VZCZCXRO7720
RR RUEHBC RUEHDE RUEHIHL RUEHKUK
DE RUEHGB #2552/01 2130749
ZNY CCCCC ZZH
R 010749Z AUG 07
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC 2571
INFO RUCNRAQ/IRAQ COLLECTIVE

C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 002552 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 07/31/2017 
TAGS: ECON ENRG PGOV IZ
SUBJECT: ANBAR FORUM PLANNING MEETING WITH DPM BARHAM SALIH 
 
REF: A. BAGHDAD 2494 
     ¶B. BAGHDAD 2431 
     ¶C. BAGHDAD 843 
 
Classified By: Economic Minister Charles P. Ries for reasons 1.4 (b) an 
d (d). 
 
¶1. (C) Summary: The Anbar Provincial Council Chair, Anbar 
Governor, Deputy Prime Minister for Economic Affairs Barham 
Salih and Ministry of Finance Director General for Accounts 
met in Baghdad July 29 with PRT Anbar Team Leader Soriano, 
Economic Minister Ries, MNF-W Deputy Commanding Brigadier 
General Allen, and BGen Winfield Scott to discuss the next 
"Anbar Forum," a conference focused on economic development 
in the province, planned for early September.  This forum 
aims to follow the military success in Anbar with economic 
gains, and to further develop the province's relationship 
with the central government.  Specific requests brought to 
DPM Salih's attention at this meeting include the following: 
increasing the 2007 GOI budget allocation to Anbar Province 
from $107 million to $177 million, launching a free trade 
zone along the Jordanian border, providing crude oil to the 
refinery in Haditha, and repairing the road from Ramadi to 
Qaim on the Syrian border.  DPM Salih welcomed these 
suggestions, and said he will designate staff to follow up on 
them in advance of the Anbar Forum.  A task force from the 
Embassy, MNF-I Strategic Effects, and PRT Anbar will work 
with the Deputy Prime Minister's office to finalize 
preparations and potential deliverables for the September 
event in Ramadi.  End summary. 
 
---------------- 
BUDGET EXECUTION 
---------------- 
 
¶2.  (C) As security in Anbar Province continues to improve, 
the PRT, MNF-W and provincial officials have begun to focus 
on developing key economic initiatives (ref A).  The meeting 
with DPM Barham Salih is part of ongoing efforts to 
strengthen the relationship between Anbar and the central 
government.  Anbar Governor Ma'amoun Sami Rasheed described 
the progress the provincial government has made on budget 
execution.  He said the provincial government has tendered 
projects equal to all of the 2007 budget allocation of $107 
million (except for a 10% reserved for contingencies) and 
received 1000 bids for these projects.  The Governor plans on 
signing the first contracts within the next two weeks.  He 
said he could fully fund all of the projects submitted in the 
province if Anbar were allocated an additional $70 million. 
Reallocations by the Ministry of Finance are authorized by 
the 2007 Budget Law, in order to remove funds from 
under-spending provinces and ministries and allocate them to 
areas able to execute projects (ref C).  By the end of the 
meeting DPM Salih agreed to support the extra funding on the 
condition that the provincial government had truly contracted 
its existing allocations.  He also encouraged Dr. Ghazi, 
Director General of Accounts at the Ministry of Finance, to 
make sure that Anbar Province receives its allocations 
quickly and that provincial officials can prove that they 
have executed their existing allocations.  (Note: DPM staff 
and Dr. Ghazi agree that the Ministry of Finance will not 
need the Council of Representatives' approval to make such 
transfers, given the 2007 Budget Law.  End note.)  DPM Salih 
requested that the Governor give him a written report about 
the additional needs of the province and report on progress 
in executing the existing allocations within the next two 
weeks.  He said that the GOI should be ready to reallocate 
funds by the third week in August. 
 
--------------------- 
ANBAR FREE TRADE ZONE 
--------------------- 
 
¶3.  (C) The group also discussed the development of a free 
trade zone along the Jordanian border, with possible 
connections to free trade zones and telecommunication 
infrastructure within Jordan itself.  Provincial officials 
and USG representatives underscored the benefits of a free 
trade zone in Anbar, and MNF-W noted the possibility of 
converting an old Iraqi military base for civilian use in 
this area.  DPM Salih expressed a great deal of interest in 
the idea, linking it to proposals for free trade zones in 
Basra and Sulimaniyah (ref B).  DPM Salih designated Ahmed 
Salman, his chief of staff, to work on this issue along with 
others in his office, and EMin offered staff support from the 
Embassy.  DPM Salih requested further planning for this zone 
to take place within the next two weeks, particularly with 
regards to location, infrastructure requirements and business 
focus.  Ahmed Salman told econoff separately that the legal 
framework for establishing free trade zones already exists in 
Iraq, based on a 1998 law, and said that the Minister of 
Finance had just signed a letter authorizing the 
establishment of a free trade zone in Sulimaniya. 
 
BAGHDAD 00002552  002 OF 002 
 
 
 
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HADITHA REFINERY AND THE RAMADI - QAIM ROAD 
------------------------------------------- 
 
¶4.  (C) The Provincial Governor also asked for assistance in 
revamping the Haditha refinery, providing sufficient 
electricity and sources of crude oil.  The Governor said that 
this type of large project would have a significant effect on 
the economy in Anbar, lower prices for fuel, and address the 
high levels of unemployment.  He also asked that the road 
between Ramadi and Qaim, which runs past the Haditha 
refinery, be repaired, as this will also allow for imports 
from Syria when the border crossing is open.  DPM Salih said 
he would contact the Minister of Housing and Construction, 
responsible for public roads, and ask her to work on this 
road.  Governor Ma'amoun Sami Rashid also noted the severe 
shortage of electricity in Anbar, and DPM Salih said that he 
would urge the Minister of Electricity to assist in finding a 
solution. 
 
---------------------------------- 
REQUEST FOR HOUSING RECONSTRUCTION 
---------------------------------- 
 
¶5.  (C) BGen Allen highlighted other economic initiatives in 
the province, including micro-loan projects with a capital of 
$1 million, and progress in building telecommunications 
infrastructure.  He also supported the provincial official's 
request for GOI support for reconstruction of houses in 
Ramadi now that the security situation has improved.  DPM 
Salih was initially opposed to this idea, because of the cost 
(estimated at $300 million) and because he considered such a 
program 'easy money' with few economic benefits.  BGen Allen 
noted that such funding had been offered to Fallujah, and 
while estimates to repair the damage in Ramadi were high the 
actual costs would be less; in Fallujah settlements were 50% 
of claims and residents made up the difference through their 
own investment.  EMin Ries encouraged the DPM to think of a 
program designed to take place over time with a combination 
of investment options, underscoring how important this 
reconstruction was to the people in Ramadi.  DPM Salih agreed 
that a carefully designed plan for this reconstruction might 
work, and mused that perhaps the government could supply 
assistance "in kind" (cement, bricks, etc) to ensure 
reconstruction actually took place. 
 
------- 
COMMENT 
------- 
 
¶6.  (C) This planning meeting was an important step towards 
developing concrete deliverables for the Anbar Forum in early 
September, which all present agreed should take place in the 
provincial capital of Ramadi.  The provincial officials were 
enthusiastic about the prospects for progress in Anbar, and 
the Deputy Prime Minister committed to ensuring that the 
central government supported the province's development.  A 
task force from the Embassy, MNF-I Strategic Effects, MNF-W 
and PRT Anbar will work with the Deputy Prime Minister's 
office to finalize logistical preparations and attainable 
deliverables for the September event in Ramadi. 
CROCKER