US embassy cable - 05CAIRO6577

C O N F I D E N T I A L SECTION 01 OF 03 CAIRO 006577 
 
SIPDIS 
 
STATE FOR NEA/ELA, NEA/RA 
NSC FOR ABRAMS AND POUNDS 
USTR FOR DONNELLY 
 
E.O. 12958: DECL: 08/25/2015 
TAGS: PGOV, PREL, ECON, EAID, ETRD, EG 
SUBJECT: VISIT OF NEA ASSISTANT SECRETARY WELCH:  MEETING 
WITH PRIME MINISTER NAZIF 
 
 
Classified by Charge D'Affaires Stuart Jones, for reasons 1.4 
(b) and (d). 
 
------------ 
Summary 
------------ 
 
1.  (C) NEA Assistant Secretary Welch met with Egyptian Prime 
Minister Nazif on August 18 to discuss bilateral and regional 
issues.  Welch pointed out that the U.S. had delivered on its 
promise of greater engagement on the peace process and would 
engage further as both sides made progress.  The 
international community would be carefully examining the 
upcoming elections in Egypt.  Although the U.S. 
Administration was confident of the GOE's handling of reform, 
Congress was more skeptical.  Movement on the issue of QIZs 
could be affected by Congress' perceptions of Egypt's 
elections.  Moreover, the issue of a license for Radio Sawa 
was an irritant in the bilateral relationship.  The U.S. 
needed assistance in combating terrorism, particularly in 
Iraq.  The U.S. would try to be fair and accurate in its 
advisory regarding the recent terrorist incidents in Sinai. 
Nazif stated that the message he wanted to convey about the 
elections was that the GOE had tried to make them as free and 
fair as possible.  His staff was working on reform of the 
media reform and the Radio Sawa issue could be resolved in 
that context.  He was hoping for greater reform of U.S. 
assistance to Egypt, and hoped to have issues in the Sinai 
sorted out soon.  End summary. 
 
------------------------ 
The Peace Process 
------------------------ 
 
2.  (C) Nazif noted that he had been asked during his visit 
to the U.S. last spring what the U.S. needed to do to improve 
its image in the Middle East.  He answered that greater 
engagement on the peace process was the best thing the U.S. 
could do in the region.  A/S Welch pointed out that he 
personally had made 7 trips to the region in the last 4 
months, so the U.S was delivering on its promise of more 
engagement.  The U.S. would increase its engagement as both 
sides continued to make progress on the roadmap.  Special 
Negotiator Wolfenson was working to define the post-Gaza 
disengagement agenda, and had a plan for Palestinian economic 
development, which was a key component of that agenda.  Egypt 
had been helpful in the process, and that was very much 
appreciated. 
 
------------------------------- 
Egypt's Reform Agenda 
------------------------------- 
 
3.  (C) Nazif said his visit to the U.S. had also helped him 
to focus his message about reform in Egypt.  The key 
component of the message was that change was happening and 
would continue.  The upcoming presidential election had 
solidified the reform agenda, which now included cancellation 
of the emergency law, creating a better balance between 
presidential and parliamentary powers, and increasing 
opportunities for the opposition in parliament.  Nazif noted 
that each of these points came up during his meetings with 
the U.S. Congress last spring, and they were all now part of 
the reform agenda.  Implementation of these reforms, however, 
would not be accomplished until after the next elections. 
 
 
---------------------------- 
Presidential Elections 
---------------------------- 
 
4.  (C) Regarding the upcoming elections, Welch said that the 
international community would be looking at 4 things.  First, 
the numbers:  how was voter turnout and what percentage of 
the eligible population voted?  Second, the visuals:  were 
the visuals of happy voters at the polls or protestors being 
beaten in the streets?  Third, the opposition:  to what 
extent did the opposition participate in the elections? 
Fourth, transparency:  when observers looked at the overall 
election process, what would they find, and who would they 
find behind the opposition when they looked closely?  Welch 
noted that the entire region was talking about Egypt's 
elections, and Al Jazeera had devoted a lot of airtime to the 
topic.  Although elections were held in Lebanon, they would 
not have the same impact as the elections in Egypt. 
 
5.  (C) Nazif agreed that the entire region was interested in 
what was happening in Egypt, but real political reform would 
take time.  The presidential elections were a first step, but 
Egypt was not going to be a Western democracy overnight. 
Some of the things the international community would be 
looking at were out of the GOE's control.  For example, the 
opposition needed to actually organize and get involved.  The 
Al Wafd party had only recently begun developing a platform. 
Nazif pointed out that all political parties had free access 
to the media, and the GOE was airing an advertisement that 
would encourage people to vote.  The print media, however, 
was uneven in its coverage of the candidates, giving too much 
coverage to Mubarak.  Although he expected criticism of the 
election process, the message he hoped to convey was that the 
GOE had tried to make the elections as free and fair as 
possible.  He also noted that although the GOE had rejected 
international monitors, interested observers and the media 
would be welcome.  His staff was setting up a "welcome/help 
desk," which would provide information for observers and 
possibly conduct tours. 
 
6.  (C) Nazif expressed appreciation for Deputy Secretary 
Zoellick's recent statement about Egypt, and said he hoped to 
continue coordinating with the U.S. on Egypt's reform 
message.  He noted that Minister of Foreign Trade Rachid 
would be visiting the U.S. soon to discuss reform and 
expansion of the QIZs.  Welch replied that the Administration 
was confident that Egypt could handle reform, but would 
nevertheless have to comment on the elections.  POTUS had 
already told Nazif his thoughts during their meeting last 
spring.  Congress, however, was quite skeptical and would 
scrutinize the elections closely.  It would be hard to change 
perceptions in Congress, especially if questions arose over 
the legitimacy of the elections.  Rachid's visit was timely, 
as trade was an area in which Congress could react negatively 
if the elections didn't go well.  Moreover, the 
Administration was moving cautiously right now, as CAFTA had 
just squeaked through Congress.  Welch encouraged Nazif to 
travel to the U.S. himself after the elections.  He also 
pointed out that the GOE needed to make better use of 
international media to get out the reform message.  He noted 
that international media was present in Egypt and readily 
accessible.  A good starting point would be explaining that 
the GOE had solidified its reform agenda.  Nazif replied that 
he was exploring use of the media to convey the reform 
message and head off criticism of the upcoming elections. 
 
--------------- 
Radio Sawa 
--------------- 
 
7.  (C) Continuing on the issue of media, A/S Welch raised 
the issue of a license for Radio Sawa.  Nazif explained that 
Mubarak had rejected issuing a license to Radio Sawa as a 
condition for U.S. assistance.  Had the licensing issue not 
been tied to assistance, it might have been resolved.  A/S 
Welch pointed out that the issue had been on the agenda for a 
long time, but there had been no movement, and this is what 
prompted Congress to tie the issue to assistance.  Nazif 
repeated that Mubarak would not accept licensing as a 
condition for continued assistance.  He pointed out that his 
staff was working on reform of the regulatory framework of 
the media.  The current law, which permitted only government 
media, would be changed and the Radio Sawa issue could be 
resolved in the context of overall reform.  Nazif noted that 
Nile TV was undergoing privatization and that a regulatory 
body was being created to separate media regulation from 
production.  Once this new body was in place, licenses would 
be issued, including to Radio Sawa. 
 
8.  (C) Welch asked if it would be possible to receive 
assurances that the Radio Sawa issue would be resolved in the 
context of media reform.  Nazif replied that a decision on 
that would have to come from President Mubarak.  He was not 
sure if assurances were possible, but offered to share his 
staff's plan for media reform.  Charge pointed out that the 
message that reached the U.S. was that media reform would 
take at least 5 years.  Nazif replied that he thought it 
would happen much sooner and that he had already signed one 
Prime Ministerial decree related to the reform.  Welch said 
that Rachid should prepare to explain the issue during his 
visit to the U.S., as it would be raised in his meetings with 
U.S. officials. 
 
-------------------- 
U.S. Assistance 
-------------------- 
 
9.  (C) Continuing on the issue of U.S. assistance, Nazif 
said that he would like to see additional review of how U.S. 
assistance funds were spent.  A/S Welch replied that the U.S. 
was eager for more reform of the assistance program, and that 
tying assistance to the GOE's reform agenda would be well 
received in Congress.  U.S. support for political reform was 
now narrowly focused, so additional reform of the assistance 
program should include support for broad socio-economic 
reforms.  A/S Welch pointed out that the USAID Director in 
Cairo was very supportive of increased reform of the 
assistance program. 
 
-------------------- 
Progress in Iraq 
-------------------- 
 
10.  (C) Turning to Iraq, Nazif asked how the political 
process was progressing.  Welch replied that progress had 
been made; importantly, it was now an Iraqi process. 
Security was really the main issue.  Jihadis were coming into 
Iraq through Syria.  Saudi Arabia understood the importance 
of controlling the border, and even Iran was doing a better 
job controlling its border than Syria was.  The jihadis saw 
Iraq as the new frontier in the fight against the "infidel." 
The U.S. needed support from its friends, not just on 
security issues but in the political and intellectual realm 
as well.  Welch noted the positive outcome of the recent 
Islamists' meeting in Jordan.  Nazif replied that terrorism 
was a concern for everyone, as it was growing and occurring 
everywhere now.  Terrorist cells could now get to new 
recruits without even meeting with them face to face. 
 
----------------- 
Sinai Attacks 
----------------- 
 
11.  (C) Regarding recent events in the Sinai, Welch said 
that the U.S. would try to be accurate and fair in its 
advisory about travel to the Sinai.  Although the GOE did not 
believe an advisory was necessary, one had been issued after 
the London bombing, so one was needed for Sinai too.  Charge 
Jones noted that the U.S. advisory would essentially caution 
U.S. citizens to avoid the Sinai until the GOE had the 
situation under control.  In that regard, Jones inquired how 
the GOE investigation of the attacks was proceeding.  Nazif 
replied that while the GOE was investigating the actual 
attacks, it was also looking at the socioeconomic issues 
underlying the outbreak of violence.  South Sinai was 
prosperous and developed, while the north was poor and filled 
with petty crime such as drug and migrant smuggling. 
 
12.  (C) Nazif said he didn't think the overall economy would 
be affected by the July 23 bombings in Sharm el Sheikh.  Gulf 
businessmen were moving conferences to Sharm el Sheikh to 
support Egypt after the terrorist attacks, as nobody wanted 
to see Egypt's economy falter.  Although Sharm itself was 
running at 40% capacity, the rest of the country's hotels 
were full of visitors from the Gulf.  He hoped the U.S. 
advisory would not include areas other than the Sinai, such 
as the Red Sea coast, to which Charge Jones replied that it 
wouldn't.  A/S Welch asked if there would be an Arab League 
summit in Sharm.  Nazif replied that there would be, but 
probably after the presidential elections.  Welch asked if 
the GOE planned to do anything on the tenth anniversary of 
former Israeli Prime Minister Rabin's death.  Nazif said that 
if Gaza disengagement went well, the GOE would consider doing 
something positive. 
 
13.  (U) This message was cleared by A/S Welch. 
 
 
Visit Embassy Cairo's Classified Website: 
http://www.state.sgov.gov/p/nea/cairo 
 
You can also access this site through the 
State Department's Classified SIPRNET website. 
 
JONES