US embassy cable - 04SANAA726

C O N F I D E N T I A L SECTION 01 OF 03 SANAA 000726 
 
SIPDIS 
 
E.O. 12958: DECL: 04/24/2014 
TAGS: PREL, ECON, EAID, PARM, PHUM, KMPI, YM, DEMOCRATIC REFORM 
SUBJECT: NEA/ARP DEPUTY DIRECTOR WILLIAMS 3/13-15 VISIT TO 
YEMEN: ECONOMIC DEVELOPMENT, MCA, MEPI, REGIONAL REFORM AND 
DEMOCRACY 
 
REF: A. SANAA 672 
     B. SECSTATE 56282 
     C. SECSTATE 53932 
     D. SECSTATE 50441 
 
Classified By: AGMISENHEIMER, For Reasons 1.5 (b) and (d). 
 
1. (C) Summary: During his 3/13-15 visit to Yemen, Deputy 
Director of NEA/ARP Tom Williams discussed the Greater Middle 
East Initiative (GMEI) and Millennium Challenge Account (MCA) 
with the Deputy Foreign Minister, who critiqued the MCA 
process and indicators.  The DFM also noted his primary 
concern with the GMEI involves linkages with the 
Israel-Palestine conflict, and outlined Yemen's limited 
progress on Arab League reform.  CDA delivered reftel b 
points on Iraq during the meeting.  Williams visited USG 
education and cultural development projects outside Sana'a, 
where progress was illustrated by a U.S. funded school that 
once needed a roof now requesting internet access.  He also 
discussed progress on Yemen's democratic reforms with 
parliamentarians, journalists and civic leaders, and met with 
business community members, who are concerned that economic 
reforms will raise prices and increase taxes (ref a). 
 
2. (C) Williams discussed increasing U.S.-Yemen development 
assistance with Deputy Prime Minister and Minister of 
Planning and International Cooperation (MOPIC), who commented 
positively on increased bilateral cooperation.   CDA signed a 
U.S.-Yemen MOU in the amount of $1.1 million, whereby USG 
agreed to provide technical assistance and equipment to 
support the 2004 national census.  MOPIC officials are also 
interested in increasing public awareness of USG development 
efforts and the ROYG's economic reform package.  End Summary. 
 
US-YEMEN DEVELOPMENT ASSISTANCE: A MODEL OF COOPERATION 
 
3. (C) Williams, along with CDA, USAID Representative, 
Pol/Econoff and PD Officer, met with Deputy Prime Minister 
and Minister of Planning and International Cooperation 
(MOPIC) Ahmed Sofan,  Nabil Shaiban, Director General for 
International Cooperation with Europe and the Americas and 
Technical Advisor Jala Yacoub on 3/15.  DPM Sofan and Shaiban 
both commented positively on the momentum of U.S.-Yemen 
development cooperation, and the need for U.S. support of 
pending ROYG economic reforms.  Sofan's comments on the 
economic reform package debate in Parliament and the need for 
economic, judicial and civil service reforms to improve 
Yemen's chances of qualifying for the Millennium Challenge 
Account (MCA) are reported in detail in reftel a. 
 
4. (U) Remarking that Yemen is "hungry for more" engagement, 
Shaiban said he would like to embark, along with the Embassy, 
on a public awareness campaign to promote U.S. development 
assistance in Yemen.  Shaiban, who freelances as a reporter 
and documentary producer, commented that the public strongly 
associates U.S. assistance with the military and the war on 
terror; he intends to make a short documentary for Yemeni 
television on the subject.  He also mentioned that 90 percent 
of U.S. development aid helps the Poverty Reduction Strategy 
(PRS), and that he wants to do a public presentation on the 
socio-economic impact of the assistance.  When asked how 
projects are prioritized, Shaiban responded that rural roads 
are the priority because they are "the lifelines of 
development" and the key to inter-community economic 
activity, i.e., girls can get to school, people can get to 
hospitals, and goods can get to market. 
 
5. (C) On 3/14, Williams met with members of the business 
community, who are worried that economic reforms will raise 
prices and who did not know the details of the new tax 
proposals (ref a). 
 
THE PRESIDENT'S VISION FOR REGIONAL REFORM: ISRAEL-PALESTINE 
ISSUE MUST BE ADDRESSED 
 
6. (C) Williams discussed U.S. reform concepts with Deputy 
Foreign Minister Noman, who asked for more detailed 
information.  Williams and CDA responded to Noman's queries 
with points from reftels c and d, including the fact that 
during a recent visit to the region U/S Grossman made 
favorable references to the Sanaa Declaration. 
 
7. (C) Noman claimed that the lack of a link between the 
United States' reform ideas and the Arab-Israeli Conflict 
raises an issue of credibility.  He stated that there is a 
misperception and everyone is suspicious of what is coming 
out of DC.  He suggested that the issue of Palestine "holds 
the Arab world hostage," and said people must be convinced of 
U.S. goodwill and, therefore, any reform idea needs to take 
the Palestinian issue into account.  While saying he 
understands that reform should not wait until the problem is 
solved, Noman commented favorably on French and German 
initiatives that address this point. 
 
8. (C) Responding that credibility is not the issue, Williams 
reiterated that the regional reform concept is still being 
formulated, and that reform and efforts to address the 
Palestinian problem can move forward simultaneously.  CDA 
added that the U.S. would like to see a resolution at the 
next Arab League Summit that provides a statement in support 
of reform. 
 
MCA:  YEMEN CRITIQUES INDICATORS AS ECONOMIC REFORMS LOOM ON 
THE HORIZON 
 
9. (C) DFM Noman raised Millennium Challenge Account (MCA), 
remarking that candidates should be encouraged (see also ref 
a), and reported that the Yemeni ambassador in Washington 
told him that he attended a briefing at which he was told ten 
countries have already been chosen and Yemen would not 
qualify.  Pol/econoff noted that there may have been an 
"unofficial tally" of the countries, but no formal decisions 
had been made.   Explaining that this is a new process, both 
Williams and CDA encouraged Yemen to focus on maintaining 
momentum on reforms as the best means of advancing its 
candidacy. 
 
10. (C) Noman questioned the MCA indicators and complained 
that Yemen does not see the reports and analysis that are the 
basis of MCA ranking.  Pol/econoff pointed out that Freedom 
House had been to Yemen, and that Yemen had advanced in the 
democracy rating compiled by Freedom House.  Noman said that 
MCA was a tough hurdle and Yemen needs assistance to meet the 
standards.  He also expressed concern regarding Yemen's 
pending economic reform package and its impact on the 
populace, and said MCA would "ease the pain" of such reforms. 
 Williams noted that FM Al-Qirbi had made similar comments 
about the tough hurdle MCA qualification represented in his 
recent meeting with the Secretary, who had responded that the 
point of the challenge was to provide incentives for 
governments to undertake the necessary tough reforms - which 
is why it is called a challenge. 
 
ARAB LEAGUE REFORM:  YEMEN'S LIMITED SUCCESS 
 
11. (C) Turning to Arab League reform, DFM Noman said the 
most important objective the Yemenis achieved at the recent 
Arab League Ministerial in Egypt was to change the 
decision-making vehicle to a majority vote, rather than 
consensus.  He added that some did not like the Yemeni 
proposal for an Arab League Parliament, and Yemen's Arab 
Security Council proposal "was not liked by others."  He said 
a committee would be formed after the Tunisia Summit that 
would take a year to review all the proposals for overhaul of 
the Arab League.  Noman commented that the Saudi/Egypt/Syria 
proposal was more a statement of principles than a call for 
reform. 
 
12. (C) During the meeting with Noman, CDA delivered relevant 
reftel b points on transition and progress towards a 
democratic and prosperous Iraq.  Noman favorably received the 
information and subsequently requested that the USG provide 
the compendium in Arabic. 
 
DEMOCRACY:  PROGRESS, BUT POLITICAL WILL FOR REFORM NOT 
ALWAYS STRONG 
 
13. (U) At 3/14 lunch, Williams and select members of 
parliament (MPs), journalists, and civil society discussed 
Yemen's democratic experiment, particularly the need for 
parliamentary reform.  Several MP's from both the majority 
political party (GPC) and the main opposition party (Islah) 
noted the lack of knowledge and skills of many MPs who need 
training, and requested assistance for Parliament.  Attendees 
commented that reform needs to continue, but political will 
is not always strong and donor assistance and encouragement 
would help.  Looking at press freedom and case of Saed Thabet 
-- the MPs went to the court in support of Thabet -- one MP 
said that while press freedom in Yemen is better than 
elsewhere in the region, there is still a long way to go. 
 
USG DEVELOPMENT PROMOTES EDUCATION AND PRESERVES CULTURE 
 
14. (U) On 3/15, Williams visited a girls' school in Amran 
built with money from USDA's 416(b) program.  (Note:  The 
school opened in 2003, at a final cost of $244,333.  End 
Note).  Officials told Williams that, since its opening, 
enrollment has risen over 200 percent due largely to the fact 
that it is a single-sex school and more families have allowed 
their daughters to attend.  Students at the school were 
enthusiastic and eager, stating that they want computers and 
internet access to learn about the world.  The same day, 
Williams met with women at the Yemen Adult Life Skills and 
Literacy Education Project in Amran to discuss their 
activities and the women also stated that they would like to 
have computers.  Williams' final development site visit was 
to an infrastructure project in Thula, a nearby village, 
where USG assistance repaved the town's historical main 
entrance. 
 
ASSISTANCE TO THE YEMENI CENSUS 
 
15. (U) CDA, AID Representative, DPM, and the Chairman of the 
Central Statistics Organization, Dr. Amin Muheeddin, signed a 
"Memorandum of Understanding Between The Republic of Yemen, 
Central Statistical Organization, and the United States of 
America, Agency for International Development, for 
Cooperation to Support the 2004 Census of Population and the 
Decentralization of Statistical Information."  Comment:  USG 
is the lead donor for Yemen's national census, which will 
provide data essential for the ROYG to achieve its poverty 
reduction and decentralization goals and to improve 
development planning, economic growth, civil registration, 
elections, good governance, democratization, and investment. 
USG assistance to the ROYG Central Statistical Organization 
will be provided by the U.S. Bureau of the Census with ESF 
funding programmed by USAID/Yemen.   End Comment. 
HULL