VZCZCXRO0193
PP RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK RUEHMOS
DE RUEHKU #1933 1481744
ZNR UUUUU ZZH
P 281744Z MAY 06
FM AMEMBASSY KUWAIT
TO RUEHC/SECSTATE WASHDC PRIORITY 4723
INFO RUCNRAQ/IRAQ COLLECTIVE PRIORITY

UNCLAS KUWAIT 001933 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR NEA/ARP 
 
E.O. 12958: N/A 
TAGS: ECON EAID PGOV PREL IZ KU
SUBJECT: KUWAIT FUND REPORTS LIMITED PROGRESS ON ASSISTANCE 
DISBURSALS TO IRAQ 
 
REF: A. KUWAIT 883 
     ¶B. KUWAIT 399 
 
Sensitive but unclassified.  Not for internet distribution. 
 
¶1.  (SBU) Summary:  During a May 22 meeting with Econoff, the 
Kuwait Fund for Arab Economic Development's (KFAED) Regional 
Manager for Arab Countries cited no progress, other than a 
preliminary report on school construction, pertaining to the 
GOK's $560M reconstruction package for Iraq (ref B).  The 
KFAED official also voiced concern about the replacement of 
former Iraqi Planning Minister Barham Salih (trusted KFAED 
interlocutor) and the likelihood of further delays in aid 
disbursal if new Planning Minister Ali Baban decides to 
revisit the terms of KFAED's December agreement with the 
Iraqi Transitional Government (ref B para 4).  The official 
also said that planning for a proposed KFAED-hosted donor 
meeting for Iraq's power sector needs (ref A) are on hold 
pending renewed dialogue with the new Iraqi government.  End 
Summary 
 
¶2.  (SBU)  On May 22, Econoff met with Marwan Al-Ghanem, 
Regional Manager for Arab Countries at KFAED to follow-up on 
the GOK's $560M reconstruction assistance package for Iraq 
(see ref B for package details).  Al-Ghanem explained that 
there was no significant progress on aid disbursals to Iraq 
since his last meeting with Econoff on March 8.  He explained 
that Iraqi officials' efforts to form a new government had 
put on hold all dialogue with KFAED on reconstruction 
assistance.  According to Al-Ghanem, KFAED officials are 
concerned that the replacement of former Iraqi Planning 
Minister Barham Salih (now Deputy Prime Minister), a trusted 
KFAED interlocutor, could result in further aid disbursal 
delays if Salih's replacement, Ali Baban, decides to revisit 
the terms of the December agreement on allocation of the 
GOK's $560M assistance package (ref B). 
 
¶3.  (SBU) Despite the lack of bilateral dialogue over the 
past several weeks, Al-Ghanem pointed to some progress on the 
initial $30M grant (out of $60M) for school construction (see 
ref B for allocation details), explaining that the joint 
Kuwaiti-Iraqi consulting firm hired to conduct a feasibility 
study had completed its preliminary report.  The report would 
be reviewed by the KFAED and Iraqi Ministry of Education 
officials before a final design and tendering phase is 
authorized.  Al-Ghanem estimates construction to begin no 
earlier than this winter. 
 
¶4.  (SBU) Al-Ghanem also stated that initial KFAED plans to 
host an Arab donors meeting to fund Iraq's northern power 
station (see ref A) were now on hold pending renewed contact 
with the new Iraqi government.  He was unable to predict when 
planning would resume.  (Note:  The Ambassador is scheduled 
to meet KFAED Director General Al-Bader on May 29 to urge 
greater GOK outreach with the new permanent Iraqi government. 
 End note). 
 
******************************************** 
For more Embassy Kuwait reporting, see: 
http://www.state.sgov.gov/p/nea/kuwait/?cable s 
 
Or Visit Embassy Kuwait's Classified Website: 
http://www.state.sgov.gov/p/nea/kuwait/ 
******************************************** 
LEBARON