US embassy cable - 05BAGHDAD3036

C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 003036 
 
SIPDIS 
 
NOFORN 
 
E.O. 12958: DECL: 07/20/2015 
TAGS: PREL, PGOV, PTER, IZ, Parliament 
SUBJECT: CHARGE DISCUSSES CONSTITUTIONAL ISSUES WITH TNA 
DEPUTY PRESIDENT SHAHRISTANI 
 
 
Classified By: Charge d' Affaires David M. Satterfield for reasons 1.4 
(b) and (d) 
 
1.  (C/NF) Summary. TNA Deputy President Hussain 
al-Shahristani and Charge discussed the state of play of the 
constitutional debate along with the TNA's progress on key 
legislative proposals in a July 18 meeting.  Shahristani told 
Charge that eighty percent of the drafting has been completed 
and that federalism is the only remaining big issue to be 
decided.  Shahristani thinks the goal of having an approved 
text by August 15 is achievable.  While all parties have 
agreed to some basic features of federalism, Sunni committee 
members are concerned that a small southern region styled 
after the Kurdish Regional Government will subject Iraq to 
undue Iranian influences and ultimately result in the 
dissolution of Iraq.  Shahristani said natural revenues 
should be shared on a per capita basis, but  the ownership 
issue is problematic as the Kurds are insisting on regional 
ownership.  Charge repeated the USG position that ownership 
of natural resources should remain with the central 
government. 
 
2.  (C/NF) Summary Continued.  Shahristani spoke highly of 
the TNA's progress to date.  He said the new referendum law 
will soon be passed, along with a law addressing shortcomings 
in the Iraqi Special Tribunal statute and a new electoral law 
for the December elections. End summary. 
 
------------------------------- 
Constitution Debate Progressing 
------------------------------- 
 
3.  (C/NF) In a July 18 meeting with Charge, TNA Deputy 
President Shahristani said the constitutional negotiations 
have been intense, but the parties have achieved consensus on 
eighty per cent of the major issues and are progressing 
toward consensus on the key issue of federalism.  Agreement 
on this issue will take time said Shahristani, but he is 
optimistic that one will be achieved by the August 15 
deadline. 
 
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Federalism - Sunni Concerns 
--------------------------- 
 
4.  (C/NF) Shahristani indicated that all parties have agreed 
to Kurdistan's status as a federal entity and to the central 
government's exclusive powers over foreign affairs, national 
defense, currency, and other central responsibilities.  All 
other powers will be reserved for the provinces, said 
Shahristani.  The Sunnis are insisting that all but Kurdistan 
stay unified or, if there must be change, that only one 
region be created from the nine southern governorates. 
 
5.  (C/NF) Sunni fear of having many regions within Iraq 
stems from their concern that a small southern region would 
be subject to undue influence from Iran, said Shahristani. 
"We think they need time to live as equal citizens in a 
democratic society," Shahristani said, "before the Sunni 
Arabs will be comfortable with the idea of federalism.  They 
must understand that constitutional guarantees lead to 
rights, not the denial of rights to others," offered 
Shahristani. 
 
6.  (C/NF) Addressing the issue of a southern region, 
Shahristani confirmed that some deputies in the TNA want to 
form a region now.  He went on that "Najaf (referring to 
Ayatollah Sistani) does not wish to see unnecessary friction 
created and has asked that we refrain from moving forward on 
such a proposal at this juncture."  That said, the Assembly 
may consider the idea of creating a region from the nine 
southern governorates after the elections, but only if the 
Sunnis do not object, stated Shahristani.  The Charge offered 
that this thinking is consistent with USG policy: the TNA 
should ensure that the right to form regions is embodied 
within the new constitution. However, the TNA should not take 
action now to create a region, as it would unnecessarily 
disturb current negotiations. 
 
--------------------------------------------- ----- 
Fiscal Federalism - Revenue and Resource Ownership 
--------------------------------------------- ----- 
 
7.  (C/NF) Although all parties have agreed to share revenues 
derived from natural resources on a per capita basis, 
Shahristani confirmed that they have not reached agreement on 
the issue of the ownership of natural resources.  The Shia 
and Sunni Arabs favor national ownership of Iraq's resources 
while the Kurds desire ownership by region.  This debate is 
crucial to the Sunni Arabs, stated Shahristani, as they must 
be assured that Iraq's resources will remain a national asset 
if they are to agree to any form of federalism.  The Charge 
concurred, stating that the USG strongly supports national 
ownership of natural resources, as any other form of 
ownership would weaken Iraq's ability to conclude 
international financing agreements. 
 
8.  (C/NF)  Shahristani added that the constitution may call 
for the creation of a development fund, another fund for 
investment, and a stabilization fund to help dampen 
fluctuations from future oil sales. 
 
------------------------------ 
Following Article 58 on Kirkuk 
------------------------------ 
 
9.  (C/NF) Shahristani said the parties have agreed to put 
off resolution of the Kirkuk debate until after the December 
elections per TAL Article 58.  The issue is too complex to 
negotiate now and should be resolved through the legal 
system, Shahristani said.  The Charge agreed and pointed to 
Kirkuk as a perfect example of why ownership of natural 
resources must be assigned to the national government.  "If 
ownership of natural resources were to be assigned to the 
regions, the Kirkuk matter would never be resolved" stated 
the Charge. 
 
--------------------------------------------- - 
TNA Developing; Special Tribunal and Elections Legislation 
Moving Forward 
--------------------------------------------- - 
 
10.  (C/NF) Assessing the state of TNA affairs, Shahristani 
opined that the body has its shortcomings, but is learning 
how to be an efficient legislative body.  The new referendum 
law is coming along well; the TNA intended to have the first 
reading of the election law on July 20, stated Shahristani. 
The TNA is also working on a revision of the Iraqi Special 
Tribunal (IST) Statute to make it impervious to legal or 
jurisdictional challenges. 
 
11.  (C/NF) Pressed by Charge whether the revised IST statute 
would bar the removal of a sitting IST judge formerly a 
low-level member of the Baath Party, Shahristani said the TNA 
is drafting language that will protect sitting judges from 
being challenged solely by reason of their former Baath Party 
membership. (Most IST Judges held low-level membership within 
the Baath Party, which was required of judges or attorneys 
practicing law during the former regime.) 
 
12.  (C/NF) Shahristani claimed that the TNA has not reached 
consensus on the new electoral law mainly because of Kurdish 
reservations.  But the law will most likely call for the 
establishment of provincial electoral districts as opposed to 
the single national district used in the January elections 
(Baghdad would be split because of its large population).  To 
protect minority groups (Christian, Sabean, Yazidis), the law 
would establish a single national electoral district with a 
number of Assembly seats set aside for various minorities. 
The modalities for this electoral system are unclear. 
 
13.  (C/NF) Shahristani expressed the view that the Kurds are 
warming up to this idea, but asked USG assistance in pushing 
the matter with the Kurdish leadership.  The Charge 
emphasized that we have informed senior Kurdish leaders that 
the USG supports growing national consensus on a 
provincial-based electoral system. Finally, Shahristani 
indicated that the TNA will request expert assistance from 
the UN and IECI to draft the new electoral law. 
 
14. (U) REO HILLA, REO BASRA, REO MOSUL, and REO KIRKUK, 
minimize considered 
Satterfield