US embassy cable - 04DJIBOUTI741

C O N F I D E N T I A L SECTION 01 OF 02 DJIBOUTI 000741 
 
SIPDIS 
 
FOR OBO/REPM/AQD THOMAS GRUBB; ALSO FOR AF/EX AND AF/E 
 
E.O. 12958: DECL: 05/25/2014 
TAGS: AMGT, ABLD, PREL, PGOV, DJ 
SUBJECT: NEW WRINKLE IN QUEST FOR DJIBOUTI NEC SITE 
 
REF: A. STATE 86390 
     B. DJIBOUTI 531 
     C. STATE 69365 
 
Classified By: AMBASSADOR MARGUERITA D. RAGSDALE. 
REASONS 1.4 (B) AND (D). 
 
1. (C) Mohammed M. Ali Yamani, owner of Maya Trading and Real 
Estate Development Company in Jeddah, Saudi Arabia, 
approached Ambassador and Management Officer May 17 regarding 
the USG offer to the Government of Djibouti to purchase a 
parcel of land in the Haramous section of Djibouti ville for 
a new Embassy compound (NEC) (See reftels).  In a meeting at 
the Embassy, Yamani stated that he is the sole owner of the 
parcel in question and that the parcel is part of a villa 
development project he is planning for the area.  Yamani 
refuted our understanding that the Government of Djibouti 
owned the parcel and produced a contract and a Djibouti 
presidential decree which, when translated, appeared to 
corroborate his assertion. Yamani also offered the property 
(40,321 square meters) that is the subject of our interest, 
plus an adjoining 7121 square meters we understood was owned 
by another buyer, all for the amount of "between USD 250 and 
USD 300" per square meter.  (Note: Yamani stated that the 
7121 square meter piece is NOT repeat NOT owned by anyone 
else. His suggested price is significantly higher than the 
amount we offered the Government of Djibouti for the parcel. 
End note.) 
 
2. (U) Ambassador subsequently sought clarification of 
Yamani's assertions in separate meetings with Minister of 
Presidential Affairs Osman Ahmed Moussa, and Minister of 
Cooperation in the Ministry of Foreign Affairs, Mahmoud Ali 
Youssef.  Moussa, who was signatory to the Yamani contract, 
stated that the contract does not convey ownership to Yamani 
and that he would provide further clarification of this in 
the next couple of days.  He did not do so.  Youssef, on the 
other hand, noted that he would be accompanying President 
Ismail Omar Guelleh the following day to Tunis to attend the 
Arab League Summit, would raise the matter enroute, and would 
respond when he returned three days later.  Youssef followed 
through on his pledge and in a brief to Ambassador, declared 
that Yamani does not own the parcel.  He said Yamani has not 
paid for any part of the site he intends to develop and that 
the Government of Djibouti would pass a presidential decree 
the very next day reserving to the USG the 40,321 square 
meters site.  In addition, Youssef stated that President 
Guelleh told him the U.S. should not negotiate anything with 
Yamani. 
 
3. (U) Ambassador responded that this statement of ownership 
alone would not appear to clear the matter.  Yamani has 
stated a claim and he may very well challenge the new decree 
judicially.  Youssef reassured that Yamani had no say in the 
matter, and that if he attempted to challenge the 
presidential decree, he could well lose all of his 
development project.  Ambassador impressed upon Youssef the 
importance of the Government of Djibouti clarifying this 
matter with Yamani, who is based in Jeddah.  We hope it will 
follow through. 
 
4. (C) Ambassador also told Youssef that Yamani wanted to 
sell to the USG a total of 47,442 square meters, which 
includes a section of the parcel that we understood had been 
reserved by another buyer.  She told Youssef that Yamani 
indicated the section is available.  Youssef responded that 
the decree could be amended before it is printed in the 
official gazette on May 26 to reserve the full rectangular 
parcel (47,442 square meters vice 40,321 square meters) for 
the USG.  Ambassador will seek clarification first if 
reservation of the full parcel will obligate the USG to buy 
the full parcel.  If it does not, we will ask the Government 
of Djibouti to reserve the full parcel (per Ragsdale/OBO 
telcon).  (Note: If OBO decides it wishes subsequently to 
take the full rectangular parcel, there would obviously need 
to be a slight adjustment upward in its original USD 1.8 
million offer to purchase. The advantage of the complete 
parcel is that it would give the USG full control of the NEC 
site from all sides.  End note.) 
 
5. (C) OBO may wish to begin thinking now about what it will 
do or should do with the existing embassy site.  Abdurahman 
Boreh, a prominent businessman in Djibouti with close ties to 
President Guelleh, told Ambassador on two separate occasions 
that the Government of Djibouti will want "to possess" the 
existing Embassy site once the U.S. vacates.  He stated that 
the Government of Djibouti will not approve closure of two 
roads -- one at the current site and one at the new site -- 
should the U.S. wish to retain the current site.  While the 
current site does not meet our security requirements and is 
small, it is in a prime location, is developed with several 
sound structures, and will likely have a number of interested 
buyers -- including other Governments and organizations with 
representation here.  Perhaps a land swap with the Government 
of Djibouti might be of interest.  In any case, this issue 
may be possible leverage as we enter into negotiations with 
the owner -- once determined -- of the proposed NEC site. 
6. (U) Embassy will seek clarification from its attorney, 
Alain Martinet, on implications of the decree and related 
issues. 
RAGSDALE