US embassy cable - 05BAGHDAD2991

S E C R E T SECTION 01 OF 04 BAGHDAD 002991 
 
SIPDIS 
 
NOFORN 
 
E.O. 12958: DECL: 1.6X6 
TAGS: PREL, PGOV, EFIN, MOPS, KISL, SY, JO, IZ, IR, Parliament 
SUBJECT: DEPUTY SECRETARY ZOELLICK'S MEETING WITH IRAQI 
PRIME MINISTE JAFARI 
 
REF: BAGHDAD 2933 
 
Classified By: Charge d' Affaires David M. Satterfield for reasons 1.4 
(b) and (d) 
 
1.  (S/NF)  Summary: Prime Minister Jafari reiterated to the 
Deputy Secretary that security conditions on the ground, and 
not terrorist demands, should determine the manner of 
withdrawal of Coalition forces.  The Deputy Secretary agreed 
and noted approvingly the Prime Minister's naming of an Iraqi 
official with whom the U.S. could begin elaborating these 
conditions.  He also urged the Prime Minister to help enable 
an independent Iraqi judiciary to take over and review the 
cases of detainees now under Coalition control.  Jafari 
sought American help with neighboring Sunni Arab states that 
support terrorism in Iraq.  He said he was getting messages 
from Syria that the Syrians would change their policy on Iraq 
and they wanted the Prime Minister to visit.  However, Jafari 
would not visit Damascus until he sees concrete measures from 
the Syrians in terms of halting media incitement against 
Iraq, controlling the borders and cracking down on former 
Iraqi regime elements in Syria.  Jafari also sought help in 
arranging visits to Egypt and Saudi Arabia. 
 
 
2.  (S/NF) Summary Continued. The Deputy Secretary cautioned 
that the Syrians excel at offering minimal concessions, and 
he urged the Prime Minister to hold out for the best deal 
possible.  He also cautioned the Prime Minister to ensure 
that agreements signed with the Iranians be clearly in the 
favor of Iraq to ensure the Iraqi Government's own 
credibility.  On the constitution, Jafari opined that the 
Iraqis would come to a deal, including most of the Sunni 
Arabs on the committee.  The Deputy Secretary noted the 
importance of sticking to the timeline in the transition law, 
as the issues would not get easier with a delay.  On the 
economy, Jafari said he anticipated the Iraqi government 
budget deficit would grow.  The Deputy Secretary cautioned 
against fiscal slippage as the year goes forward and said the 
IMF and World Bank were ready to help Iraq if Baghdad could 
develop a good plan on the use of oil revenues.  End Summary. 
 
3.(SBU) Participants 
U.S. 
Deputy Secretary Robert Zoellick 
Charge d'Affaires David Satterfield 
NSC Senior Director Meghan O'Sullivan 
D Executive Assistant Ambassador Ross Wilson 
S/I Deputy Director Robert Deutsch 
Adam Ereli, PA 
Political Counselor Robert Ford (notetaker) 
 
Iraq: 
Prime Minister Jafari 
Prime Minister Chief of Staff Mohammed Tamimi 
Prime Minister advisor Felah Feyadh 
Prime Minister advisor Beshar Nahar 
Prime Minister spokesman Laith Kubba 
 
 
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COALITION FORCES STAY UNTIL IRAQIS READY 
---------------------------------------- 
 
4.  (C/NF) Jafari said Iraqi forces are growing stronger on 
the ground.  He sensed that the terrorists are changing from 
car bomb attacks to attacks on infrastructure and now attacks 
on foreign ambassadors.  More importantly, he said, help to 
Iraq on security issues now benefits not only Iraq.  Rather, 
Iraq is on the front line of the larger war on terror; those 
who struck London were the same as those responsible for the 
murder of the Egyptian Ambassador in Baghdad and other 
terrorism in Iraq.  Jafari mentioned in passing that he was 
facing questions from the National Assembly about his 
relations with the Coalition Forces and also the intelligence 
services.  He said he would want to discuss these issues when 
Ambassador Khalilzad returns to Baghdad.  (Comment:  Later on 
July 12, Jafari addressed the National Assembly about his 
decision to ask the U.N. at the end of May to maintain the 
Coalition forces in Iraq.  End Comment.) 
 
5.  (C/NF) Jafari said while there were some in Iraq calling 
for Coalition Forces to withdraw, the timing should in fact 
be dictated by security conditions.  He underlined the 
importance of coordination between the U.S. and the Iraqi 
Government on the issue of withdrawal.  He also noted that 
the Prime Minister is the ultimate source of decision-making 
on security issues. 
 
6.  (C/NF) The Deputy Secretary assured the Prime Minister 
that the U.S. would not withdraw before the mission is 
completed, as the President had said.  Decisions on the 
future of Coalition Forces would depend on circumstances on 
the ground.  The U.S. would work with the Iraqi national 
security team to establish those conditions.  The Deputy 
Secretary thanked the Prime Minister for appointing a lead 
 
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Iraqi official for us to work with on that task.  The Deputy 
Secretary also urged the Prime Minister to reach out to other 
 
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Coalition countries and underline the value of their 
contributions.  The Deputy Secretary also urged the Prime 
Minister to foster standing up the Iraqi forces by promoting 
officers on the basis of performance while also ensuring that 
Iraqi security forces remain under ultimate civilian control. 
 
7.  (C/NF) The Deputy Secretary recalled how the judicial 
system under the Saddam regime had been cruel and unjust.  He 
encouraged the Prime Minister to work to build an 
independent, fair judicial system.  He reminded the Prime 
Minister that this would also require building facilities. 
The Iraqi Government would gain in credibility if the Iraqi 
judiciary starts to review the cases of detainees now under 
Coalition control. 
 
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SYRIA: JAFARI AWAITS CONCRETE STEPS 
------------------------------------ 
 
8.  (C/NF) The Prime Minister said there were fewer 
infiltrations of Saudi nationals over the Syrian borders, but 
the infiltrations were still a problem.  He said he wanted to 
see the Syrian Government take practical steps to control the 
borders, crack down on former regime elements operating in 
Syria and return Iraqi assets.  Jafari referred to meetings 
in June with Syrian Foreign Minister Shara in Brussels and 
the Syrian Ambassador in London and said the Syrians are 
saying they will meet Iraqi demands.  Jafari said the Syrians 
want him to go to Damascus, and there are "serious efforts" 
underway to see if such a visit can happen.  The Deputy 
Secretary cautioned the Prime Minister that the Syrians excel 
 
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at making minimum concessions.  The Syrian Government can 
control infiltration across the borders if it chooses.  He 
urged the Prime Minister to maintain pressure and secure the 
maximum possible from the Syrians before any visit 
 
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USE CARE WITH IRAN 
------------------ 
 
9.  (C/NF) The Deputy Secretary commented as well that the 
U.S. understands that Iraq needs good relations with Iran. 
The U.S. by contrast has a difficult relationship with Iran. 
He urged the Prime Minister to move forward with care, 
ensuring that he can justify agreements as positively 
benefiting Iraq each time.  This is important to sustain 
Iraq's credibility, he observed.  The Deputy Secretary 
contrasted a potential deal enabling Iraq to buy badly needed 
electricity from Iran with an oil deal in southern Iraq whose 
benefits for Iraq were less obvious. 
 
10. (S/NF) In a session following the larger meeting, 
attended only by the Deputy Secretary and Charge, the PM said 
that the Iranians had offered to arrange a meeting in Teheran 
with Syrian President Bashar al-Asad.  Jafari said that he 
believed such a meeting would be useful as a means of 
beginning to improve Syrian-Iraqi relations, and would be 
better done outside Syria than in Damascus.  Bashar, Jafari 
asserted, was different from the rest of the Syrian regime; 
but he is surrounded by bad elements like VP Khaddam and 
(former) Baath Party head al-Ahmar.   Having approached 
Charge on the same issue the previous day through aide Laith 
Kubba and aware of strong USG reservations, Jafari was at 
pains to tell the Deputy Secretary that he would not want to 
do anything that would upset or anger the U.S. 
 
11. (S/NF) The Deputy Secretary told Jafari that we 
understood Iraqi interest in improved relations with all its 
neighbors, including Iran and Syria.  But especially in the 
case of Syria, it was important for Iraq to demand and 
receive concrete steps from Damascus - on action against 
insurgent elements and on Iraqi assets - before taking steps 
that would then be used by Syria to ease the pressure which 
the Deputy Secretary told Jafari the U.S. was continuing to 
apply.  A meeting with Bashar al-Asad in Iran would be viewed 
very negatively by the U.S., he made clear. 
12.  (S/NF) Jafari said he understood our message clearly. 
On Iran, he noted Defense Minister Dulaimi's recent visit 
(ref) and said that only limited, "very practical" steps on 
the security side were under discussion.  The PM's own trip 
to Teheran, planned for July 16, would focus on 
commercial/economic issues.  The Deputy Secretary said that 
we understood that there may be value in obtaining 
electricity from Iran, but we had concerns about the true 
economic value of some proposals being discussed regarding 
(possible barter) oil trade. 
 
-------------- 
AND FROM JORDAN 
--------------- 
 
13.  (C/NF) The Prime Minister said he thought the Jordanian 
position on Iraq was improving.  He contrasted King 
Abdallah's press remarks earlier this year about a Shia 
threat to the region with his remarks at a recent conference 
in Amman about Islam in which the King condemned terrorism 
and sectarianism.  The Prime Minister hoped to see concrete 
steps from Jordan with respect to Iraqi assets and former 
regime elements there too.  The Deputy Secretary suggested 
that King Abdallah wants to be helpful.  Highlighting the 
King's remarks at the Amman conference on Islam, the Deputy 
Secretary urged Jafari to work with Abdallah and the Prime 
 
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Minister of Malaysia, and others, to set a positive example 
of positive leadership among Muslim states. 
 
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HELP US WITH SUNNI ARAB STATES 
------------------------------ 
 
14.  (C/NF) Jafari asserted that the neighboring Sunni Arab 
states are basically hostile to the Shia-dominated government 
in Baghdad.  It would have been better to have a Sunni Arab 
as president in Iraq to ease Sunni sensitivities, but history 
went another direction.  Now Iraq needs American help to 
prevent interference from Sunni Arab states.  Pointing to 
Saudi Arabia and the Gulf states, he said "Sunni" money goes 
to terrorists; "Sunni" media supports terrorist acts and 
Sunni clerics lend credibility to terrorists. 
 
 
 
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CONSTITUTION:  A DEAL IS POSSIBLE 
--------------------------------- 
 
15.  (C/NF) The Prime Minister thought the inclusion of more 
Sunni Arabs in the constitution committee would help reduce 
Sunni Arab support for terrorism as well.  Jafari agreed with 
the Deputy Secretary that the document should not be too long 
and complicated.  Jafari said he thought a deal with the 
majority of the Sunni Arabs on the committee is possible, but 
they were putting tough issues on the table: 
 
-- their insistence on the Arab identity of the Iraqi state 
would irk the Kurds.  Jafari said he personally agreed with 
the Sunni Arabs.  Iraq's Foreign Minister is a Kurd and he 
sits in the Arab League meetings, Jafari observed.  It would 
be difficult to say the Foreign Minister was not representing 
an Arab state when he does so. 
 
-- their objection to federalism as potentially leading to 
the separation of Iraq was misplaced, Jafari opined.  The 
Prime Minister said he thought the constitution should 
establish the principle of federalism but not provide too 
much operational detail.  Jafari added that Iraq's current 
federalism is bad.  The Kurds are able to oppress minorities 
in the Kurdish region with impunity. 
 
-- their raising the role of Islam and the state was scaring 
minorities.  Jafari said it would be important to secure 
minority rights in the constitution as it was done in the 
Transition Administrative Law (TAL). 
 
--  their objection to government officials having dual 
nationality was not serious, Jafari opined. 
 
--  their raising the status of the Baath party was more 
serious.  Jafari said some Baathists were trying to secure 
the party's goals by lobbying members of the constitution 
committee.  The TAL was clear:  the Baath party is gone. 
Jafari said each individual Baath party member can be dealt 
with on the basis of his own history.  Jafari opined most 
Iraqis would agree with this. 
 
16.  (C/NF) The Deputy Secretary congratulated the Prime 
Minister for convincing Sunni Arabs to join the constitution 
committee.  He said the U.S. would urge them, and others, to 
stay on the timeline laid out in the TAL; issues would not 
get easier with a delay.  He also asked the Prime Minister to 
keep an eye on the election process itself.  For example, if 
the committee decides to change the system of electing 
members to the National Assembly, it needs to make the 
decision in time for the right preparations to be made.  The 
Deputy Secretary added that the independent election 
commission's credibility had been an important ingredient to 
the success of January 2005 elections, and he urged the Prime 
Minister to facilitate their work while respecting their 
independence. 
 
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ECONOMY:  FOCUS ON BUDGET 
------------------------- 
 
17.  (C/NF) Prime Minister Jafari told the Deputy Secretary 
that Iraq faced a difficult budget situation.  In 2004, the 
government received USD 20 billion in revenues while its 
expenditures were USD 24 billion.  In 2005, its revenues 
again would total around USD 20 billion, but expenditures 
would grow to USD 25 billion.  The budget deficit therefore 
would grow from USD 4 to USD 5 billion.  Meanwhile, delivery 
of essential services was not improving.  Jafari said that he 
was anxious to increase private investment, and he had asked 
for American help. 
 
18.  (C/NF) The Deputy Secretary welcomed the Prime 
Minister's focus on the budget, and praised the abilities of 
the Iraqi Finance and Planning ministers.  He urged Jafari to 
empower them.  The Deputy Secretary highlighted the chance 
for the July 18-19 international conference in Jordan to 
mobilize support for Iraq.  In September the IMF-World Bank 
meetings in Washington would be another opportunity to 
highlight Iraqi needs.  The Deputy Secretary mentioned that 
he had recently met senior officials of the IMF and World 
Bank and found that they understood Iraq's special 
circumstances.  What the organizations need to see is a 
coherent policy and plans for step by step reform, including 
steps to bring the fiscal picture into balance.  The Deputy 
Secretary concluded that it would be important for the Iraqi 
 
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Government to stick to its debt reduction agreement and avoid 
fiscal slippage. 
 
 
19. (U) REO HILLAH, REO BASRAH, REO MOSUL, and REO KIRKUK, 
minimize considered. 
Satterfield