US embassy cable - 04AMMAN7841

C O N F I D E N T I A L SECTION 01 OF 02 AMMAN 007841 
 
SIPDIS 
 
USDOC FOR4520/ITA/MAC/ONE/PTHANOS; TREASURY FOR OASIA - 
LARRY MCDONALD 
 
E.O. 12958: DECL: 09/19/2009 
TAGS: PREL, ECON, EFIN, EAID, JO, IZ 
SUBJECT: GOJ SUPPORTS IRAQ RECONSTRUCTION; PRESSES RELATED 
JORDANIAN NEEDS 
 
REF: STATE 196084 
 
Classified By: CHARGE D'AFFAIRES, A.I. DAVID HALE, REASONS: 1.4 (B & D) 
 
Summary 
-------- 
 
1.  (C) At a September 20 meeting in Amman, the Jordanian 
Minister of Planning confirmed that he will head the 
Jordanian delegation to the upcoming Tokyo IRFFI conference. 
He reiterated strong GOJ support for our Iraq reconstruction 
efforts, offered to host the second IRFFI donor conference 
next year in Amman, and welcomed USG efforts in support of 
the upcoming Iraqi elections.  While acknowledging that 
Jordanian assistance to Iraq is largely indirect and/or 
in-kind, he stressed that it is nonetheless comprehensive and 
 crucial to the overall reconstruction effort.  In this 
context he strongly requested high-level USG support for 
approximately $1 billion in assistance to "Iraq-related" 
Jordanian infrastructure and for a Jordanian debt relief 
mechanism tied to a commensurate or larger forgiveness by 
Jordan of the debts owed to it by Iraq.  The Minister related 
that senior GOJ officials up to and including King Abdullah 
are commencing a full-bore effort to obtain Iraq donor 
recognition and support for these Jordanian needs, and 
requested active USG recognition of the legitimacy of these 
issues.  End Summary. 
 
Jordanian Support For Iraq 
-------------------------- 
 
2.  (SBU) A/DCM and econoffs met with the Jordanian Minister 
of Planning, Dr. Bassem Awadallah, to present reftel points 
on the upcoming October 13-14 International Reconstruction 
Trust Fund Facility for Iraq (IRFFI) donor conference in 
Tokyo.  Awadallah reiterated continuing strong GOJ support 
for IRFFI and other Iraq reconstruction assistance and 
confirmed that he personally will lead the Jordanian 
delegation to Tokyo.  He added that the GOJ has offered to 
host the second round of IRFFI donor meetings in Amman in 
March or April, 2005.  Awadallah fully endorsed the USG 
effort to attract new donations in support of the upcoming 
Iraqi elections, and asserted that Jordan is notionally 
prepared to participate in the training of Iraqi election 
officials and to provide other sorts of in-kind assistance 
that would draw on Jordanian experience and the GOJ's 
long-standing constructive relationship with the National 
Democratic Institute (NDI) and similar institutions.  (Note: 
He did not say that the GOJ would provide such assistance 
gratis.  End Note). 
 
3.  (SBU) Although he stressed the importance of Iraqi 
reconstruction to future regional stability, Awadallah 
acknowledged that Jordan, as a major foreign aid recipient 
itself, is unable to make a significant cash contribution to 
this effort.  However, he reviewed the many ways in which 
Jordan is providing in-kind and other indirect assistance to 
the reconstruction effort.  As examples Awadallah and his 
staff identified comprehensive operational support for the 
military hospital in Fallujah (which he said cost $2.5 
million per month); provision of facilities to other foreign 
donors for Iraqi police, military, and other security 
training in Jordan; tax and customs exemptions for food and 
humanitarian assistance transported via Jordan to Iraq; and a 
variety of specialized training programs (such as training 
for civil aviation officials and air traffic controllers) 
provided free of charge by elements of the Jordanian 
government to their Iraqi counterparts. 
 
Iraq Reconstruction: "Don't Leave Out Jordan" 
-------------------------------------------- 
 
4.  (C) More important, Awadallah argued, is Jordan's 
"strategic" contribution of its port, transportation, and 
security infrastructure to open up an economic lifeline for 
Iraq and thereby create the possibility for a long-term 
"special relationship" with Iraq that will draw it away from 
Syrian, Iranian, and other anti-Western economic and 
political influences.  Unfortunately, Awadallah asserted, 
current Jordanian infrastructure cannot sustain this 
objective, or even maintain indefinitely current constrained 
levels of transportation, communications, and border security 
links essential to the continued flow of Iraq reconstruction 
assistance.  He identified approximately $1.0 billion in 
"Iraq-related" Jordanian assistance needs, including $150 
million to upgrade the Aqaba container port (almost wholly 
engaged in Iraq support, he asserted); $705 million to 
upgrade the connecting road system; and $140 million for 
border crossing infrastructure (including a free trade 
facility) and new border posts.  Awadallah claimed to have 
recently briefed IIG Prime Minister Alawi and Planning 
Minister Hafedh on these Jordanian "Iraq assistance" 
infrastructure assistance needs and to have won their full 
support.  He  then provided us with a GOJ position paper 
outlining in more detail the Jordanian request (the same 
paper he gave ASD Rodman recently). 
 
5.  (C) Awadallah raised the issue of Jordanian forgiveness 
of the $1.3 billion owed Jordan by Iraq under the previous 
trade protocol between the two countries.  While Awadallah 
claimed to fully understand and support our efforts to press 
for comprehensive forgiveness of Saddam-era Iraqi debts, he 
argued that Jordan cannot afford to forgive its portion of 
these debts without some offsetting Paris club alleviation of 
its own international debt.  While he suggested that this 
might be subsumed within overall alleviation of the Iraqi 
debt, he stressed that the GOJ is flexible on the modalities 
so long as some debt relief for Jordan is provided in 
parallel to Jordan's forgiveness of its Iraqi debt.  He added 
that he discussed this issue at length with World Bank 
president Wolfensohn in a phone call on September 19, and 
provided us with a GOJ paper on the issue which he said was 
also provided to Wolfensohn (faxed to Desk).  (Comment: EU 
Chiefs of Mission here describe Paris Club relief as a 
"non-starter."  End Comment.) 
 
GOJ:"It's Now or Never" to Get International Support 
--------------------------------------------- ------- 
 
6.  (C) Summing up, Awadallah said the GOJ sees the time as 
"now or never" to get the donor community to recognize and 
step up and address Jordan's Iraq support needs.  He and 
other Jordanian officials will raise this issue at the Tokyo 
plenary and in all related bilateral meetings between now and 
the Tokyo conference, adding that other senior GOJ officials 
including King Abdullah will be going full bore over the next 
few weeks to gain international backing for assistance on 
these projects.  Awadallah noted that this includes his 
forthcoming meetings with Secretary Powell and Dr. Rice, as 
well as King Abdullah's upcoming bialteral meetings with 
French President Chirac (9/28); Italian Prime Minister 
Berlusconi (9/29); British Prime Minister Blair (10/5); and 
German Chancellor Schroeder (10/6).  While acknowledging that 
USG aid is part of its notional assistance solution, 
Awadallah stressed that what the GOJ most wants from the USG 
is active recognition of the legitimacy of the issue and a 
proactive, high-level effort to assist the GOJ in achieving 
what for it are crucial goals. 
. 
HALE