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DE RUEHCL #0773/01 1871732
ZNY CCCCC ZZH
P 061732Z JUL 06
FM AMCONSUL CASABLANCA
TO RUEHC/SECSTATE WASHDC PRIORITY 6928
INFO RUEHAS/AMEMBASSY ALGIERS 2815
RUEHMD/AMEMBASSY MADRID 3651
RUEHFR/AMEMBASSY PARIS 0478
RUEHRB/AMEMBASSY RABAT 7637
RUEHTU/AMEMBASSY TUNIS 1940

C O N F I D E N T I A L CASABLANCA 000773 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR NEA/MAG AND NEA/PI 
 
E.O. 12958: DECL: 07/05/2020 
TAGS: ECON PBTS PGOV MO
SUBJECT: IT'S THE ISLAMISTS, NOT THE POLISARIO! CASABLANCA 
BUSINESS ELITES ON THE WESTERN SAHARA 
 
Classified By: Principal Officer Douglas Greene 
for reasons 1.4 (b) and (d) 
 
¶1.  (C) Summary:  Conversations with Casablanca business and 
financial elites reveal different priorities and perspectives 
than political elites on the issue of the Western Sahara. 
Whereas government contacts emphasize resolution of the 
Western Sahara conflict as a national priority, Casablanca 
business contacts rarely, if ever, initiate discussion on the 
issue and feel it does not impact them significantly. 
Business leaders, not surprisingly, advocate instead for 
different national priorities: improvements to the investment 
climate, educational initiatives and judicial reform.  If 
specifically asked about the Western Sahara, many will echo 
broader Moroccan public opinion (that any negotiated 
settlement short of Moroccan sovereignty is unacceptable). 
However, our contacts also suggest Government of Morocco 
(GOM) commitment to address the issue internationally may not 
be sincere.  Business contacts argue that the palace cannot 
afford the political costs that would come from the necessary 
concessions required for any negotiated settlement. 
Furthermore, they argue, the regime directly benefits from 
the territorial dispute despite the continuing costs of 
military occupation and would be unlikely to shift gears 
anytime soon, especially with 2007 parliamentary elections a 
year a way.  End Summary. 
 
--------------- 
Risky Business 
--------------- 
 
¶2.  (C)  In recent weeks, we have engaged business and 
financial sector contacts in discussions on political issues, 
including GOM policy on the Western Sahara.  Some business 
contacts have suggested that GOM requests for U.S. 
intervention to "resolve" the Western Sahara dispute are not 
entirely sincere, arguing that the palace cannot afford the 
political risks associated with any sort of compromise, 
particularly with parliamentary elections a year away. 
Business contacts say that the palace prefers to protect its 
political capital for promoting domestic reforms and does not 
want to put at risk the good will the monarchy currently 
enjoys from the majority of the Moroccan populace. 
 
¶3.  (C)  Business leaders also tell us that the regime 
directly benefits from the Western Sahara as a political 
issue.  Western Sahara serves as an effective rallying cry 
for Moroccan nationalism and solidifies support for the 
palace role in protecting Morocco's security interests. 
Holding firm on the Western Sahara protects the regime's 
nationalist flanks and unites the Moroccan people behind the 
monarchy.  As one business contact explained, "It is not a 
coincidence that the Green March happened shortly after two 
unsuccessful coup attempts.  The Western Sahara has always 
served this purpose." 
 
---------------------------------------- 
Western Sahara- Now Where Is That Again? 
---------------------------------------- 
 
¶4.  (C)  Business contacts say they are disengaged from the 
Western Sahara issue and are quick to identify other 
priorities, consistently citing the investment climate, 
education, and judicial reform as essential for Morocco's 
development.  Western Sahara is seen as an abstraction that 
does not intrude on the active day-to-day lives of 
Casablanca's bankers, businessmen and young entrepreneurs. 
As one Casablanca-based banker remarked, "I was born in 1975, 
the year of the Green March, and this is the first time I've 
talked about (Western Sahara) with anyone since, (pause), I 
don't even remember."  When asked about the costs of 
Morocco's continued occupation of the disputed territory, 
business contacts maintain the regime can continue to afford 
Western Sahara-related expenditures at current levels, 
although they express regret at the neglected reform 
initiatives the money could otherwise fund.  "Yes it is 
expensive," one businessman responded, "But what is the 
alternative?" 
 
¶5.  (C)  Many business leaders also maintain that resolution 
of the Western Sahara dispute is not a necessary precondition 
for improving relations (particularly economic) between 
Morocco and Algeria.  They argue that the GOM is willing to 
engage and negotiate issues apart from Western Sahara 
discussions, but insist it is Algeria that continues to link 
Western Sahara to other "non-related" issues at the expense 
 
of increased bilateral economic ties. 
 
-------------- 
Fait Accompli 
-------------- 
 
¶6.  (C)  Business contacts argue that a regime strategy of 
stalling on the Western Sahara suits the monarchy's long-term 
goal: unquestioned sovereignty over the disputed area.  The 
longer the regime holds-out and avoids committing to a 
compromise-laden negotiated settlement, the more likely it 
will ultimately possess the region by default.  This is 
referred to by some in Casablanca's francophone business 
community as the policy of "Fait Accompli."  Business 
contacts comment on the regime's tactic of co-opting the 
region through investment in social services and 
infrastructure in a overt attempt to consolidate influence, 
likening it to Israeli use of settlements in the West Bank. 
As one prominent investment banker explains, "Yes, we spend a 
lot of money there, but it is not all military.  Much of it 
is a long-term investment." 
 
¶7.  (C)  Other business and financial contacts insist that 
undiscovered oil reserves in the Western Sahara will 
eventually compensate for the expenses of securing the 
region.  These claims are highly speculative, however, and 
described by other contacts as "wishful thinking."  That 
said, one oil-industry contact remains optimistic, arguing 
that an "oil-less" Morocco would be a "geological anomaly." 
 
---------------------------- 
It's The Islamists, Stupid! 
---------------------------- 
 
¶8.  (C)  Comment:  The Casablanca business elite, while 
located apart from the political capital, boasts close 
association with members of the royal inner circle.  As such, 
the broader business community often has insights useful in 
understanding the King's strategy and motives.  But business 
community disinterest in prioritizing Western Sahara puts it 
seemingly at odds with many political elites.  With elections 
a year away, business leaders wary of growing Islamist 
encroachment in the public sector continue to press for U.S. 
attention toward other priorities, such as establishment of 
U.S. universities in Morocco and increased assistance for 
judicial reform.  For them, it is the Islamists, not the 
Polisario, who pose the greatest threat.  End Comment. 
GREENE