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DE RUEHMO #4490/01 2560557
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O 130557Z SEP 07
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC IMMEDIATE 3777
INFO RUCNRAQ/IRAQ COLLECTIVE PRIORITY
RUEHZG/NATO EU COLLECTIVE PRIORITY

C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 004490 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 09/11/2017 
TAGS: PREL PINR ECON IQ RS
SUBJECT: RUSSIA TO FOCUS ON BILATERAL ECONOMIC COOPERATION 
DURING IRAQI FM VISIT 
 
REF: A. MOSCOW 4305 
     ¶B. BAGHDAD 3064 
 
Classified By: Ambassador William J. Burns for reasons 1.4(b,d). 
 
¶1.  (C) Summary: MFA Deputy Director of Middle East and North 
Africa Department Aleksandr Kinshak previewed for us 
preliminary GOR plans for Iraqi FM Zebari's trip to Moscow, 
currently scheduled for September 18-21.  The GOR will seek a 
commitment from Zebari to reactivate the Russia-Iraq 
Intergovernmental Commission, which it views as the proper 
mechanism for resolving pending oil contracts and boosting 
Russian economic activity in Iraq.  Kinshak said Russia will 
not move forward on debt reduction until the Iraqi government 
"acknowledges Russian economic interests."  The GOR proposed 
that Zebari meet FM Lavrov, Industry and Energy Minister 
Khristenko -- the Russian chair of the dormant 
Intergovernmental Commission -- and with Russian journalists 
and business leaders.  Kinshak confirmed that Lavrov will not 
attend the UNGA Ministerial on Iraq, but will participate in 
the October 31-November 1 Iraq Neighbors Ministerial in 
Istanbul.  The Ambassador will meet with Zebari on September 
19 and reiterated to DFM Saltanov the need to move on debt 
relief now -- a point he will also meet stress in upcoming 
meetings with Presidential Aide Prikhodko and Finance 
Minister Kudrin.  End Summary. 
 
Zebari Visit to Focus On... 
--------------------------- 
 
¶2.  (C) On September 12, MFA Deputy Director of Middle East 
and North Africa Department Aleksandr Kinshak told us the MFA 
has yet to finalize a program for Iraqi FM Zebari, who will 
be in Moscow from September 18-21.  The only meeting nailed 
down thus far is a wide-ranging meeting with FM Lavrov; 
Kinshak said the MFA is still waiting to hear from Zebari's 
office on its list of proposed meetings and topics. 
 
...Political Situation in Iraq 
------------------------------ 
 
¶3.  (C) Kinshak noted Russia's interest in Zebari's views on 
Iraqi efforts to achieve a political settlement in the 
country, including plans for the October 31-November 1 
Neighbors Ministerial in Istanbul.  Referring to the 
possibility of a U.S.-Iraq bilateral agreement on the 
presence of U.S. troops in Iraq, Kinshak said the GOR will 
query Zebari on GOI deliberations on the extension of the 
UNSC mandate for the Multinational Force.  Russia will also 
solicit Zebari's assessment of Iraq's current relations with 
its neighbors Iran, Syria, and Turkey. 
 
...Deepening Economic Ties 
-------------------------- 
 
¶4.  (C) Russia will push Zebari to agree to reactivate the 
Russia-Iraq Intergovernmental Commission before the end of 
the year.  Kinshak explained that the Intergovernmental 
Commission is the formal mechanism for addressing specific 
bilateral political and economic issues; Russian Industry and 
Energy Minister Khristenko and Zebari are the co-chairs of 
the Intergovernmental Commission.  According to Kinshak, the 
Intergovernmental Commission has not met since the invasion 
in Iraq because the new Iraqi government remains reluctant to 
resurrect the forum, claiming that it needs more time to 
consolidate its power.  If Zebari agrees to meet Khristenko, 
he will urge Zebari to view the Intergovernmental Commission 
as a useful format to help address the most pressing issues 
in Iraq, noting that Russia would be willing to restructure 
the forum.  Kinshak cited as an example GOR interest in 
increasing the number of GOI contracts to Russian companies 
to develop Iraq's electrical infrastructure.  Kinshak argued 
that Iraq is in desperate need of electricity and the 
Intergovernmental Commission could address that need quickly 
and systematically.  He emphasized that Russia would also 
seek to "integrate" Russia's pending oil contracts in the 
Intergovernmental Commission structure. 
 
...Iraqi Debt Reduction 
----------------------- 
 
¶5.  (C) Noting that Russia's Ministry of Finance has the lead 
on debt issues, Kinshak said that Russia and Iraq have 
already prepared the paperwork to write off almost 90 percent 
of Iraq's multibullion debt, which he pointed out is 10 
percent more than Paris Club requirements.  Kinshak said the 
remaining step is the signing of the agreement.  When pressed 
to offer a timeline on the signing, Kinshak recognized that 
the USG was "applying maximum pressure" on the GOR to 
conclude the agreement.  (Note: The Ambassador urged DFM 
Saltanov on August 30 to move quickly on debt reduction and 
 
MOSCOW 00004490  002 OF 002 
 
 
will reiterate this point in upcoming meetings with 
Presidential Aide Prikhodko and Finance Minister Kudrin.  See 
ref A.  End Note.)  However, he stated that Russia would most 
likely sign the agreement "as soon as Iraq addresses Russia's 
long-standing economic interests," which included agreeing to 
hold an Intergovernmental Commission meeting before the end 
of the year.  When we said that Russia could improve its 
dialogue with Iraq on pending oil contracts and other 
possible joint projects by concluding the debt reduction 
process, Kinshak repeated the familiar argument that Iraq 
could improve the atmosphere on debt reduction talks by 
recognizing Russian economic interests in Iraq. 
 
...Press and Business Roundtables 
--------------------------------- 
 
¶6.  (C) The MFA has asked Zebari about the possibility of 
conducting an in-depth press conference with Russian 
journalists and a roundtable with representatives of leading 
Russian businesses.  Kinshak also informed us that Zebari 
requested a meeting with Putin, but he doubted Zebari would 
receive a positive response from the Kremlin, noting that 
Iraq is not Russia's "number one priority." 
 
Lavrov Focused on Iraq Neighbors Ministerial 
-------------------------------------------- 
 
¶7.  (C) Kinshak said that FM Lavrov does not plan on 
attending the September 22 UNGA Ministerial on Iraq, given 
that "it will be nothing more than a talking heads show for 
two hours."  DFM Saltanov will represent the GOR at the UNGA 
Ministerial.  Noting the relatively successful September 9 
Expanded Neighbors preparatory conference, Kinshak confirmed 
that FM Lavrov will attend the October 31-November 1 
Neighbors Ministerial in Istanbul (ref B).  Kinshak 
underscored Russian commitment to the Neighbors framework, 
noting that such gatherings can play a significant role in 
helping the Iraqi government to establish peace and stability 
in the country. 
 
Comment 
------- 
¶8.  (C) The Ambassador will meet Zebari on September 19 and 
will review options to secure GOR debt relief now. 
Burns