fidel Castro
has been invited to participate in the Ibero American Summit
in Salamanca, Spain in October. While some in Spain,
including the Popular Party, oppose this increased level of
engagement, all political forces would oppose the
implementation of Title III of the Libertad Act with regard
to Spanish companies.

4. (U) Spanish businesses are well aware of the potential of
U.S. legal action against them under the Libertad Act and
take care to obscure precise invormation regarding their
investments in Cuba. However, we have obtained the following
general information regarding the major Spanish investors in
Cuba:

-- Grupo Sol Melia: Hotel/Tourism industry. Locations in
Cuba include Havana, Varadero, Cayo Largo, Cayo Santa Maria,
Ciego de Avila, Cayo Largo del Sur, Cayo Guillermo, Playa
Esmeralda, and Santiago de Cuba. The total investment amount
is unknown, but press reports indicate Sol Melia will invest
USD 50 million in two hotels in 2004-2005.

-- Inversiones Ibersuizas: Commercial investment firm.
Investments in Cienfuegos and Santiago de Cuba. According to
press reports, Inversiones Ibersuizas has invested a total of
USD 150 million in various Cuban projects.

-- Occidental Hotels and Resorts: Hotel/Tourism. Investments
in Havana and Play Yuraguanal. Investment amount unknown.

-- Grupo Pinero: Hotel/Tourism. Investment in Varadero.
Investment of at least USD 2 million, according to press
reports.

-- Iberostar: Hotel/Tourism. Investments in Varadero, Cayo
Coco, and Trinidad. Investment amount unknown.

-- Barcelo: Hotel/Tourism. Investments in Varadero and Cayo
Largo del Sur. Investment amount unknown.

-- NH Hoteles: Hotel/Tourism. Investment in Havana.
Investment amount unknown.

-- Grupo Riu: Hotel/Tourism. Investment in Varadero.
Investment amount unknown.

-- Hotetur: Hotel/Tourism. Investment in Varadero and
Havana. Investment amount unknown.

-- Aguas de Barcelona: Utility. Investment in Havana in
joint venture with Aguas de La Habana. Investment of at
least EUROS 5 million in 2002. Subsequent investment amounts
unknown.

-- Grupo Altadis: Tobacco. Unspecified location. Investment
amount unknown

-- Grupo Freixenet: Wine/Alcoholic Beverages. Unspecified
location. According to press reports, Freixenet has invested
USD 200,000 to help the Cuban wine industry.
-- Repsol YPF: Energy. Investment in Cuban territorial
waters. According to press reports, total Repsol investment
is USD 25-40 million.

-- Iberia Airlines: Transportation industry. Investment in
Varadero. Investment amount unknown.



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