US embassy cable - 04AMMAN784

C O N F I D E N T I A L SECTION 01 OF 02 AMMAN 000784 
 
SIPDIS 
 
TREASUARY FOR DAS ZARATE 
NSC FOR KIFAYAT 
 
E.O. 12958: DECL: 01/30/2009 
TAGS: EFIN, ETTC, IZ, JO 
SUBJECT: ASSETS: JORDANIANS SAY $50 MILLION MORE TO DFI, 
NEED IRAQI TEAM QUICKLY 
 
REF: A. AMMAN 203 
 
     B. 2003 AMMAN 8573 AND PREVIOUS 
 
Classified By: David Hale, CDA.  Reasons 1.5 (b) and (d). 
 
1.  (C)  Summary.  Finance Minister Abu Hammour committed to 
transfer an additional $50 million to the Development Fund 
for Iraq (DFI) in early February and to finalize a list of 
pending and paid claims against frozen Iraqi funds so that an 
Iraqi team that could travel to Amman -- ideally in 
mid-February -- to finalize a review of the claims.  In the 
meantime, Abu Hammour said he had no choice but to pay out an 
additional $15 million in claims to Jordanian banks in early 
February, but only in return for a guarantee that money would 
be returned to the GOJ if information from the Iraqis showed 
it had been erroneously paid.  Abu Hammour also promised that 
$50 million from the joint SOMO-Jordanian refinery account 
would be transferred to the DFI in early February.  Post will 
hold Abu Hammour to all these commitments, but it is 
imperative that the Iraqi side also moves quickly to form the 
team and send it to Amman once the needed information is 
ready.  End Summary. 
 
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Additional $50 million to DFI 
----------------------------- 
 
2.  (C)  Meeting with the Charge and CPA advisor Haydar 
al-Uzri January 29, Finance Minister Muhammad Abu Hammour 
said that he would transfer another $50 million to the 
Development Fund for Iraq account in early February, 
following the Eid holiday (the Jordanian government is closed 
February 1-4).  By early March at the latest, he hoped to be 
in a position, after working with the promised Iraqi 
government team (see below), to make a final payment that he 
now expected to be approximately $150 million. 
 
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List of Claims Nearly Complete 
------------------------------ 
 
3.  (C)  Abu Hammour also provided al-Uzri and the new 
Rafidain regional bank manager for Jordan, Hasan Abu-Thar 
(phonetic), with a list of the pending claims. 
Unfortunately, the list did not identify specific Iraqi 
government counter-parties for the claims, which al-Uzri 
stressed was necessary information to constitute an effective 
Iraqi team.  Abu Hammour agreed that Abu-Thar would work with 
the Ministry staff in the 2-3 days immediately following the 
Eid to add this information to the list.  Based on this 
information, al-Uzri hoped it would be possible to quickly 
assemble an Iraqi team that would come to Jordan to review 
pending and paid claims. 
 
----------------------- 
Some Claims May be Paid 
----------------------- 
 
4.  (C)  Meanwhile, Abu Hammour said that the Jordanian 
technical committee had approved 113 new claims for payment 
out of Iraqi assets frozen in Jordan, with a value of about 
JD11 million ($15.5 million).  He said he had held off from 
paying these since early December despite enormous pressure 
from members of Parliament and businesspeople who "need their 
money back" and are "paying interest of 15-18%."  Having 
stalled for as long as he could, Abu Hammour claimed he had 
no choice but to pay the claims after the Eid holiday. 
However -- Abu Hammour took great pains to stress -- every 
bank that received a payment was required to give the 
Ministry a "financial guarantee with collateral" that the 
money would be returned immediately upon request of the 
Ministry.  "At any time," he said, the "Iraqis could have the 
money back" if they showed that a payment had been 
incorrectly made.  Abu Hammour felt that this gave strong 
protection to Iraqi and Jordanian interests and also 
highlighted the high-standards the Jordanians were applying 
in reviewing claims. 
 
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SOMO Account 
------------ 
 
5.  (C)  On the joint SOMO-Jordanian Refinery company 
account, Abu Hammour also confirmed that he would instruct 
the Jordan National Bank to transfer $50 million of the $77 
million in the account to the DFI immediately after the Eid. 
The remaining $27 million would be used, as agreed with the 
SOMO representative, to settle prior claims against the 
account that were consistent with the purposes for which the 
account was established. 
 
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Comment 
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6.  (C)  We will keep the pressure on Abu Hammour to see that 
the additional information on Iraqi counter-parties is added 
to the list of claims quickly immediately after the Eid, and 
that the Minister follows through with the two $50 million 
transfers to the DFI (bringing the total to $235 million 
including the SOMO account).  But, at the same time, CPA and 
the Iraqis need to act quickly to use the information from 
the list to form a team that can come to Amman and speak 
authoritatively about individual claims.  Abu Hammour 
reminded us that he and PM Fayez had told us they could not 
refrain from paying claims indefinitely (although, al-Uzri 
pointed out, the information needed to form an Iraqi team had 
still not been provided in full.)  The financial guarantees 
provided by the banks seem to protect Iraqi financial 
interests, nevertheless, it is vital that this matter be 
closed quickly so that it not develop into more of a negative 
in the growing Jordanian-Iraqi relationship. 
HALE