US embassy cable - 03OTTAWA1865

UNCLAS OTTAWA 001865 
 
SIPDIS 
 
SENSITIVE 
 
FOR EB 
DEPARTMENT PLEASE PASS USTR 
 
E.O. 12958: N/A 
TAGS: ECON, ECIN, EFIN, ETRD, EINV, ETTC, PREL, PTER, LE, XF 
SUBJECT: A/S WAYNE'S MEETING WITH FAHIM MOUDAD, DEPUTY 
GOVERNOR, BANQUE DU LIBAN 
 
 
 1.  (SBU)  Summary:  During a bilateral meeting held June 25 
on the margins of the International Arab Banking Summit in 
Montreal, A/S Anthony Wayne and Fahim Moudad, Deputy Governor 
of the Banque du Liban, discussed the fight against terrorist 
financing; cooperation on Iraq; and the Lebanese economy and 
implementation of Paris II.  End summary. 
 
Cooperation on Combating Terrorist Financing, Tracking Iraqi 
Assets Will Continue 
--------------------------------------------- --------- 
 
2.  (SBU) A/S Wayne thanked Moudad for his strong support in 
the fight against terrorist financing and for Lebanon's solid 
cooperation in freezing Iraqi Assets.  Moudad responded that 
"we do our duty,"  adding that it (participation in the 
international effort) is important to Lebanon's financial 
system.  He was extremely receptive to the possibility of 
assisting the forensic accountants sent by the Iraqi Central 
Bank, saying the new Governor "can ask for anything" and 
Lebanon will respond. 
 
New Anti-money Laundering Law has Passed 
---------------------------------------- 
3.  (SBU) Asked the status of Lebanon's anti-money laundering 
law, Moudad said it has been passed and is working well.  He 
explained that the independent Special Investigation 
Commission provided for in the law has been very effective, 
and he confirmed that banks are reporting suspicious 
transactions to the SIC.  Asked if the USG could provide any 
assistance, he reiterated that systems to prevent 
money-laundering and terrorist financing are functioning 
well. 
 
4. (SBU) Asked his views on the economic situation, Moudad 
said stability is important to investors and to banks.  The 
Central Bank is working to keep confidence in the financial 
system, and he expects to meet requirements of Basel II 
within 2-3 years.  He confirmed that Paris II implementation 
is off to a good start, and that the drop in interest rates 
from 14%-8%, reflects market confidence.  The GOL needs to 
keep the budget deficit under control and to focus on 
privatization and securitization.  (He did not go into detail 
on privatization plans.) 
 
5. (U)  A/S Wayne cleared this cable. 
 
 
CELLUCCI