Spain and the United States - Real Instituto Elcano

LOOKING AHEAD 125
lifting of the EU sanctions against Cuba, but only 37% viewed the support for
Chávez as positive.
In other Latin American and Caribbean countries – Bolivia, Ecuador and
Haiti – Spain has been helpful in crisis situations. Spain’s Foreign Ministry
coordinated with the US State Department on ways to resolve the political
crises in Bolivia and Ecuador, which saw the departure of both countries’
presidents in 2005. In Haiti, Spain is part of the Brazilian-led UN peacekeeping
force. Spain also has a capacity to act as a kind of broker in crisis situations in
the Middle East, as its image is generally good in Arab countries and also in
some quarters of Israel.
Spain’s two main political parties are now widely in disagreement over
foreign policy, particularly that towards the United States. According to
Elcano’s June 2005 barometer, 86% of respondents believe the Socialists and
the PP are in disagreement over the United States. Foreign policy has become
much more of a domestic political issue. FAES, the PP’s think tank, is very
active in aggressively denouncing the Socialists’ foreign policy.
A victory by the PP in the next general election, to be held by 2008, could
well see a swing back towards a more pro-Atlanticist foreign policy; however,
given the profound opposition to the war in Iraq and the electoral setback for
the PP in 2004 (largely because of its support for the war), a future PP
government would probably not go as far as the last one did in the event of
further military incursions. By moving closer to the United States, the PP was
striving for “major player” status for Spain, but opinion polls suggest that most
Spaniards do not want to move in this direction. This means that however good
an understanding there is between the Spanish and US governments, as long as
it is rejected by the majority of Spaniards, Madrid will always be in a position
of weakness in the face of Washington and will not be fully trusted.
On the economic front, the future of US direct investment in Spain, indeed
of all foreign investment, is closely linked to the long-term direction of the
Spanish economy and to demographics, a factor that tends to be overlooked but
which is very important because of its implications for the supply of labour,
demand and consumption in the domestic market. Foreign direct investment in
Spain as a whole is on a downward trend. Inflows amounted to $35.9 billion in
2002, $25.6 billion in 2003 and $9.9 billion in 2004, according to the OECD.
Excluding the investment in special-purpose entities (SPEs, financial
companies set up to act as a conduit for investment), Spanish inward
investment in 2004 was less than $1 billion, compared with inflows in the
range of $7-9 billion in the years immediately before.
Spain is one of the EU economies that has grown the fastest over the past
decade, in stark contrast to the relative slackness of the area as a whole. Real