VZCZCXYZ0015
OO RUEHWEB

DE RUEHKL #1587/01 2301105
ZNY CCCCC ZZH
O 181105Z AUG 06
FM AMEMBASSY KUALA LUMPUR
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7399
INFO RUEHKL/ISLAMIC CONFERENCE COLLECTIVE PRIORITY
RUEHLB/AMEMBASSY BEIRUT PRIORITY 0019
RUEHLO/AMEMBASSY LONDON PRIORITY 0280
RUEHFR/AMEMBASSY PARIS PRIORITY 0159
RUEHTV/AMEMBASSY TEL AVIV PRIORITY 0138
RUEHJM/AMCONSUL JERUSALEM PRIORITY 0064
RUEHUNV/USMISSION UNVIE VIENNA PRIORITY 0100
RUCNDT/USMISSION USUN NEW YORK PRIORITY 0976

C O N F I D E N T I A L KUALA LUMPUR 001587 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 08/17/2016 
TAGS: PGOV PREL IS LE MY
SUBJECT: MALAYSIA REACTS TO CEASEFIRE 
 
REF: A. KUALA LUMPUR 1559 
 
     ¶B. KUALA LUMPUR 1354 
     ¶C. KUALA LUMPUR 1397 
     ¶D. KUALA LUMPUR 1377 
 
Classified By: Deputy Chief of Mission David B. Shear 
for reasons 1.4 (b, d) 
 
¶1.  (C)  Summary:   Malaysian officials have welcomed the 
passage of United Nations Security Council resolution (UNSCR) 
1701, and the Malaysian media's preoccupation with the Middle 
East crisis has quickly diminished.  GOM officials reaffirmed 
their commitment to a lasting peace in the Middle East and 
reiterated their commitment to send peacekeeping troops to 
support the United Nations Interim Force in Lebanon (UNIFIL). 
Despite some rhetoric and political posturing, Malaysia 
seems willing to work with the UN in determining what, if 
any, Malaysian forces would appropriately augment UNIFIL. 
Until they were corrected by the Prime Minister, leaders of 
the United Malays National Organization (UMNO) Youth movement 
called for boycotts of American products and for a cessation 
of Free Trade Agreement (FTA) negotiations. UMNO Youth 
leaders admit they are making concessions to their 
conservative base, but have generally returned their focus to 
the domestic agenda.  Calls for a boycott of American 
products largely fell on deaf ears, but the demand that the 
GOM terminate the FTA talks reflects the extent to which the 
GOM will have to work in order to generate domestic support 
for an FTA.  End Summary. 
 
----------------------- 
GOM Supports UNSCR 1701 
----------------------- 
 
¶2.  (C)  Senior Malaysian officials including Prime Minister 
Abdullah Badawi and Foreign Minister Hamid have strongly 
supported the ceasefire in Lebanon.  Notwithstanding recent 
reports that Israel may object to peacekeeping forces from 
nations that do not have diplomatic relations with Israel, 
Abdullah, Deputy Prime Minister Najib Tun Razak and FM Hamid 
have all declared publicly that Malaysia will send troops to 
support UNIFIL over Israel's objections.  However, privately, 
Malaysia's Under Secretary for Multilateral Affairs Shahrul 
Ikram has told us that Malaysia will naturally allow the 
United Nations Department of Peacekeeping Operations to 
decide if Malaysia should send troops and what their 
composition would be.  He also reported that Malaysia wants 
to help, but will naturally work through the UN to ensure 
UNIFIL has the appropriate composition to complete the 
mission. 
 
-------------------------------------- 
And the Negative Public Rhetoric Cools 
-------------------------------------- 
 
¶3.  (C)  The Malaysian public and media reacted strongly to 
the Lebanon crisis, and, in addition to sustained criticism 
of the U.S. in the local press, the Embassy experienced 
demonstrations on several Friday afternoons at the end of 
July that were larger and noisier than usual.  But the 
passage of UNSCR 1701 and the August 14 implementation of the 
ceasefire in Lebanon quickly deflated much of the negative 
political rhetoric prevalent in Malaysia after the start of 
hostilities.  Politicians and reporters have largely returned 
their attention to domestic politics: a new budget session in 
parliament scheduled to begin on September 1, preparations 
for the November UMNO General Assembly, and former Prime 
Minister Mahathir's jabs at the government.  Despite 
overwhelming coverage of the war prior to the ceasefire, most 
newspapers did not headline the implementation of the 
ceasefire, nor did they give front-page billing to the return 
of displaced Lebanese families back to southern Lebanon. 
Malaysian officials have continued calls for comprehensive 
peace and reaffirmed their commitment to send peacekeeping 
troops to Lebanon (ref A). 
 
-------------------------------------------- 
Khairy Jamaluddin: Criticizes the FTA Talks; 
Calls for Boycott of U.S. Goods 
-------------------------------------------- 
 
¶4.  (C) UMNO Youth deputy chairman and Prime Ministerial 
son-in-law Khairy Jamaluddin's antics provided a sometimes 
entertaining, sometimes maddening diversion throughout the 
Lebanon crisis.   Khairy's influence on his father-in-law and 
 
some of his recent financial dealings have been the target of 
former Prime Minister Mahathir's ire for several months, and, 
no doubt sensing that political opportunity knocked, he 
decided to lead a highly visible UMNO Youth effort to flay 
the U.S. for its support of Israel.  He organized a large and 
noisy but non-violent July 21 rally in front of the Embassy 
during which he was pictured by the press at the Embassy's 
gate, haranguing marchers with a bull horn.  Khairy led a 
July 28 demonstration on the Kuala Lumpur Convention Center 
during Secretary Rice's participation in the ARF, demanding 
unsuccessfully to deliver a harshly worded petition to the 
Secretary, and his appearances often seemed to direct more 
attention to himself than to his cause.  The frenetic Khairy 
also called for a stop to U.S.- Malaysia FTA talks and for a 
boycott of the "American" brands Coca-Cola and Starbucks, 
statements that were rebuffed by the Prime Minister. 
 
¶5. (C)  Khairy has been less vocal since the cease fire went 
into effect.  Our subsequent meetings with UMNO Youth 
executive committee leaders confirmed that UMNO Youth 
rhetoric over the past two months was intended to appeal to 
UMNO's more conservative base.  They have told us that it was 
also aimed at preventing the Islamic opposition party PAS 
from gaining momentum given the recent clashes between 
Abdullah and former Prime Minister Mahathir Mohamed (ref D). 
Having achieved those ends, UMNO Youth has returned to its 
preparations for the UMNO General Assembly in November and 
the general elections anticipated for next year.  We expect 
the occasional jab from Khairy and his UMNO buddies as 
preparatory meetings for the November UMNO General Assembly 
continue, but we doubt the drumbeat will reach the decibel 
levels heard through late-July and early August. 
 
--------------------------------- 
Calls for Boycott Not Threatening 
--------------------------------- 
 
¶6.  (C)  Khairy's call for the GOM to boycott the US seems to 
have gained little traction publicly and politically. U.S. 
firms operating in Malaysia are watchful, but not overly 
concerned by Khairy's calls for a boycott.  The local 
Coca-Cola bottler recalled that a similar boycott call in 
2002 following the U.S. invasion of Afghanistan had no impact 
on sales.  Both the Coke and Starbucks franchisees (the local 
operations actually are owned by Malaysian companies) plan to 
take no action, believing the best approach is not to draw 
further attention to the issue.  At the monthly meeting of 
the board of governors of the American-Malaysian Chamber of 
Commerce (AmCham) August 16, members expected that the 
boycott would fade quickly, so long as the situation in 
Lebanon remains under control.  The board also agreed to take 
no action in response to the call for a boycott at this time. 
 
-------------------------------- 
Effect on FTA Remains To Be Seen 
-------------------------------- 
 
¶7.  (C) We doubt that the Lebanon crisis itself had a lasting 
negative effect on GOM support for the FTA talks.  But 
Khairy's opportunistic attack on the talks underscores the 
extent to which the negotiation may be vulnerable to 
Malaysian domestic politics.  At a minimum, it also 
demonstrates the extent to which the GOM will have to work to 
convince even the ruling party's rank-and-file of the 
benefits of a FTA with the U.S. 

LAFLEUR