VZCZCXYZ0008
PP RUEHWEB

DE RUEHRB #1895/01 3651216
ZNR UUUUU ZZH
P 311216Z DEC 07
FM AMEMBASSY RABAT
TO RUEHC/SECSTATE WASHDC PRIORITY 7953
INFO RUEHAS/AMEMBASSY ALGIERS 4622
RUEHAK/AMEMBASSY ANKARA 0208
RUEHMD/AMEMBASSY MADRID 5871
RUEHFR/AMEMBASSY PARIS 4881
RUEHPG/AMEMBASSY PRAGUE 0229
RUEHTU/AMEMBASSY TUNIS 9462

UNCLAS RABAT 001895 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
STATE FOR H AND NEA/MAG 
 
E.O. 12958: N/A 
TAGS: OREP EAID ECON PGOV PREL PTER MO
SUBJECT: SCENESETTER FOR CODEL MARTINEZ 
 
¶1.  (SBU) SUMMARY:  My staff and I are delighted to welcome you and 
your delegation to Morocco.  Your visit will help underscore the 
importance of our relations with Morocco.  Morocco is a paragon of 
reform in the region and relations are so strong that it has been 
designated a "major, non-NATO ally."  The country conducted 
parliamentary elections on September 7th, the second in King 
Mohammed VI's eight year reign and the first since 2002.  They were 
widely hailed as the most free and transparent in Morocco's history 
and were certified by a team of international observers under the 
auspices of the National Democratic Institute.  Morocco is also 
engaged in negotiations under U.N. auspices on the future of the 
Western Sahara, which we support.  It is also increasingly focused 
on the terrorist threat in North Africa and went on maximum alert 
against that threat earlier this summer.  END SUMMARY. 
 
¶2.  (U) WESTERN SAHARA:  Bilaterally, your visit comes on the eve of 
the third round of talks between Morocco and the POLISARIO under 
United Nations auspices.  The so-called Manhasset process represents 
an opportunity for the two parties to engage in a meaningfulQalogue that will hopefully lead to a resolution of the Western 
Sahara conflict. 
 
¶3.  (U) MILLENNIUM CHALLENGE ACCOUNT:  You are also visiting Morocco 
as the implementing legislation for the recently signed Millennium 
Challenge Account Compact is being finalized.  The Compact 
represents a significant expansion of U.S. assistance to Morocco, 
focused on key areas including agriculture, small-scale fisheries, 
artisan crafts, financial services and enterprise support.  This 
support will build on previous USAID successes in micro-credit and 
agriculture, but will also bring U.S. assistance into new areas. 
 
¶4.  (SBU) POLITICAL AND ECONOMIC REFORM:  Morocco has made 
impressive political and economic strides in recent years, including 
liberalization of its trade relations with the United States and 
other countries.  Our bilateral free trade agreement entered into 
force in January 2006, and brought a 44 percent increase in 
bilateral trade in its first year.  King Mohammed VI rules as well 
as reigns.  He has championed significant political reforms, 
including relative freedom of expression, advances on human rights, 
and the 2004 family law (or "moudawana"), which has significantly 
enhanced the rights of women.  Partly as a result of this reform 
record, the current form of government retains support across the 
political spectrum. 
 
¶5.  (SBU) CHALLENGES:  Nonetheless, Morocco continues to face 
serious challenges.  Illiteracy and joblessness remain high, and 
while economic growth has accelerated (averaging 5.4 percent from 
1999 to 2006), it has not yet achieved the level needed to absorb 
new entrants to the labor force or to reduce poverty.  Frustration 
over the lack of employment opportunities, the government's 
inability to respond fully to educational and health needs, and 
endemic corruption, have broadened the appeal of Islamic-oriented 
parties and non-governmental organizations. 
 
¶6.  (SBU) The September 7 elections, while representing significant 
progress in terms of governmental conduct of elections, highlighted 
a fundamental lack of popular confidence in the political system. 
Sixty three percent of registered voters did not vote.  Among the 37 
percent who did vote, approximately one fifth cast blank or spoiled 
protest ballots.  The nationalist Istiqlal party won less than a 
fifth of the votes, slightly ahead of the Islamist Party of Justice 
and Development, but emerged as the largest bloc in the new 
parliament.  The current government is made up of a minority 
coalition headed by Istiqlal Prime Minister Abbas El-Fassi. 
 
¶7.  (SBU) TERRORISM:  Popular frustrations, combined with satellite 
television from the rest of the Arab world, have strengthened a 
dangerous terrorist fringe, as reflected in the April bombings in 
Casablanca that targeted the U. S. Consulate and Cultural Center, 
among other targets.  In the face of this threat, U.S.-Moroccan 
counterterrorism cooperation has been excellent, as is reflected in 
the recent visits to Rabat of APHSCT Frances Townsend, FBI Director 
Mueller, and CIA Director Hayden.  The U.S. finds in Morocco a 
capable and active partner in the war against terror.  Morocco 
pursues an interdisciplinary approach in confronting the threat, 
seeking to address the economic marginalization of youth and refute 
extremist ideology by propagating Islamic messages of tolerance and 
moderation, while at the same time pursuing vigorous law enforcement 
and intelligence operations against specific terror cells.  It has 
acknowledged over the past year the importance of protecting human 
rights during the pursuit of counterterrorism efforts. 
 
¶8.  (SBU) Our Mission Strategic Plan also adopts this holistic 
approach, seeking on the one hand to sustain and expand 
counterterrorism efforts in Morocco through continued diplomatic, 
law enforcement and military cooperation, while on the other 
supporting the country's ongoing social, economic, and political 
reforms that directly address the conditions that create extremism. 
 
¶9.  (U) U.S. FOREIGN ASSISTANCE:  Morocco received over USD 35 
million in U.S. foreign assistance in FY07, approximately half of 
which will be for activities under peace and security with 
expenditures under IMET, INCLE, NADR and FMF.  USD 18.9 million will 
be spent to address Morocco's ongoing development challenges through 
USAID with programs in economic growth, education/workforce 
development and democracy/governance.  Additional funding from 
Washington of approximately USD 2 million annually is made available 
through the Middle East Partnership Initiative for advancing the 
Freedom Agenda and occasionally through other agencies, as well. 
 
¶10.  (U) The USD 700 million, five-year MCA Compact represents a 
significant increase in U.S. assistance that will potentially have a 
profound impact on Morocco's prospects for economic growth, 
especially in agriculture, fisheries and traditional crafts. 
However, Development Assistance (DA) and Economic Support Funds 
(ESF) are looked to in order to underwrite an assistance response 
that is complementary to the investment being made by the USG 
through the Millennium Challenge Corporation. 
 
¶11.  (U) That complementary assistance looks to the needs of the 
two-thirds of the 30 million Moroccans who are under age 30.  This 
population bulge, a result of rapid population growth in the 1970s 
and 1980s, has led to significant challenges. Joblessness, 
underemployment, poor education, and the inability of government to 
meet citizens' needs are sources of alienation, radicalization, and 
extremism that underpin a continuing terrorist threat. 
 
¶12.  (U) U.S. economic and development assistance is necessary to 
continue to focus on three priorities: education, economic growth, 
and democratic governance. U.S. assistance for peace and security 
should include FMF at adequate levels to sustain a large stock of 
U.S.-origin equipment while continuing strong military to military 
partnership with Morocco, a major non-NATO ally.  This will enhance 
the professionalism and skills of Moroccan military personnel, 
improve Morocco's ability to control its borders, and build upon the 
Moroccan military's contributions to international peacekeeping 
efforts and the global war on terror. 
 
RILEY