INDEPENDENT NEWS

Cablegate: Spain Inclined to Be Flexible On Fsc

Published: Fri 27 Feb 2004 05:29 PM
This record is a partial extract of the original cable. The full text of the original cable is not available.
UNCLAS MADRID 000683
SIPDIS
SENSITIVE
PASS TO USTR FOR SANFORD
E.O. 12958: N/A
TAGS: ETRD ECON SP USTR WTRO
SUBJECT: SPAIN INCLINED TO BE FLEXIBLE ON FSC
REF: SECSTATE 40299
1. (SBU) We shared reftel letter and points with GOS contacts
in Moncloa (the Spanish equivalent of the White House) and
the Ministries of Economy and Foreign Affairs. Nicolas
Lopez, Spain's 133 Committee titular, told us that while
reconsideration of the March 1 retaliation is not possible,
Spain and most other member states are inclined to view U.S.
progress towards a legislative solution favorably. Lopez
said member states feel that the March 1 retaliation will
clearly convey the EU's interest in having the Foreign Sales
Corporation (FSC) law repealed soon. He said he did not
expect that the initial 5% tariff will have strong impact on
U.S. exports given the current euro/dollar exchange rate,
however he warned that given the monthly rate increase, it
would not be wise to delay for long.
2. (SBU) Lopez said that member states have not formally
discussed the three-year transition period. However, on the
margins of 133 Committee meetings, most members have said
"more than three years would not be acceptable." He added
that Spain and most other member states would like to see the
retaliation go away. He said if the U.S. legislation is
reasonable, the EU will be likewise be reasonable in its
response.
MANZANARES
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