US embassy cable - 05BAGHDAD2445

C O N F I D E N T I A L SECTION 01 OF 03 BAGHDAD 002445 
 
SIPDIS 
 
E.O. 12958: DECL: 06/07/2015 
TAGS: PGOV, PREL, ECON, EAID, PINS, KDEM, IZ, Reconstruction, Parliament, National Assembly 
SUBJECT: CHARGE DISCUSSES IRAQI POLITICS, COORDINATION WITH 
AID DONORS, AND PREPARATIONS FOR INTERNATIONAL CONFERENCES 
WITH PLANNING MINISTER SALEH 
 
 
Classified By: Deputy Chief of Mission David M. Satterfield for 
reasons 1.4 (b) and (d) 
 
1. (C) SUMMARY: Minister of Planning and Development 
Cooperation Barham Saleh on June 7 told the Charge that the 
initial steps taken by the Iraqi Transitional Government 
(ITG) and Prime Minister Jaafari were weak and lackluster. 
On the constitution, Shi'a political groups are pushing to 
complete a first draft by July 15, subject to further 
revision before the August 15 deadline for approval by the 
Transitional National Assembly (TNA): religion, federalism, 
and regime type are the most important constitutional issues. 
 The Minister advised the USG to remain consistently engaged 
in Iraq and to avoid ceding influence to Iran.  Saleh remains 
unhappy with Jaafari's decision to make Finance Minister 
Allawi the focal point for coordinating donor aid, telling us 
there has been no formal reassignment of the portfolio in 
writing.  The Minister has completed a draft of the National 
Development Strategy that will highlight economic reform, the 
need for private sector development, and other pro-market 
initiatives.  Saleh has received a letter from the Jordanian 
Minister of Planning saying that Amman would prefer to 
postpone the IRFFI donors' conference until August or 
September.  END SUMMARY. 
 
2. (SBU) Charge Satterfield and emboffs met on June 7 with 
Barham Saleh, Minister of Planning and Development 
Cooperation. 
 
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ITG MUST AVOID WEAKNESS, OVER-REACHING 
-------------------------------------- 
 
3. (C) Assessing the general situation in Iraq, Saleh said 
the country's problems can be solved, but only if the ITG 
adopts a line of march based on a realistic understanding of 
the country's history and complexity.  In particular, the new 
majority comprising the victims of Saddam's regime--Shi'a and 
Kurds--must avoid the temptation to over-reach. The ITG's 
initial steps in this regard have been lackluster, and Prime 
Minister Jaafari's leadership has been weak, according to 
Saleh.  Jaafari has been acting as a factional rather than 
national leader and does not understand the complexity of 
Iraq, especially the need to mollify the Sunni minority. 
Moreover, Saleh added, Jaafari and his party have not honored 
their commitments, such as the scope of the Planning 
portfolio (see paragraph 8 below) and other promises to the 
Kurds.  (COMMENT: Saleh's comments track with the accounts of 
Rowsch Shaways and President Talabani regarding a July 8 
"confrontation" with PM Jafari over his presumed failings 
(SEPTEL).  END COMMENT) 
 
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CONSTITUTION APPARENTLY ON THE FAST TRACK 
----------------------------------------- 
 
4. (C) Saleh told us that the Shi'a were pushing to complete 
a first draft of the constitution by July 15, subject to 
further revision before the August 15 deadline for approval 
by the TNA.  (NOTE: Constitution Committee Chairman Hammoudi 
said in a separate meeting with poloff that this was his goal 
as well.  END NOTE)  A "kitchen group" including Saleh, 
Deputy President Mahdi, and Deputy Prime Minister Shaways was 
working behind the scenes to expedite the process.  He 
highlighted three issues as most important: 
 
-- The role of religion in the state. 
 
-- Definition of federalism: Saleh said he would like to see 
political authority and revenues devolved as much as possible 
to the regions. 
 
-- Type of regime: Saleh admitted that a presidential regime 
would be more "natural" for most Iraqis and appeared the 
preference of the Shi'a.  The Kurds, however, will press for 
a parliamentary regime. 
 
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NEED TO CONTROL INSURGENCY 
-------------------------- 
 
5. (C) Saleh said he sees dangerous signs that Sunni 
religious agitation is being politicized, raising the 
possibility that the insurgency will metastasize into a 
broader Sunni insurrection.  To forestall this, in his 
opinion, the new Shi'a majority must reach out to moderate 
Sunni leaders such as TNA Speaker al-Hashimi, who need to be 
made to appear strong and credible in their constituents' 
eyes.  The Minister concurred with the Charge's assessment of 
the importance for the ITG of harmonizing its message on the 
insurgency both internally and in communicating with the 
Iraqi public. 
 
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ADVICE: STAY ENGAGED 
-------------------- 
 
6. (C) Turning to how the USG should proceed in Iraq, Saleh 
said we must first build on what has worked.  The strict 
timetable imposed on the lifespan of the Iraqi Interim 
Government and on the constitution-writing process shares 
much of the responsibility for the successful elements of 
recent political developments.  The U.S. also has done an 
effective job of Sunni outreach, which most Iraqis view as 
serious and credible.  Moreover, Saleh continued, we ought 
not ignore regions such as the Kurdish north that have 
remained relative secure and stable.  The Minister noted in 
this regard that he was traveling to Sulaimaniyah and Erbil 
on June 9 for meetings with Regional President Barzani and 
other regional figures. 
 
7. (C) The U.S. can do a better job of staying consistently 
engaged in Iraq and maintaining a mid-point between 
intervention and indifference, Saleh told us.  We should not 
under-estimate the importance of our role and influence here. 
 In the Minister's assessment, the U.S. is one of three 
critical factors in the country; the other two--Ayatollah 
Sistani and Iran--are also foreign. 
 
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COORDINATING DONOR COORDINATION 
------------------------------- 
 
8. (C) Saleh told us he was surprised when he learned that 
the ITG's focal point for coordinating donor aid was to be 
Finance Minister Allawi.  The Planning Minister believes this 
was done largely for partisan reasons, so a member of 
Jaafari's party could be seen as responsible for large flows 
of donor aid.  (NOTE: Information from local Canadian aid 
representative Heather Cruden tends to substantiate Saleh's 
suspicions.  Jaafari's chief of staff Laith Koubba told her 
late last month that the donor aid focal point was the person 
of the Minister of Finance and not the institution of the 
Ministry of Finance.  END NOTE)  Saleh commented that, beyond 
the dent this put in his own standing, the move had been done 
in a way that created unnecessary confusion.  First, there is 
simply no time to establish a donor coordination unit in 
Finance in time for the Brussels and IRFFI conferences. 
Moreover, there has been no formal reassignment of the 
portfolio; Saleh has seen nothing in writing about this from 
the Prime Minister's office.  Saleh and Finance Minister 
Allawi had been convened by Deputy Prime Minister Chalabi to 
try to resolve the issue on June 6, but it appears little 
headway was made.  Summing up, the Minister said, "The way 
things are going is a bad omen." 
 
9. (C) Charge noted that the Prime Minister's appointment of 
the Finance Minister as focal point for donor coordination 
might not be optimal, but it would be counter-productive to 
second-guess this decision now.  At this Saleh stepped down a 
bit, saying he recognized the need to stay engaged with all 
his ITG counterparts and put Iraq's best foot forward at 
Brussels and the other meetings. 
 
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ECONOMIC VISION 
--------------- 
 
10. (C) Saleh told us he remained a "non-planner" despite his 
new portfolio and promised he would not "go native" during 
his tenure at the Planning Ministry.  He wants to highlight 
the Ministry's role in attracting and nurturing private 
sector investment, and for it to serve as a resource center 
for all types of investment. 
 
11. (C) Saleh said a committee in the Ministry, led by Senior 
Deputy Minister Faik Abdol Rasool, has completed an economic 
strategy document for presentation at the Brussels and the 
IRFFI conferences.  This strategy focuses on economic reform 
and the need for private sector development.  (NOTE: We will 
obtain a copy from the Ministry and share with Washington. 
END NOTE) 
 
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POSSIBLE DELAY IN IRFFI CONFERENCE 
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12. (C) Saleh mentioned in passing a letter he had just 
received from the Jordanian Planning Minister, stating that 
the Jordanian hosts would prefer that the IRFFI conference 
take place in August or September, and not in July.  Saleh 
appeared nonplussed by this news.  (NOTE: The Minister's 
chief of staff has promised to send us a copy of this letter, 
which we will share.  At a separate meeting of donor 
representatives on June 7, EC Iraq Mission chief Ana 
Gallo-Alvarez said her Amman office had heard that the 
Jordanians would prefer a September date for the IRFFI 
conference.  Representatives from Canada--chair of the donors 
committee--and the World Bank said they had not been 
informed.  END NOTE) 
 
13. (U) REO Hillah, Basrah, Kirkuk, and Mosul Minimize 
considered. 
Jeffrey