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PP RUEHLMC RUEHMR RUEHPA RUEHPB
DE RUEHDT #0095/01 0671052
ZNY CCCCC ZZH
P R 081052Z MAR 07
FM AMEMBASSY DILI
TO RUEHC/SECSTATE WASHDC PRIORITY 3341
INFO RUCNARF/ASEAN REGIONAL FORUM COLLECTIVE
RUCNDT/USMISSION USUN NEW YORK 0844
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC
RHHMUNA/HQ USPACOM HONOLULU HI
RUEHLI/AMEMBASSY LISBON 0804
RUEHBY/AMEMBASSY CANBERRA 0911
RUCNMCM/MCC COLLECTIVE
RHEFDIA/DIA WASHINGTON DC
RUEAIIA/CIA WASHDC
RUEHWL/AMEMBASSY WELLINGTON 0738
RUEHKO/AMEMBASSY TOKYO 0658
RUEHLO/AMEMBASSY LONDON 0619
RUEHDT/AMEMBASSY DILI 2688

C O N F I D E N T I A L SECTION 01 OF 03 DILI 000095 
 
SIPDIS 
 
NOFORN 
 
DEPT FOR EAP/MTS 
USUN FOR RICHARD MCCURRY 
PACOM FOR POLAD AND JOC 
SIPDIS 
 
E.O. 12958: DECL:  3/8/2017 
TAGS: PGOV MAAR KDEM KJUS KPKO UN AU TT
SUBJECT: GUSMAO EXPOUNDS ON REINADO, ELECTIONS 
 
DILI 00000095  001.2 OF 003 
 
 
CLASSIFIED BY: Stanley Harsha, Charge d'Affaires, US Embassy 
Dili, Department of State. 
REASON: 1.4 (b), (d) 
 
 
 
¶1. (C) Summary:  In a March 8 meeting, President Xanana Gusmao 
told Charge d'Affaires (CDA) he will no longer talk directly 
with Major Alfredo Reinado because of Reinado's history of 
stubbornness and duplicity in the President's direct 
negotiations with the rebel soldier.  The strategy remains for 
the International Stabilization Force (ISF) to smoke Reinado out 
and force his surrender or capture, and to avoid killing 
Reinado, Gusmao confirmed.  Gusmao also said he is sensitive to 
accusations that he is sympathetic to Reinado and helping him, 
another reason why he does not want to be directly in 
communication with Reinado.  The only GOET avenue of dialogue 
that Gusmao cited is through one or both of East Timor's 
Catholic Bishops who have been asked to attempt to persuade 
Reinado to surrender.  Gusmao agreed with our point that the 
Timorese military (F-FDTL) force deployment must not be expanded 
beyond its current static protection mandate and that their 
deployment must be carefully coordinated with the United Nations 
Integrated Mission in Timor-Leste (UNMIT) and the ISF. 
Describing in some detail his own plans to form a political 
party and sideline the powerful leftist "Maputo" wing of the 
ruling Fretilin party, Gusmao said registration of members for 
the new party he is forming has been completed in nine of the 
nation's 13 districts, and nearly so in the other 4 districts. 
He added that his party, National Council for Timorese 
Reconstruction (CNRT), will be formally declared on March 26. 
His plan is to contest the elections by forming a cooperative 
association with the coalition of three opposition parties, 
Democratic Party (PD), Social Democrat Party (PSD), and Social 
Democrat Association of Timor-Leste (ASDT).  CNRT's main role 
will be to siphon off the moderate "Mudansa" faction in 
Fretilin, leaving the core Maputo group moribund.  End Summary. 
 
 
Military dissidents 
------------------- 
 
¶2. (C) In a March 8 meeting with the CDA, Deputy Chief of 
Mission (DCM) and U.S. Defense Representative (USDR), President 
Xanana Gusmao recounted the long history of his personal efforts 
to persuade Major Alfredo Reinado to surrender, including 
several meetings last year when Reinado repeatedly said he would 
only obey Gusmao as his supreme commander.  Gusmao said he 
replied tartly to Reinado at one meeting that his command was 
for Reinado to surrender, to which Reinado replied "anything but 
that."  Explaining how his attitude towards Reinado has 
fluctuated from anger to calm deliberation, Gusmao described 
Reinado as incorrigibly obstinate.  Gusmao noted that Reinado's 
ego is reinforced by the "petitioners" (several hundred F-FDTL 
soldiers dismissed in 2006 after they complained of 
discrimination) and the Movement for National Unity and Justice 
(MUNJ) supporters, who feed Reinado's heroic sense of self to 
the point that he believes he is disappointing followers if he 
surrenders (Note: MUNJ is a loose anti-Government coalition.). 
CDA also emphasized to Gusmao that the U.S. Government fully 
supports GOET efforts to apprehend Reinado in cooperation with 
the ISF, and that they should be unflagging in their efforts to 
do so. 
 
¶3. (C/NF) Gusmao also related a story of how he met with MUNJ 
supporters of Reinado at 6 p.m. March 3, the night of the ISF 
assault, to discuss a possible resolution to the stand-off in 
Same.  Gusmao furthermore theorized that Reinado knew of the 
imminent ISF assault because his hilltop vantage point would 
have enabled him to spot the deploying assault force.  Reinado 
would have correctly assumed that there was a sudden force 
build-up occurring near his position consisting of special 
operations forces and that an assault was imminent.  Gusmao 
appears to have offered this theory to refute suggestions that 
Reinado was tipped off.  (Note:  Both Prime Minister Ramos Horta 
and Australian sources suggested to us that Reinado was tipped 
 
DILI 00000095  002.2 OF 003 
 
 
off regarding the operation against him, thus facilitating his 
escape.  End note.) 
 
¶4.  (C/NF)  Gusmao also said military petitioner leader 
Lieutenant Gastao Salsinha was no longer with Reinado and was 
now willing to give up his weapons.  Prior to the ISF action 
against Reinado, Salsinha had viewed Reinado's actions as 
justified, according to Gusmao.  Now, Gusmao believes that 
Salsinha has changed his thinking on this matter. 
 
Political landscape 
------------------- 
 
¶5. (C) Gusmao also laid out his strategy to unseat the "Maputo 
clique" of Fretilin.  (Note: Most of this group of 
Portuguese-educated political leaders spent the Indonesian 
occupation era in Mozambique.)  Although opposition parties PD, 
PSD, and ASDT leaders have all expressed their opposition to 
Gusmao's formation of a new party and have refused to back his 
preferred presidential candidate, Ramos-Horta, Gusmao claimed 
that all parties are now in agreement that they must unite 
against the Maputo faction as the common enemy.  He said his 
temporary alliance with the three opposition parties is to 
alleviate concerns that CNRT will steal their membership base. 
Thus, Gusmao said that following the April 9 presidential 
elections, the three opposition parties, CNRT, and the Mudansa 
(reform) wing of Fretilin would unite in the campaign to defeat 
Fretilin in the parliamentary elections.  This would not be a 
coalition but rather a cooperative alliance ultimately aimed to 
defeat all vestiges of the Maputo clique.  Gusmao said elections 
will be held on June 20, although he has not yet announced this 
publicly.  Following elections each party, including a 
reinvigorated and reformed Fretilin led by the freshly-emerged 
Mudansa wing, would go back to competing against with one 
another.  Gusmao then stated that following the elections the 
Maputo members can take their passports so that "they can leave 
East Timor and go wherever they wish." 
 
¶6. (C)  Gusmao said the CNRT has already gathered in excess of 
the 1500 signatures needed for registration, and has completed 
registration in nine of the nation's 13 districts, and nearly so 
in the other four remaining districts so that the party could be 
represented nationwide.  He also noted that it has been 
difficult for CNRT to register voters as the other existing 
political parties had already grabbed most of the eligible 
voters.  He suggested that once the next Parliamentary 
configuration takes shape, the ideal would be for Parliament to 
consist of just five parties:  PD, PSD, ASDT, CNRT and a 
diminished Fretilin. 
 
¶7. (C) Gusmao also offered an analogy that highlighted the 
fundamental differences between himself and Fretilin Secretary 
General Mari Alkatiri regarding the direction of the nation.  He 
suggested imagery of a dirty old man in poor health, who at 
least had his pride.  Gusmao stated that this is the East Timor 
of Alkatiri - a wrecked nation with poor infrastructure and 
little systemic basis for meaningful development, but in 
possession of all sovereign faculties - even though these 
faculties might be non-functioning.  Gusmao said that the nation 
had to move beyond this mentality if it was to modernize and if 
its people were to exist within a modern, democratic context. 
 
Sigh of Relief on Lobato verdict 
-------------------------------- 
 
¶8.  (C)  Asked about his views on the Rogerio Lobato verdict, 
Gusmao exhaled a big sigh of relief, expressing satisfaction 
that the guilty verdict and relatively heavy sentence had 
precluded more unrest.  Gusmao sidestepped a question on whether 
he thinks the verdict would be upheld on appeal.   CDA asserted 
that progress towards a better justice system and implementation 
of the Commission of Inquiry (COI) recommendations would be 
important in addressing the root causes of discontent.  Gusmao 
nodded in agreement but avoided answering a question about 
progress in responding to the COI report.  Asked about progress 
in meeting with the petitioners, Gusmao confirmed that dialogue 
 
DILI 00000095  003.2 OF 003 
 
 
between the petitioners and the F-FDTL would occur soon but was 
vague on details. 
 
¶9.  (C) Gusmao also noted that lack of social justice, 
particularly among the nation's unemployed youth, is a major 
impediment to achieving stability, noting that a new government 
will be needed before any progress can be made.  He repeatedly 
referred to the current government as taking a hole and making 
it bigger, instead of fixing it, having nothing positive to say 
about current leadership. 
HARSHA