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DE RUEHMK #0530/01 0881422
ZNY SSSSS ZZH
O 291422Z MAR 06
FM AMEMBASSY MANAMA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4330
INFO RUEHZM/GULF COOPERATION COUNCIL COLLECTIVE PRIORITY
RHMFISS/HQ USCENTCOM MACDILL AFB FL PRIORITY
RHBVAKS/COMUSNAVCENT  PRIORITY

S E C R E T SECTION 01 OF 03 MANAMA 000530 
 
SIPDIS 
 
SIPDIS 
 
FOR T, NEA/ARP 
 
E.O. 12958: DECL: 03/28/2016 
TAGS: PREL PARM PTER BA BILAT CTR OFFICIALS
SUBJECT: SCENESETTER FOR UNDER SECRETARY JOSEPH'S APRIL 8 
VISIT TO BAHRAIN 
 
REF: A. STATE 47881 
     ¶B. STATE 45386 
     ¶C. MANAMA 0442 
     ¶D. MANAMA 0387 
 
Classified by Ambassador William T. Monroe for reasons 1.4 
(b) and (d). 
 
¶1.  (C) We warmly welcome Under Secretary Joseph's April 8 
visit to Bahrain.  The visit comes during a period of 
high-level bilateral engagement, which the Bahrainis seek and 
appreciate.  In the past six weeks, Commerce Secretary 
Gutierrez and State Department Counselor Zelikow came to 
Bahrain (Ref C).  Secretary Rice met with all GCC foreign 
ministers, including Bahraini Foreign Minister Shaikh Khalid 
bin Ahmed Al Khalifa, in Abu Dhabi.  Crown Prince Shaikh 
Salman bin Hamad Al Khalifa, accompanied by Shaikh Khalid, 
met with the Vice President, Secretary Rice, Secretary 
Rumsfeld, Secretary Gutierrez, National Security Advisor 
Hadley, Deputy Secretary of State Zoellick, Deputy Secretary 
of Defense England, and others during his March 19-22 visit 
to Washington (Refs A, B, D).  We have requested a meeting 
for you with Shaikh Khalid. 
 
---- 
Iran 
---- 
 
¶2.  (S) The issue most on the minds of Bahraini officials is 
Iran.  Dovetailing with Counselor Zelikow's presentation, the 
Crown Prince told the Secretary that the Iranian government 
thinks its influence in the region is growing.  Iran believes 
it is riding on a popular wave of support throughout the 
region and is trying to capitalize on the rise of Islamist 
parties, growing Islamic conservatism, and the 
Israeli-Palestinian conflict.  Bahrain feels particularly 
vulnerable because 70 percent of the population is Shia while 
the ruling family and most of the government leadership is 
Sunni.  Shaikh Khalid and Deputy Prime Minister Shaikh 
Mohammed bin Mubarak Al Khalifa agreed to the Counselor's 
proposal of a U.S.-GCC strategic dialogue on regional 
security, with a focus on Iran.  In Washington, the Crown 
Prince requested consideration of a formal U.S. or NATO 
security umbrella for Bahrain.  Bahrain is a member of the 
NATO Istanbul Cooperative Initiative and seeks to strengthen 
its ties to NATO. 
 
--- 
PSI 
--- 
 
¶3.  (C) In May 2005, we delivered a demarche on the 
Proliferation Security Initiative (PSI) and the Statement of 
Interdiction Principles to the MFA.  The official said he 
would review the materials but the MFA never responded 
formally.  He mentioned that knowing that other regional 
countries had joined the PSI could facilitate a Bahraini 
decision to do so.  Shaikh Khalid probably knows very little 
about the PSI, but he likely will be open to give serious 
consideration to a U.S. request for Bahrain's participation. 
 
--------- 
Financing 
--------- 
 
¶4.  (C) Bahrain has a well-developed financial industry and 
promotes itself as an international financial center in the 
Gulf region.  Over 50 off-shore banks have licenses to 
operate in the country.  Bahrain has an anti-money laundering 
law but has not yet passed a law to combat terrorist 
financing.  The regulatory authority, the Bahrain Monetary 
Agency (BMA), has a strong reputation among Gulf/Arab 
countries and Bahrain sees further development of the 
financial sector as key to its economic future.  The BMA has 
frozen assets and closed bank accounts in response to U.S. 
requests.  However, lack of capacity in the Office of the 
Public Prosecutor and the judiciary has hindered the 
successful prosecution of anti-money laundering cases. 
Officials from the public prosecutor's office and Ministry of 
Justice have taken specialized training courses to build 
their capacity in financial law.  The headquarters of the 
Middle East and North Africa Financial Action Task Force 
(MENA-FATF) is in Bahrain. 
 
--------- 
U.S. Navy 
--------- 
 
 
MANAMA 00000530  002 OF 003 
 
 
¶5.  (U) The U.S. Navy has worked closely with Bahrain for 
more than fifty years.  Bahrain is the only country in the 
region that hosts a permanent component command headquarters, 
specifically, headquarters facilities for the Commander of 
Naval Forces, U.S. Central Command (COMUSNAVCENT). 
COMUSNAVCENT directs naval operations in the Arabian Gulf, 
Arabian Sea, and Gulf of Aden in support of Operations 
Enduring Freedom and Iraqi Freedom, CJTF Horn of Africa, as 
well as Maritime Interception Operations to enable freedom of 
navigation and to prevent oil smuggling, piracy and various 
other operations in support of the Global War on Terrorism. 
Bahrain's relatively stable and secure political environment 
allows deployed U.S. Navy ships to stop, replenish supplies, 
and provide crews much needed onshore rest and recreation 
opportunities. In 2004, 421 U.S. Navy ships called at Manama 
while 377 ships called in 2005. Additionally, U.S. military 
and military-contracted air traffic at Bahrain's 
International Airport and other local facilities encompassed 
3521 landings in 2004 and 3415 landings in 2005. 
 
¶6.  (U) When the Navy withdrew its dependents from Bahrain in 
the summer of 2004, the fate of the DOD-run Bahrain School 
was in question.  The Crown Prince, who is a Bahrain School 
graduate and has two children in the school, visited 
Washington that summer and urged that it remain open.  The 
Defense Department made the commitment to keep the school 
open, and the school continues to operate at about half of 
its previous size.  Defense Department leadership has made a 
policy decision to keep the school open, alleviating local 
fears that the school might close.  The school provides an 
American education to a diverse student body of Americans, 
Bahrainis, Saudis and many other Arab, Asian, and European 
nationalities. 
 
------------------- 
Military Assistance 
------------------- 
 
¶7.  (U) The Bahrain Defense Force (BDF) maintains an 
infrastructure capable of handling U.S. deployments in 
support of our regional policies and forms the first line of 
defense for the headquarters of the U.S. Navy's Fifth Fleet. 
To continue to be an effective coalition partner, the BDF, 
which deployed its navy in support of Operations Enduring and 
Iraqi Freedom, must be fully compatible with the U.S. 
military.  Maintaining this capability has become 
increasingly expensive, stressing a BDF budget that is 
already insufficient to purchase the advanced U.S. hardware 
needed to achieve interoperability.  U.S. provided Foreign 
Military Financing (FMF) has been declining over the past few 
years, making it increasingly difficult for the BDF to meet 
its needs.  With the advent of a democratically elected lower 
house of parliament that requires the BDF to operate within a 
budget, funding for purchases under the Foreign Military 
Sales (FMS) program have also become scarcer.  FMF and 
International Military Education and Training (IMET) will 
continue to be important for both regional stability and 
force protection goals. FMF and IMET funding for 2006 are 
$15.593 million and $644,000 respectively.  Estimates for 
2007 are $15.750 million for FMF and $640,000 for IMET. 
 
---------------- 
Stinger Missiles 
---------------- 
 
¶8.  (C) Bahrain procured 70 Man Portable Stinger Missiles in 
1988 through the FMS program.  Section 705 of the 2000 
Security Assistance Act places a one-for-one replacement 
limit on Bahrain's Stinger Missile inventory.  Bahrain has 
not fired 57 of the original 70 missiles and has yet to 
demilitarize them although the U.S. Army has determined that 
they are beyond their 17-year shelf life.  Bahrain has 70 new 
replacement Stinger Missiles currently being stored in the 
U.S.  DOD agencies agree that the new missiles should not be 
shipped until Bahrain demils the remaining 57 missiles. 
 
¶9.  (C)  Bahrain's response has been two-fold:  request 
procurement of one Avenger system (HMMWV based Stinger 
Missile launch platform) in order to launch the 57 old 
missiles, and seek relief from the 70 missile ceiling cap. 
Bahrain signed a Letter of Offer and Acceptance to procure 
one Avenger system, funded through FMF, which should arrive 
by June 2006.  Bahrain will not commit to a speedy firing 
schedule of the 57 missiles once the system is delivered. 
The GOB has sought CENTCOM assistance in explaining their 
need to lift the cap to Congress.  CENTCOM's reply placed the 
onus on Bahrain to show the need for an increased missile 
inventory.  CENTCOM is staffing a proposal to offer a joint 
 
MANAMA 00000530  003 OF 003 
 
 
survey team to analyze Bahrain's short range air defense 
needs. 
 
-------------------------- 
CWC Host Country Agreement 
-------------------------- 
 
¶10.  (C) In late February, the MFA informed the Embassy via 
diplomatic note that it would sign a Chemical Weapons 
Convention Host Country Agreement (HCA) on challenge 
inspections with us.  We understand that Bahrain will become 
the first GCC country to sign an HCA with us.  The GOB views 
the HCA as a win-win, saying it protects both countries in 
the event of a challenge inspection.  They are concerned that 
Iran may invoke a challenge inspection of U.S. facilities in 
Bahrain in an attempt to cause friction between Bahrain and 
the United States.  The MFA proposed some minor edits and 
changes to the text that Washington agencies are now 
considering.  Depending on Bahrain's preferences for 
finalizing the agreement, it could be completed within weeks. 
 
----------------- 
Counter-Terrorism 
----------------- 
 
¶11.  (S) Cooperation on counter-terrorism has improved 
markedly since Bahrain fumbled the detention of several 
Bahrain terror suspects in June 2004, precipitating the 
departure of Navy dependents.  However, there remain 
concerns.  The terror suspects are under surveillance pending 
resolution of the court case, but the constitutional court, 
which is currently reviewing the case, may determine that 
they were charged under a law that is unconstitutional.  A 
counter-terrorism law that addresses conspiracy, among other 
issues, is stuck in the parliament and faces broad 
opposition.  Sunni extremists, though few in number, remain a 
concern.  We are providing assistance to the Ministry of 
Interior to stand up a Joint Counter-Terrorism Center, but 
progress has been uneven. 
 
---------- 
Guantanamo 
---------- 
 
¶12.  (C) There were six Bahraini detainees at Guantanamo 
until three were returned last fall.  Bahraini press coverage 
of the remaining three has been steady and intense, focusing 
on allegations of mistreatment and hunger strikes.  Foreign 
Minister Shaikh Khalid has come under parliamentary pressure 
to be a more aggressive advocate for their return, and he has 
told the press and parliament that he raises the issue with 
senior USG officials at every opportunity. 
 
MONROE