VZCZCXRO7113
PP RUEHBC RUEHDE RUEHIHL
DE RUEHKUK #0117/01 1641334
ZNY CCCCC ZZH
P R 131334Z JUN 06
FM REO KIRKUK
TO RUEHC/SECSTATE WASHDC PRIORITY 0664
RUEHGB/AMEMBASSY BAGHDAD PRIORITY 0626
INFO RUCNRAQ/IRAQ COLLECTIVE
RUEHKUK/REO KIRKUK 0692

C O N F I D E N T I A L SECTION 01 OF 02 KIRKUK 000117 
 
SIPDIS 
 
SIPDIS 
 
BAGHDAD FOR POL, ECON, IRMO, NCT 
 
E.O. 12958: DECL:  6/13/2016 
TAGS: PGOV PREL PNAT KDEM KCOR EPET IZ IN
SUBJECT: PUK LEADERSHIP: PARTY CHANGE, KRG UNITY, IRAN 
 
KIRKUK 00000117  001.2 OF 002 
 
 
CLASSIFIED BY: Scott Dean, Regional Coordinator (Acting), Reo 
Kirkuk, Department of State . 
REASON: 1.4 (b), (d) 
 
 
 
¶1. (C) Summary. On May 31 PUK party leader Noshirwan Mustafa 
informed PRT/REO POLOFS that the number of new KRG ministries 
was linked to building support for the Kurds on the 2007 Kirkuk 
Referendum.  Further, the PUK would soon hold a congress to 
restructure the party to adapt to the new political realities in 
Iraq.  Finally, he likened the oil crises in Basra - and pending 
inability to pay government salaries - to the state collapse in 
Somalia.  In a separate meeting, Sulaymaniyah Governor Dana 
expressed concern over the disparity between Iran-Iraq border 
posts. End Summary. 
 
Excess of Ministries Linked to Kirkuk Referendum 
--------------------------------------------- --- 
 
¶2. (C) In a meeting with PRT Leader, Acting REO Coordinator and 
IPAO, Noshirwan Mustafa admitted the excessive forty-two 
ministries created as part of a unified KRG were part of a 
political strategy to build alliances with non-Kurd minorities. 
(NOTE: Smaller parties - composed mainly of Turkoman, 
Christians, Yezidis, and Faily Kurds - nearly doubled their 
representation from 6 to 11 ministries in the new government. 
END NOTE.) Once the 2007 referendum returned Kirkuk to the 
Kurdistan Region the number would be reduced. 
 
¶3. (C) Discussing Prime Minister Nuri al-Maliki's program for 
implementing Article 140, Mustafa said the first period of 
normalization entailed the return of IDP's and settlers to 
Kirkuk with compensation and the restoration of the Kirkuk 
Governorate to pre-1968 boundaries.  In the next step, an 
outside party such as the United Nations would supervise a 
census, after which the referendum would be held.  The KRG had 
already appointed Dr. Mohammad Ihsan as minister for areas such 
as Kirkuk that were outside the Kurdistan Region.  He added that 
Baghdad must follow through on ensuring a timely referendum as 
per Article 140. 
 
¶4. (C) Mustafa admitted the fourteen Kirkuk Provincial Council 
members who were currently demanding Kirkuk become a federated 
province were a problem.  He felt that non-Kurds in Kirkuk, such 
as Arabs who opposed Article 140 and the restoration of 
boundaries to pre-1968 status, should move to Mosul or Tikrit. 
 
Legal Issues at Heart of Full KRG Unification 
--------------------------------------------- 
 
¶5. (C) Mustafa said that before unifying the remaining 
ministries, conflicting laws between Sulaymaniyah and Erbil 
needed rectification, e.g. taxation, investment, and the 
personal status laws.  These were technical issues that, once 
resolved, would open the way for the ministries of Justice and 
Finance to unite. The Peshmerga ministries were the most 
difficult to merge because they had been enemies for over thirty 
years.  He said they wanted to avoid a scenario similar to the 
unification of East and West Germany where one side was absorbed 
- or "eaten" - by the other. 
 
¶6. (SBU) Mustafa said that the new ministries were meeting 
regularly in Erbil.  Although some employees had been let go, 
all continued to receive full salaries.  If the leadership 
provided a good example, he felt confident the combined KDP-PUK 
workforce would work together. 
 
Security Concerns Override Corruption for Investors 
--------------------------------------------- ------ 
 
¶7. (C) Mustafa said foreign companies were not investing in the 
Kurdistan Region because of the overall perception of poor 
security in Iraq, not because of corruption.  He said the KRG 
faced an unknown future because large companies such as GE or 
British Shell were not differentiating between the two when it 
came to security. "We can say we are fighting corruption however 
they still would not come."  He added that hundreds of Sunni and 
Shia Arabs were working in Sulaymaniyah as doctors, engineers, 
and professors, because it was safer than Baghdad. 
 
¶9. (SBU) To address investor concerns with infrastructure, he 
said a committee in parliament was drafting a new Investment 
Law.  At a recent meeting in Kuwait with potential investors, 
banking, land, and investment laws dominated the discussion. 
 
Reorganizing the PUK 
-------------------- 
 
¶10. (C) Mustafa said the PUK would soon hold a Party Congress in 
 
KIRKUK 00000117  002.2 OF 002 
 
 
order to rethink the direction and mission of the party.  Party 
members would elect participants, with representation for every 
1,000 members.  The goals of the congress include: 
 
-       Adapting the party platform to the post-Saddam era; 
-       Shifting the party structure from a communism-based 
Politburo to one that distributed power throughout the 
organization; and 
-       Reorganizing the leadership to include women and young 
people by replacing the 'revolutionary' governing model with a 
parliamentary methodology. 
 
¶11. (C) Mustafa said the demonstrations in Halabja and Kalar 
woke up both the KDP and PUK to the extent of public 
dissatisfaction with the status quo.  Further, Islamic parties 
such as the KIU were growing in popularity because of the lack 
of services, party-based corruption, and poverty. He said the 
parties had not distributed services, including access to 
health, education, housing, and electricity, equally. 
 
Basra Oil Crisis - Precursor to a Somalia 
----------------------------------------- 
 
¶12. (C) Mustafa stressed the importance of securing Basra for 
all of Iraq, stating that Basra's petrol revenues provided the 
majority of government salaries throughout the country.  The 
provinces were working as independent states because the 
interruption of oil flow had dissolved unity. He said Iraq now 
faced a state collapse similar to Somalia. 
 
Sulaymaniyah Governor Raises Border Disparity issue 
--------------------------------------------- ----------- 
 
¶13. (C) Sulaymaniyah Governor Dana raised in a separate meeting 
his concern over the disparity between conditions along the 
Iraq-Iran border.  He said that over the 415km where 
Sulaymaniyah bordered Iran, Iraq had only 15 poorly maintained 
police stations that had not been improved since the Peshmerga 
era; and yet Iran had invested more into upgrading the roads, 
providing troops with rockets, etc.  Dana said the disparity 
opened up the border to drugs, smuggling, and cross-border 
terrorism. 
 
Biographic Note: 
---------------- 
 
¶14. (C) Noshirwan Mustafa is one of the most respected senior 
PUK politburo members and widely expected to be one of those 
vying to replace Talabani. He is considered the thinker of the 
PUK and the only one who can rein in Kosrat Rasoul.  He speaks 
English well, however prefers to use translators for more 
sensitive topics. 
 
Comment: 
-------- 
 
¶15. (C) Both the KDP and PUK must adapt their parties to a new 
post-Saddam, post-Peshmerga Kurdistan. The increased popularity 
of the Islamic parties seems more daunting to the parties than 
general unrest over corruption and continuing poverty; however 
the impetus to update their agendas, however motivated, is 
heartening.  Dana's concern over Sulaymaniyah's loosely guarded 
border is in the domain of the Ministry of Interior in Baghdad, 
but without an MOI office in the region itself, the issue will 
probably not be addressed any time soon.  End comment. 
BIGUS