VZCZCXYZ0000
RR RUEHWEB

DE RUEHGB #1308/01 1061645
ZNY SSSSS ZZH
R 161645Z APR 07 ZDK DE RUEHCB 7386 1071057
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC 0751
INFO RUCNRAQ/IRAQ COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHDC

S E C R E T BAGHDAD 001308 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 04/15/2017 
TAGS: ETRD EINV KBCT IZ
SUBJECT: ARAB LEAGUE BOYCOTT ACTION PLAN 
 
REF: A. STATE 42386 
     ¶B. 2006 BAGHDAD 4690 
     ¶C. 2006 BAGHDAD 4067 
     ¶D. 2006 BAGHDAD 3797 
 
Classified By: Ambassador Ryan Crocker for reasons 1.4 (b) and (d). 
 
¶1. (C) Summary: As requested in ref A, post has outlined an 
aggressive action plan with mission-wide support and input 
from State, Commerce and Treasury.  Given the high-level 
attention of events in Iraq, GOI officials will expect 
important issues to involve pressure from all levels of the 
USG.  Increased pressure on the GOI may lead to Iraqi 
politicians making public statements in support of the Arab 
League Boycott.  We understand Washington's request for an 
aggressive action plan on this important policy issue.  One 
major positive development is that the Ministry of Health is 
making concrete steps towards reform of its procurement 
agency, a source of many of the ALB complaints.  We look 
forward to responses to the suggested plan from the April 19 
Deputies meeting.  End summary. 
 
--------------------------------------------- - 
Effective GOI Engagement Requires VIP Pressure 
--------------------------------------------- - 
 
¶2.  (C) As detailed in ref B, Embassy Baghdad has repeatedly 
raised concerns about the Arab League Boycott (ALB) at all 
levels of the government.  Our engagement is constrained, 
however, by the lack of attention from high-level USG 
officials during visits to Iraq.  Iraqi officials understand 
Washington's focus on events in the country, and expect that 
important issues will be raised by visiting Assistant 
Secretaries, Under Secretaries, Deputy Secretaries and 
 
SIPDIS 
cabinet-level officials.  Given the importance of engagement 
on ALB as described in ref A, such visitors may want to focus 
more on ALB during their visits in-country.  We would 
appreciate Washington support in briefing principals on ALB 
engagement prior to their visits to Iraq. 
 
----------------------------------------- 
Chief Enforcer of ALB No Longer in Power: 
Progress at the Ministry of Health 
----------------------------------------- 
 
¶3.  (S/NF) Certain working-level engagement with specific 
enforcers of the ALB, such as the Ministry of Health, has 
been very difficult in the context of the Iraqi security 
situation.  As the head of a Sadrist Ministry, the Minister 
of Health (MoH) was often constrained in his cooperation with 
USG officials ) although recent detentions of MoH officials 
have enabled engagement with more moderate elements.  The 
Ministry itself has been shelled in the past few months by, 
one assumes, Sunni insurgents, and the building is off-limits 
to visits from embassy personnel.  The Health Attache has had 
specific death threats levied against her, and requires extra 
protection even within the International Zone.  In one 
instance, Econoff held a constructive discussion about ending 
ALB enforcement with the Director General (DG) of Kimadia, 
the procurement arm for the Ministry of Health; the DG was 
removed from office by the Minister of Health the following 
day (ref C). 
 
¶4.  (S/NF) As illustrated by the Department of Commerce's 
list of ALB complaints, the Ministry of Health's procurement 
arm is responsible for many instances of the boycott 
language.  Since the February arrest of the Deputy Minster of 
Technical Affairs, mission engagement with the MoH has 
greatly improved.  Kimadia is understood to be a problem at 
the MoH, and a USG-funded National Capacity Development 
project is being developed to reform it.  In the meantime, 
the Prime Minister has signed an agreement to allow the US to 
act as a contracting agent for Kimadia using the Foreign 
Military Sales (FMS) mechanism.  Should this agreement be 
finalized, Kimadia will have no ability to require ALB 
language in its contracts, eliminating a major source of ALB 
complaints in Iraq. 
 
--------------------------------------------- ------- 
Increased Pressure May Lead to Increased Enforcement 
--------------------------------------------- ------- 
 
¶5.  (C) Iraqi politics encompasses a wide spectrum of 
opinions and perspectives.  Statements said during private 
discussion can differ in both tone and meaning from those 
made in public.  Econoffs noted that the televised discussion 
during the Council of Representatives (CoR) plenary debate on 
the Investment Law included several strong proposals to 
include ALB language in the law itself, yet low-profile 
engagement with key members of the CoR Economic committee and 
party leaders resulted in no such language in the final law 
(ref D).  An aggressive action plan may lead to a public 
discussion of the issue that results in more, not less, ALB 
enforcement.  We should be aware of the possibility of this 
outcome when devising the ALB action plan.  Furthermore, the 
next few months will be critical to the CoR review of the 
hydrocarbon laws, and popular perception of trade pressure 
from the U.S. may affect our ability to effectively argue 
other policy priorities.  Ongoing discussions with Gulf 
Countries about Iraqi debt relief, including the 
International Compact with Iraq launch on May 3 may also be 
affected by the timing of this plan.  Fair trade practices 
remain a core U.S. policy priority, and Iraq's steps towards 
accession to the WTO indicate that the leadership understands 
the need for open trade. 
 
------------------- 
ALB GOI Action Plan 
------------------- 
 
¶6.  (C) Embassy representatives from State, Treasury, and 
Commerce have developed the following action plan from April 
15 - June 30 2007: 
 
April 15 - June 30      * Ongoing engagement with GOI 
working-level officials, including staff from the Deputy 
Prime Minister for Economic Affairs' Office, Ministry of 
Industry and Minerals, Ministry of Oil and the Ministry of 
Health (where possible). 
 
April 22                * Embassy provides talking points to 
all of the current IRMO Senior Consultants to deliver to a 
consistent and aggressive message about the negative impacts 
of ALB enforcement.  We will ask Senior Consultants to report 
ALB enforcement in procurement and contracting within their 
assigned ministries. 
 
April 15 - June 30      * High-level engagement by visiting 
Assistant Secretaries, Under Secretaries, Deputy Secretaries 
and Secretaries, particularly from the Departments of 
Commerce, Treasury and State. 
 
May 1 - May 15          * Urge Foreign Minister Zebari at the 
Ambassadorial level to disband the ALB office at the Ministry 
of Foreign Affairs, and end Iraqi participation in ALB 
meetings. 
 
May 10 - May 20         * Enlistment of support of Deputy 
Prime Minister for Economic Affairs to resolve existing 
complaints of ALB enforcement, using the list of complaints 
compiled by the Department of Commerce. 
 
June 1                  * GOI finalizes use of FMS to 
contract for Kimadia procurement, eliminating a major source 
of ALB complaints. 
 
April 15 - June 30      * Encouragement by FCS for US 
companies to immediately report any attempts at ALB 
enforcement to the Dept of Commerce.  Commerce is requested 
to inform the Embassy of new complaints at the earliest 
possible time. 
 
¶7.  (U) Post looks forward to review and comment of this 
action plan. 
CROCKER