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S E C R E T SECTION 01 OF 05 BISHKEK 001196 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR SCA/FO, SCA/CEN 
 
E.O. 12958: DECL: 08/16/2016 
TAGS: PGOV PREL ENRG EINV MARR KG
SUBJECT: BOUCHER AND BAKIYEV:  BOTH PLEDGING TO MOVE FORWARD 
 
REF: BISHKEK 1195 
 
BISHKEK 00001196  001.2 OF 005 
 
 
Classified By: Amb. Marie L. Yovanovitch, Reason 1.4 (b) and (d). 
 
¶1. (C) SUMMARY. In an August 11 meeting with Assistant 
Secretary for South and Central Affairs Richard Boucher, 
 
SIPDIS 
President Bakiyev turned straight to investment issues, 
urging U.S. involvement in major hydro-electric projects. 
Surprising everyone with an about-face, Bakiyev said that the 
Kyrgyz Government would not exercise its right to supply 50% 
of the fuel to the Manas Air Base.  The President also 
expressed concern about rising extremism in southern 
Kyrgyzstan.  A/S Boucher responded that after years of good 
bilateral cooperation, the recent strains in the relationship 
had come as a surprise to the U.S.  He urged the President 
not to let false information come between the two countries 
again.  Boucher also urged Bakiyev to make a public display 
of support for Manas Airbase by attending an event there on 
September 11 (which Bakiyev agreed to) and to increase Kyrgyz 
attention to regional integration.  Bakiyev downplayed the 
recent strains and pledged that would be a "stable, reliable 
partner."  Throughout the meeting, Bakiyev said many of the 
right things about cooperation and moving forward, but his 
words also demonstrated that his decisions are subject to 
change and review, resulting in confusion and uncertainty. 
END SUMMARY. 
 
¶2. (C) On August 11, Assistant Secretary of State for South 
and Central Asia Richard Boucher met with President Bakiyev. 
Ambassador Yovanovitch and Senior Advisor Hayden accompanied 
Boucher.  Foreign Minister Jekshenkulov and Foreign Policy 
Advisor Ibragimov accompanied Bakiyev.  The Assistant 
Secretary's other meetings in Bishkek were reported reftel. 
 
SIPDIS 
 
--------------------------------------------- ---- 
IN SEARCH OF U.S. INVESTORS FOR KAMBARATA 1 and 2 
--------------------------------------------- ---- 
 
¶3. (C) The President welcomed A/S Boucher and noted that the 
bilateral relationship had been a good one for the past 15 
years and that Kyrgyzstan appreciates the assistance the U.S. 
provides.  He turned straight to business issues, noting that 
a number of large business projects are on the horizon, such 
as Kambarata 1 and 2, that might be of interest to U.S. 
investors.  He said that when there are close economic ties, 
all other questions in the bilateral relationship are more 
easily resolved.  He noted the Kazakhs and the Russians are 
interested in Kambarata 1 and 2, but they are dragging out 
the talks.  Moreover, they should be working together, as the 
project may prove too big for a single investor; it would be 
good if the U.S. were involved too.  The President noted that 
since Kambarata 1 and 2 are not part of the Cascade, it would 
be easier to finalize the legal aspects with parliament, 
which he expects to do in the fall.  On economic issues, the 
President said that economic growth is good, tax and customs 
revenues are flowing to the budget, and the fight against 
corruption has been successful.  Morale in Kyrgyzstan is 
high, according to the President, but he concluded that the 
American presence in this area should be stronger. 
 
--------------------------------------------- - 
KYRGYZSTAN NOT TO PARTICIPATE IN FUEL CONTRACT 
--------------------------------------------- - 
 
¶4. (C) Bakiyev noted that the bilateral relationship is 
strong in other areas as well and said the recently concluded 
base agreement had provided a good result.  "I understand the 
threats we face.  From the beginning, I knew we could do it," 
he said.  He added that "some politicians" had given the 
impression that Kyrgyzstan did not want the Base, but he, the 
President, had always been committed to the Base, as no 
country can fight terrorism alone.  Later in the meeting, 
Bakiyev said that the July agreement that Kyrgyzstan would be 
granted the right to provide 50% of the fuel could become a 
problem, because he cannot guarantee Kyrgyz performance.  The 
 
BISHKEK 00001196  002.2 OF 005 
 
 
President said that no Kyrgyz company has the capacity, and 
since fuel supply is a military issue, not a political issue, 
it should be treated as such.  Certain bureaucrats had made 
the fuel part of the July agreement, perhaps because "they 
wanted to make business" on the side, commented the 
President.  He concluded that people had criticized former 
President Akayev for profiting from past fuel contracts, and 
he did not want the same criticism leveled against himself. 
In sum, the President said he was ready for the Americans to 
supply 100% of the fuel. 
 
¶5. (C) Boucher responded that a reliable fuel supply is most 
important, and the U.S. Government appreciates the Kyrgyz 
flexibility on this issue.  Boucher added that the U.S. would 
appreciate a public demonstration of support for the Base and 
suggested visiting on September 11, the fifth anniversary of 
the attacks on the U.S.  President Bakiyev agreed. 
 
¶6. (C) On internal affairs, the President said that 
constitutional reform was moving forward and would be 
finished in the fall.  He did not think it was necessary for 
the Constitutional Assembly to decide on every article; they 
should merely make their views known regarding which form of 
government they prefer.  Then there would be further 
consultations with the Parliament.  He said he is ready to 
proceed with reform of the judicial system and law 
enforcement agencies, although it is not a simple matter: 
"We are on the threshold of reform," he claimed. 
 
------------------------------------ 
BOUCHER:  WHERE IS KYRGYZSTAN GOING? 
------------------------------------ 
 
¶7. (C) Boucher responded that his purpose in coming to 
Kyrgyzstan was to find out what was happening in the country 
and where it was headed.  He said that the last time he had 
spoken to the President, the President had requested a speedy 
conclusion to the base negotiations.  This had happened, and 
the U.S. was fulfilling its obligations as agreed in July. 
For his part, Boucher had asked that the President decrease 
the level of conflict with the opposition and involve civil 
society in the constitutional reform process, and Bakiyev had 
done this successfully. 
 
¶8. (C) Boucher reviewed the good cooperation that the U.S. 
and Kyrgyzstan have enjoyed over the years, but noted that 
the U.S. had been stymied by the two PNGs and the SNB 
operations against the Surveillance Detection Team.  Boucher 
stated that the Kyrgyz had acted on false information and 
incorrect interpretation.  He said we have taken reciprocal 
measures by PNGing two Kyrgyz diplomats and do not plan on 
taking further steps.  Boucher said that we are working with 
Kyrgyz Ministries to re-establish the Surveillance Detection 
Team in an atmosphere of complete transparency.  Boucher 
concluded that the U.S. and Kyrgyzstan will overcome this 
difficult period in bilateral relations, but Kyrgyzstan 
should take the lesson that false information, including from 
third parties, should not come between our two countries. 
The PNGing of two U.S. diplomats was a serious, even an 
unfriendly, action, and we don't want this to continue, 
Boucher said. 
 
----------------------- 
NORTH-SOUTH INTEGRATION 
----------------------- 
 
¶9. (C) On other issues, Boucher responded that the U.S. is 
actively promoting regional integration.  On north-south 
energy integration, Boucher noted that Kyrgyz representatives 
attended the U.S. Trade and Development Agency-sponsored 
conference on hydro-electricity in Istanbul in June, which 
had been useful, and the next step is a follow-on conference 
in Dushanbe in October.  He raised AES' interest in working 
in Kyrgyzstan, the work AES is doing in Tajikistan, some of 
which the U.S. is financing, and suggested that the Kyrgyz 
 
BISHKEK 00001196  003.2 OF 005 
 
 
work with AES, as well, to "create a whole" -- to which the 
President nodded.  Boucher said he had appointed a senior 
officer to his staff to convert the idea of integration into 
the reality of roads and electrical lines.  On trade, Boucher 
noted the big markets in Pakistan, and especially India, and 
said that Kazakhstan would be holding a conference on trade 
integration shortly.  In the end, he said, integrating the 
region makes economic sense. 
 
-------------------------------- 
BAKIYEV:  EXTREMISM IN THE SOUTH 
-------------------------------- 
 
¶10. (C) On the situation in southern Kyrgyzstan, the 
President said that religious extremism has been building for 
the last ten to fifteen years.  He cited recent incidents in 
Batken, Jalalabad, and Osh, including the killing of Mufti 
Mohammadrafiq Kamalov earlier in the week and said that the 
Government of Kyrgyzstan had information that not only 
Kamalov, but his brother, Sadykjan Kamalov, head of the 
International Center for Islamic Cooperation (Note:  and 
former International Visitor Program participant.  End Note.) 
were extremists, had direct contact with terrorists, and 
should be behind bars.  He said that the religious extremists 
were now no longer limiting themselves to disseminating 
literature, but were preaching an untrue version of Islam and 
how to overthrow the government.  The Kyrgyz government is 
working with "real" Islamic clerics to provide support in the 
South, Bakiyev said.  He added that the Kyrgyz government 
would "deal harshly" with terrorists in the South.  He noted 
that the capacity of the law enforcement agencies needed to 
be increased.  The Kyrgyz Government had requested assistance 
from the Russians and wanted the U.S.-donated helicopters to 
go to the SNB, as the SNB has no helicopters. 
 
--------------------------- 
SECURITY COOPERATION NEEDED 
--------------------------- 
 
¶11. (S) Boucher responded that the U.S. wants to continue 
security cooperation with the Kyrgyz and has generally 
experienced good cooperation.  The U.S. wants good relations 
with the SNB, but believes the SNB has spread false 
information about the U.S. and U.S. activities in Kyrgyzstan, 
and our bilateral cooperation program with the SNB has 
expired.  We would like to reactivate our cooperation, as 
both countries would benefit.  Boucher added that the U.S. is 
not trying to push any country, i.e. Russia, out of 
Kyrgyzstan; our goal is to support Kyrgyz goals and Kyrgyz 
sovereignty.  When Kyrgyzstan cooperates with many countries, 
it provides competition, which in turn provides more choices. 
 
 
----------------------- 
AGREEMENT ON UZBEKISTAN 
----------------------- 
 
¶12. (C) Boucher continued that he had just been in 
Uzbekistan, where he tried to re-establish a decent 
relationship, but it would be a hard-nosed relationship based 
on areas of specific interest.  He noted it cannot be as 
broad a relationship as with Kyrgyzstan, but that President 
Karimov had expressed interest in cooperating in the areas of 
security, and political and economic development, but that 
there could still be a positive relationship with the U.S. if 
Uzbekistan works at it.  Boucher noted that when Bakiyev 
meets with Karimov, he hopes that Bakiyev influences Karimov 
rather than the other way around.  With a grin, Bakiyev said 
that Karimov is "very hard," that he had just had a difficult 
conversation with him in Minsk, so he is not sure how 
constructive their meeting will be.  Boucher responded that 
this would be a shame for Uzbekistan, which is closing itself 
off.  As Bakiyev nodded, Boucher concluded that by leaving 
only one door open, Uzbekistan is losing opportunities. 
 
 
BISHKEK 00001196  004.2 OF 005 
 
 
--------------------------- 
REQUEST FOR HIPC ASSISTANCE 
--------------------------- 
 
¶13. (C) Bakiyev said he hoped that the U.S. would provide 
assistance in getting Kyrgyzstan into the Highly Indebted 
Poor Countries program (HIPC).  Kyrgyzstan was debating the 
issue, but the two billion dollars of debt weighed heavily on 
Kyrgyzstan and the President would appreciate if the U.S. 
could help in restructuring the debt burden.  The Ambassador 
responded that it had always been U.S. policy to support 
Kyrgyzstan's entry into the program. 
 
---------------------------- 
REQUEST FOR THRESHOLD STATUS 
---------------------------- 
 
¶14. (C) Bakiyev said that he had one final wish, that 
Assistant Secretary Boucher support Millennium Challenge 
Account Threshold Status for Kyrgyzstan.  Boucher responded 
that the U.S. is interested in going forward with judicial 
reform and will address this quickly when he returns.  He 
stated that given the events of the past month and a half, 
questions had been raised about the direction of the country 
and the direction of the relationship, but he hoped that the 
Kyrgyz would see the benefits of cooperation and reform. 
 
¶15. (C) Bakiyev replied that he had no doubts that the 
relationship would develop further.  "Kyrgyzstan," he said, 
"is a country that does not waver.  We will be a stable, 
reliable partner.  We won't switch priorities and we don,t 
switch partners."  Turning to the PNG issue for the first 
time in the conversation, Bakiyev said that the issue of the 
two PNGs was not his idea.  "Let's forget that.  Intelligence 
is intelligence.  I didn't decide this issue, and the Foreign 
Minister didn't approve this action."  Boucher thanked the 
President and concluded that the President should not let 
this happen again. 
 
------- 
COMMENT 
------- 
 
¶16. (C) Bakiyev came very well prepared to the meeting with 
Assistant Secretary Boucher.  The Kyrgyz goal was to put the 
tensions of July behind us, and Bakiyev succeeded, although 
he has been put on notice that the relationship cannot afford 
another PNG situation.   He is clearly most interested in the 
economic relationship, although he also said what we wanted 
to hear on constitutional reform and on the Base. 
 
¶17. (C) Bakiyev succeeded in surprising everyone -- including 
his own advisors -- when he announced that the Kyrgyz would 
not follow up on the July agreement to provide 50% of the 
fuel to Manas Air Base.  He clearly reveled in catching even 
his own staff off guard, and three days later they are still 
trying to figure out what this means:  does it mean that 
Kyrgyzstan will not participate at all or does it mean they 
will participate in the open tender for 100% of the fuel 
deliveries, or does it mean, as Security Council Secretary 
believes, that the Kyrgyz Government will start taxing fuel. 
Security Council Secretary Niyazov told us that he would 
clarify this with the President when the latter returns from 
Sochi on August 17.  He advised us to postpone for now the 
Defense Energy Support Center fuel team scheduled to arrive 
on August 15.  We reminded Niyazov that if taxation was the 
goal, the overall cost to the U.S. could not increase, and 
Niyazov agreed. 
 
¶18. (C) On the Highly Indebted Poor Countries program, the 
President apparently saw no irony in requesting assistance 
from the United States on this issue, although in April the 
Foreign Ministry had issued a public reprimand to the 
Ambassador for "interfering in internal issues" when she 
commented on it.  During this part of the conversation, the 
 
BISHKEK 00001196  005.2 OF 005 
 
 
Foreign Minister was determinedly studying the ceiling and 
would not meet the Ambassador's eye. 
 
¶19. (C) We also found it interesting that the President made 
a point of telling us that it was not the Foreign Minister, 
nor the President himself, who decided the PNG issue, it was 
the SNB.  First, this contradicts what he told us on July 12 
-- and what virtually everyone else in Bishkek is telling us. 
 Second, it begs the question of who is in charge of foreign 
policy if neither the President nor the Foreign Minister 
decide a question of such import. 
 
¶20. (C) The President's comments were constructive and 
forward-looking.  Nevertheless, many of his remarks, 
including the news regarding the fuel deal, where he was 
essentially using U.S. talking points, once again 
demonstrated that decisions are subject to repeated review. 
No decision is final, which leaves both Bakiyev's staff and, 
to a certain extent, the U.S. scrambling.  END COMMENT. 
 
¶21. (U) A/S Boucher has cleared this message. 
YOVANOVITCH