US embassy cable - 03COLOMBO561

UNCLAS COLOMBO 000561 
 
SIPDIS 
 
FOR D, A/S ROCCA, USAID/AA/ANE WENDY CHAMBERLIN AND IRAQ 
TASK FORCE 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: EAID, ECON, EAGR, IZ, CE, UN, External Relations, Political Parties 
SUBJECT: TFIZ01: SRI LANKA PROPOSES TO SELL THE U.S. TEA FOR 
HUMANITARIAN AID TO IRAQ 
 
 
1. (U) This is an action request, please see para. 8. 
 
2. (U) The government of Sri Lanka (GSL) has proposed 
selling the USG about USD 2 million in tea to include in US 
humanitarian aid to the people of Iraq.  Minister of 
Plantation Industries Lakshman Kiriella made the pitch to 
the Ambassador on April 2, outlining GSL's rationale for the 
proposal.  Sri Lanka, he said, has traditionally supplied 
tea to Iraq, most recently under the UN's Oil for Food 
program.  When conflict broke out two weeks ago, Sri Lankan 
tea sales to Iraq halted, with a devastating effect on the 
local tea industry - particularly on the "low-grown" teas 
traditionally sold to Iraq.  Large quantities of "low-grown" 
went unsold at the March 25 tea auction, prompting the GSL 
make this request.  Kiriella made the pitch for the U.S. to 
make this USD 2 million purchase at the next scheduled tea 
auction on April 8. 
 
3. (SBU) Kiriella emphasized that "low-grown" tea is 
typically farmed by small landholders (about 260,000 people 
working one acre or so each), who are more susceptible to 
market disruptions than large plantation companies. 
Furthermore, "low-grown" tea is farmed mainly in regions of 
Sri Lanka's south where the left-wing JVP party is active. 
GSL is particularly worried that a prolonged downturn in 
"low-grown" tea sales will increase JVP support in the 
region.  A large US tea purchase now, Kiriella said, would 
help dampen this effect. 
 
4. (U) The Ambassador listened politely, but cautioned 
Kiriella that his proposal was not likely to be a winning 
one, particularly on short notice. 
 
5. (U) Kiriella added that GSL intends to make its own 
humanitarian grant of tea to Iraq.  But the amount GSL can 
afford to give (about USD 50,000) will neither meet Iraqi 
demand nor bring an appreciable benefit to affected farmers. 
GSL therefore is requesting US assistance to buy a much 
larger amount of tea, about USD 2 million worth. 
 
Comment 
------- 
 
6. (SBU) Post is, of course, not recommending that the U.S. 
purchase Sri Lankan tea in order to neutralize an upswing in 
support for the opposition JVP.  Still, it is true that a 
large-scale surge in support for the JVP could threaten a 
delicate peace process.  Post believes the GSL is right to 
be concerned about the effect of the war in Iraq on its 
economy and, by implication, the nation's prospects for 
peace. 
 
7. (U) Post further recognizes that the Department is 
consumed with pressing humanitarian concerns in Iraq, and 
that consumption of tea is not a matter of life and death 
for the people of Iraq.  Nonetheless, the GSL proposal does 
present an opportunity to offer comfort food to the people 
of Iraq, while addressing a critical threat to the Sri 
Lankan economy.  Post presents the proposal for the 
Department's consideration as what would be a very small 
part of the overall humanitarian assistance package for 
Iraq.  If the Department is interested in this 
unconventional idea, then it is true that a salutary effect 
could be achieved by purchasing the tea at the April 8 
auction. 
 
Action Request 
-------------- 
 
8. (U) Post requests the Department to examine whether a USD 
2 million tea purchase from Sri Lanka fits into our overall 
humanitarian assistance strategy for Iraq. Please advise. 
 
WILLS