Your Excellency, you were Special Ambassador to Iraq. Was that an intense experience?

“In 2003, the then Government of José María Aznar decided to make a contribution to the recons­truction of Iraq. I was sent as the head of the Spanish efforts, a team of about 30 people, and was assigned to coordinate between the UN and the Interim Government of Iraq for six months. I was there at the time of the bomb attack at the UN headquarters in Baghdad. Unfortunately my deputy Manuel Martin Oar was killed. At that moment, I happened to be out to lunch. I was lucky, because my office was completely destroyed. I survived thanks to God.\

What are the biggest misconceptions about Spain that you encounter today?

“Many preconceptions about Spain are simply not present in the world any more. Since 1977, Spain has evolved. Now we’re a major player in Europe. We’ve become a leading democratic country, with special know-how in international relations. We’re economically more present in the world, especially over the past 15 years in Europe and Latin America. Most people in Europe are aware of the evolution in Spain, and have quite a good level  of knowledge about Spain. Yes, bullfighting and flamenco are part of our popular traditions. But I don’t think this image hides the overall perception of Spain as a dynamic and progressive country that’s economically developed.

Spain has quite a large banking sector, yet the Spanish financial services sector is scarcely present in Luxembourg. Why is that?

“Previously, the Spanish Central Bank discouraged Spanish financial institutions from operating here. You could say Luxembourg was ‘blacklisted’ by Spain because of its position on banking secrecy. However, an amendment to our countries’ convention on cooperation on financial reporting was introduced in November 2009. This brings the exchange of banking information between Spain and Luxembourg in line with OECD standards. The amendment was finalised and signed by Luc Frieden and Spanish Economy Minister Elena Salgado Méndez in Brussels, and will come into force soon. Because of this amendment, Luxembourg has been taken off Spain’s ‘black list’. So I expect a higher presence of Spanish financial institutions here, especially in the funds sector where Luxembourg products are quite well considered.

Spain is the first country to deal with the somewhat ambiguous new EU framework and Lisbon Treaty institutions. How is it going so far?

“You are right to raise this concern. The Lisbon Treaty is, in some respects, not very clear about the role of the permanent president of the European Council. Spain’s priority during our EU presidency is to do our utmost to promote the role of the new institutions. We are convinced the EU has to be stronger in order to achieve a more influential role in the world. For that to happen the two new EU figures, the president and high representative, have to be supported.

How are Spanish Prime Minister Jose Luis Rodri­guez Zapatero and the government working with EU President Herman Van Rompuy and High Representative Catherine Ashton?

“The Spanish Prime Minister and President Van Rompuy have a common understanding that the upcoming EU summits in Brussels will be led by Mr. Van Rompuy. Internal EU meetings held at the level of head of government will also be chaired by Mr. Van Rompuy. Internal EU meetings at the level of minister will be chaired by the relevant Spanish minister, with one exception. Meetings of external relations ministers will be chaired by High Representative Ashton. Spain has pledged its complete support to Mr. Van Rompuy and Ms. Ashton.

Mr. Van Rompuy has said he’s positive about the support to be provided to him during the Spanish presidency, especially given Spain’s good record of achievement during its previous EU presidencies.

What work needs to be done in the coming months in order to develop these new institutions?

“We will work quite actively on the foreign policy of the EU. It’s foreseen during our presidency that the pillars of establishing a new EU diplomatic service will be presented, which is a very important provision of the Lisbon Treaty. We will support Catherine Ashton in developing a more coherent, more solid strategy of presenting the EU abroad.Also, this is the first ‘Trio’ presidency, another important provision of the Lisbon Treaty. That means we are working in close coordination with Belgium and Hungary, who will hold the next two European presidencies. For example, we are preparing together the EU summits that will take place during our three terms.

You mentioned the EU-external summits. There are eleven of them during the Spanish presidency. What are some of the key things you hope to accomplish?

“It’s very important to achieve bilateral trade agreements with important partners, for example in Central and Latin America. We will push forward the putting in place of the Union for the Mediterranean’s Secretariat in Barcelona. It’s important to work with the Obama administration to address terrorism and immigration, and to work with Russia on energy security.

Unemployment and slow economic growth are still major problems facing Europe. How can the EU help get the economy back on track this year?

 “On 11th of February, the EU will hold a summit aimed at getting Europe’s severely damaged economies back on track. In March, the European Council will consider a 2010-2020 economic reform and development strategy. We need to see that the eventual withdrawal of public subsidies does not create important ‘disfunctionalities’ among EU partners. We need to take into account the different rhythm of recovery in Europe in order to get back into the European Stability Pact. Not all European countries are in the same position in recovering from the negative consequences of the economic crisis. So, not all of us can decide to withdraw public subsidies right away. We all agree it has to be phased out, but only by taking into account each country’s situation.

During Spain’s presidency, we will promote improvement in education, innovation and research. In education, for example, we want to improve the mobility of teachers and researchers, similar to the Erasmus program for students. We will promote employment and the competitiveness of European companies. Spain is very much concerned about improving job flexibility while protecting job security. The Danish experience is quite useful, and Spain will try to use the Danish model to promote new types of employment contracts. We also will promote job equality and address the question of pension reform, which not only help the social agenda, but both are very much related to the economic recovery and the competitiveness of Europe.

Given massive and growing government budget deficits and government debt across Europe, is the Eurozone under threat?

 “There is real concern about the Eurozone. Some countries have real troubles. These differences have to be addressed. Solidarity within the Eurozone has to be preserved. The Eurozone Group is working to support the decisions of those governments that are adopting radical measures to reduce debt and expenses, but with some flexibility of time. I’m confident this will allow those governments in bigger trouble to get out of the situation eventually.

What is the progress on introducing the new pan-European financial supervision organisations that were agreed last year?

 “The Spanish presidency will go on with the good work done under the Swedish presidency on this matter. That is, introduce two new levels of supervision in Europe. First, at macro-level, three authorities are foreseen to supervise the insurance, banking and stock market industries. Second, a systemic risk board. The European Parliament has begun to address these issues, and then the European Council will have to adopt the new provisions. Spain is working intensely with the EP to push forward their studies, so that draft legislation may come to the Council as soon as possible. If it’s ready for a decision, the Council may approve the rules during Spain’s presidency, but it might take some more time. These reforms are very important to prevent another crisis of a similar nature from taking place in the future.

What are Spain’s other main priorities for its European presidency?

 “We will put forward proposals to promote equality between men and women, and promote legislation to protect women against violence. For example, we would like to see to the creation of legislation that permits national courts to issue protective restraining orders at a European level.

We will be quite active in promoting a European strategy against terrorism. We would like to see a centre that coordinates anti-terrorism activities at a European level, which does not exist today. Counter-terrorism is also another aspect of energy security. Terrorists have already targeted the energy distribution network in some European countries.

We would like to develop and implement a European policy on immigration and asylum, which has already been started under the Swedish presidency, called the Stockholm Programme. Immigration is a common European concern. So we have to have a common strategy to deal with the pressure of people coming from neighbouring countries, and how to help them integrate into European society and the different European countries.

In terms of enlargement of the EU, we intend to move the negotiations with Croatia and Turkey forward, and we intend to facilitate the approval of the candidacy of Iceland during Spain’s presidency and to begin negotiations with the latter.In the Middle East, we will promote negotiations between Israel and the Palestinians. We would like to do something constructive towards the building up of a Palestinian state.

Are you happy with the results of Climate Change Conference last year in Copenhagen?

 “I don’t consider Copenhagen to be a complete failure. At least we have a common understanding and acceptance of the problems. We made some progress with the US and China, who were reluctant towards Kyoto. Now we need to work to achieve a commitment at the next climate summit in Mexico in December of this year.

Is it likely we’ll see an EU Carbon Tax?

 “I don’t think a carbon tax will be an initiative easily approved in an EU framework. When you talk about a carbon tax, or a Tobin tax [on financial transactions to help alleviate global poverty], it is actually very difficult to implement because it might have negative implications on international exchanges. Also, the lesson from Copenhagen is that the EU is not alone. A group of countries, such as the EU, can’t decide on a regime by themselves. Brazil, China, India and South Africa, as well as the United States, very much influenced Copenhagen. We need to take them into account. We can’t think that we can deal with climate change by imposing a solution on other countries. We have to negotiate to find a solution acceptable to everybody.”