VZCZCXRO5124
PP RUEHLMC
DE RUEHDR #0104/01 0421853
ZNR UUUUU ZZH
P 111853Z FEB 08
FM AMEMBASSY DAR ES SALAAM
TO RUEHC/SECSTATE WASHDC PRIORITY 7305
INFO RUEKJCS/SECDEF WASHDC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RUEHLMC/MCC WASHINGTON DC PRIORITY

UNCLAS SECTION 01 OF 05 DAR ES SALAAM 000104 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT AF/E FOR JLIDDLE; AF/RSA FOR MBITTRICK 
PASS TO NSC 
PASS TO MCC WASHINGTON 
 
E.O. 12958: N/A 
TAGS: OVIP PREL PGOV EAID ECON TZ
SUBJECT: SCENESETTER FOR PRESIDENT BUSH'S FEBRUARY 2008 
TRIP TO TANZANIA 
 
REF: DAR ES SALAAM 098 
 
SUMMARY 
------- 
¶1. (SBU) Over the past two years, the U.S.-Tanzanian 
bilateral relationship has witnessed a sea change.  With the 
election of a charismatic, pro-Western President, and 
increasing levels of U.S. assistance, cooperation has 
expanded in areas ranging from health and education to 
counterterrorism and military affairs.  As a nascent 
democracy with an impressive record of peaceful political 
transition, Tanzania is an anchor of stability in a turbulent 
region.  Despite daunting challenges--HIV/AIDS, poor 
infrastructure, corruption, and political stalemate in 
Zanzibar--the Government of Tanzania (GOT) is clearly 
committed to furthering both economic development and 
democracy.  Providing more than USD 400 million in direct 
bilateral assistance to the GOT in FY 2008, the Mission aims 
to advance several strategic priorities such as enhancing 
Tanzania's counterterrorism capability and strengthening the 
checks and balances of Tanzania's democracy.  A USD 698 
million MCC Compact, the largest Compact to date, is 
scheduled to be signed during the POTUS' visit to Tanzania. 
 
¶2. (SBU) On anti-corruption and transparency, President 
Kikwete, well aware of the importance of government 
accountability to 82 percent of the electorate who brought 
him into office and to the donors, allowed press freedoms to 
strengthen, particularly investigative reporting.  During the 
second year of his administration, one corruption case after 
another was aired in the press.  Some major donors even 
threatened to reduce "medium term" assistance levels without 
greater transparency and accountability.  Although in early 
2007, Kikwete appeared not to be taking decisive action to 
ensure accountability, shortly after his party's (CCM) annual 
convention in November 2007, his actions become more evident. 
 President Kikwete fired at least one high level government 
official on allegations of corruption--the Governor of the 
Bank of Tanzania.  In addition, President Kikwete appointed a 
multi-party committee to investigate mining contracts to 
ascertain if any procurement rules had been breached. 
 
¶3. (SBU) Things came to a head on February 7 when the 
findings of a Parliamentary Committee formed to review a 
certain government contract were released to the public.  In 
response to the report, the Prime Minister promptly tendered 
his resignation and President Kikwete dissolved his entire 
cabinet.  On February 8 he appointed as the new PM an 
official known for his hard work and integrity (reftel).  In 
the remainder of his cabinet nominations, he has an 
opportunity to show whether he is serious to eliminate 
corruption at the senior levels of his government.  As of the 
date of this scenesetter, there is tremendous hope and 
anticipation in the press and with the people that President 
Kikwete will keep on the reform path by appointing a 
reform-minded cabinet and taking other public steps.  End 
Summary. 
 
Political and Economic Background 
--------------------------------- 
¶4. (SBU) In 1992, Tanzania opened the door to multi-party 
democracy, transitioning from a single party, socialist 
state.  Under the stewardship of former President Mkapa, 
fundamental macro-reforms were introduced and Tanzania began 
its transition toward free-market capitalism.  With the 
landslide election of President Kikwete in 2005, Tanzania 
underwent its third peaceful transition to a new President. 
Taken together, political and economic reforms introduced 
since 1992 have made Tanzania an example of peace and 
stability in the region. 
 
¶5. (SBU) Formidable challenges remain.  Located in a 
turbulent neighborhood, Tanzania has eight porous borders and 
a 1,500 kilometer coastline.  Infrastructure remains 
rudimentary, red tape and corruption impede private sector 
development, and HIV/AIDs prevalence hovers around seven 
percent.  While elections on the Mainland have been free and 
fair, Tanzania is still a state dominated by the executive 
branch and the ruling Chama Cha Mapinduzi (CCM) party.  In 
Zanzibar, serious irregularities and sporadic violence marred 
elections in 1995, 2000, and 2005. 
 
¶6. (SBU) While Tanzania has achieved major macro-economic 
reform over the past decade, macro stability has yet to 
 
DAR ES SAL 00000104  002 OF 005 
 
 
translate into significant gains at the micro level.  More 
than one third of Tanzanians live in abject poverty and per 
capita GDP is USD 340. In 2006, the Tanzanian government had 
to revise its growth forecasts downward (from 7.2 to 5.8 
percent) due to a food shortage and an ongoing power crisis. 
The lack of electricity, coupled with rising oil and food 
prices, caused inflation to increase from approximately 4 to 
7 percent.  Tanzania's oil import bill quadrupled and its 
business climate suffered set backs.  In 2007, with good 
rains and new leadership in the energy sector, the economic 
forecast rebounded to a growth rate of nearly 7.2 percent for 
¶2007. 
 
U.S.-Tanzanian Bilateral Relationship 
------------------------------------- 
¶7. (SBU) With the election of President Kikwete in December 
2005, U.S.-Tanzanian bilateral relations have warmed 
significantly.  President Kikwete's pro-Western stance, 
coupled with an increasing level of U.S. assistance, has been 
the catalyst for this change, enhancing cooperation in 
sectors from health and education, to counterterrorism and 
military affairs. President Kikwete has visited the U.S. four 
times since taking office, meeting President Bush in 
Washington D.C. (May 2006) and in New York (September 2006). 
In September 2007, President Kikwete attended the UN General 
Assembly in New York and met with the Secretary of State in 
Washington D.C.; in December 2007 he traveled to Washington 
to receive an award from the Leon Sullivan Foundation. 
 
¶8. (SBU) As a member of the UN Security Council (January 
2005-December 2006), Tanzania supported key resolutions 
sanctioning North Korea and Iran.  Tanzania did not fully 
support the USG's effort to address Burma's human rights 
situation in the Security Council, insisting the issue be 
dealt with in the Human Rights Council instead.  With respect 
to country specific human rights resolutions in the Third 
Committee, Tanzania was also not completely cooperative and 
abstained from votes or voted to close the discussion on some 
key human rights resolutions which the GOT believed should be 
handled by the Human Rights Council. 
 
¶9. (SBU) Tanzania has started to play an increasingly 
prominent role in the region on issues ranging from Sudan to 
Somalia.  Standing up to Sudan, the Kikwete administration 
was outspoken in its support of a UN peacekeeping mission to 
take over the African Union (AU) mission in Darfur and 
against Sudan assuming the AU Chairmanship in January 2007. 
During the January 2008 AU Summit in Addis Ababa, President 
Kikwete was elected AU Chairman for the next 12 months. 
While still in Addis, he worked to garner Africa's support 
for a strong Security Council statement against the 
deteriorating situation in Chad.  Over the next year, Kikwete 
will be playing a pivotal role to resolve conflicts on the 
Continent from Kenya, to Darfur and Chad, to Zimbabwe. 
 
¶10. (SBU) President Kikwete pledged to the Secretary of State 
in September 2007 to send three peacekeeping battalions to 
Darfur; these troops are presently being trained under the 
Department of State's ACOTA program.  Tanzania has also been 
supportive of our policy in Somalia and joined the Somalia 
Contact Group.  At the United States' behest, President 
Kikwete swiftly voiced his support for Ethiopia, the need for 
an African peacekeeping mission to be put in place, and 
offered to train 1,000 Somali troops to help stabilize the 
situation.  Tanzania has long played a constructive role in 
the Burundi peace process and a lead role within SADC on 
Zimbabwe. 
 
Strategic Priorities 
-------------------- 
¶11. (SBU) The Mission's strategic priorities in Tanzania are: 
 (i) building the GOT's counterterrorism (CT) capacity, with 
specific focus on establishing a national CT Center; (ii) 
improving health and education by combating HIV/AIDS and 
malaria, and increasing access to school for underserved 
children such as Muslim girls; (iii) strengthening Tanzania's 
nascent democracy and anti-corruption efforts; (iv) promoting 
regional stability by developing Tanzania's peacekeeping 
capability and deepening military-to-military ties; (v) 
spurring economic growth through policy reform and improved 
natural resource management; and (vi) influencing public 
opinion especially among Tanzania's Muslims who tend to view 
U.S. policy as anti-Islam 
 
 
DAR ES SAL 00000104  003 OF 005 
 
 
¶12. (SBU) We support these strategic priorities with active 
diplomatic engagement and a generous foreign assistance 
program.  Although Tanzania enjoys the support of numerous 
donor countries, the U.S. is one of the top donors in 
Tanzania in dollar amounts.  In FY08, the total USG bilateral 
assistance will amount to nearly USD 400 million including 
presidential initiatives such as PEPFAR and PMI.  Taking into 
account the U.S. share of contributions from multilateral 
donors such as the World Bank and African Development Bank, 
U.S. assistance will total USD 662 million in 2008.  This 
does not include major private U.S. benefactors such as the 
Gates Foundation.  Other major bilateral donors include the 
U.K., Norway, Sweden, and the European Union. 
 
¶13. (SBU) To ensure that corruption does not undermine 
development efforts, the Mission is sharply focused on 
supporting President Kikwete's anti-corruption campaign.  The 
Kikwete administration has taken steps to combat corruption, 
appointing a new Director General of the Prevention and 
Combating of Corruption Bureau (PCCB) and passing two new 
pieces of legislation: the Anti-Money Laundering Bill and the 
Anti-Corruption Bill.  While pleased with passage of these 
bills, we are disappointed that the Anti-Corruption Bill does 
not adequately safeguard the independence of the PCCB.  A 
steady drum beat of corruption allegations featured in the 
press over the past year have involved many of Tanzania's 
senior leaders; until now, no one had been brought to justice 
for their alleged actions.  However, with respect to the Bank 
of Tanzania, President Kikwete fired the Governor in January 
2008, and announced an investigation of the central bank's 
activities with the report due in six months.  President 
Kikwete's willingness to take actions, including criminal, 
against alleged corrupt officials will go a long way in 
determining how serious he is. 
 
¶14. (SBU) In the wake of the 1998 Embassy bombing, the 
Mission is actively engaged in furthering counterterrorism 
(CT) cooperation with the Tanzanian government.  The Mission 
has an integrated strategy involving modernization of 
Tanzania's law enforcement as well as winning the hearts and 
minds of the Tanzanian people.  Our work in Pemba--a Muslim 
enclave along the Swahili coast--exemplifies this strategy. 
We have knit together cultural preservation projects to 
repair mosques, self-help projects to improve rural 
livelihoods, and small USAID projects including the donation 
of generators to provide electricity to two hospitals.  In 
addition, CDC is providing HIV prevention and treatment 
services at the central hospital in Pemba.  USAID and the 
Combined Joint Task Force-Horn of Africa (CJTF-HOA) have 
partnered to build and furnish a primary school and the 
Mission has plans to inaugurate an American Corner in Pemba 
to advance Islamic outreach efforts.  Another key component 
of the Mission's strategy is helping the government establish 
its own national, interagency CT Center to collect, share and 
analyze CT data. 
 
Zanzibar's "Political Problem" 
----------------------------- 
¶15. (SBU) In his December 2005 inaugural address, President 
Kikwete pledged to address Zanzibar's "political problem," 
which involves the bitter divide between two political 
parties - CCM and the Civic United Front (CUF)- and between 
Zanzibar's two islands--Unguja and Pemba.  Like the 1995 and 
2000 elections, Zanzibar's 2005 elections were marred by 
irregularities.  A National Democratic Institute observer 
team reported "serious problems in Zanzibar's urban region 
where 40 percent of the registered voters reside."  However, 
2005 did register important administrative improvements and 
violence was contained. Nevertheless, the elections ended in 
an impasse: CCM claimed victory (53 percent of the vote) and 
CUF contested the elections and refused to recognize 
President Karume's government. 
 
¶16. (SBU) Throughout 2006, neither party made any formal 
reconciliation attempt.  Among CUF members, there appeared to 
be disagreement between older members urging patience and 
time for President Kikwete to address the problem, and the 
CUF youth wing which was increasingly frustrated and 
impatient.  Within CCM there also appeared to be a divide 
between moderates recognizing that there was a problem in 
Zanzibar and more hard-line members, including President 
Karume, denying that any real problem existed. 
 
¶17. (SBU) In January 2007, following up on his inauguration 
 
DAR ES SAL 00000104  004 OF 005 
 
 
promise, President Kikwete obtained CCM Central Committee "go 
ahead" to begin official reconciliation talks between the CCM 
Secretary General, Yusuf Makamba, and CUF's Secretary General 
 
SIPDIS 
and three-time presidential candidate, Maalim Seif Hamad.  In 
December 2007 these negotiations reached a critical stage 
after 12 months of discussions.  The CUF is still stressing 
their bottom line is the formation of a government of 
national unity in advance of the 2010 elections.  CCM, on the 
other hand, appears unwilling to implement a power sharing 
agreement prior to the 2010 elections.  CUF leaders have 
repeatedly emphasized that without a government of national 
unity, the 2010 elections will be neither free nor fair and 
have warned that their membership is becoming increasingly 
restless and disillusioned with the democratic process. 
President Kikwete is personally involved in monitoring the 
final stages of these discussions.  Particularly in light of 
the ongoing political crisis in Kenya, we believe he realizes 
keenly the necessity that the final agreement be fair and 
equitable to both sides. 
 
Military-to-Military Relations 
------------------------------ 
¶18. (SBU) Under the Kikwete administration, the GOT has 
expressed its intent to begin participating in international 
peacekeeping operations.  In 2006, Tanzania became our newest 
partner in the African Contingency Training and Assistance 
(ACOTA) program.  With Kikwete's offer to deploy a 
peacekeeping brigade to Darfur under UN auspices, the 
Mission's goal is to train three Tanzanian battalions by 
¶2009.  These battalions will not only contribute to UN 
deployments but constitute part of an AU regional standby 
brigade.  (Note: Demonstrating its intent to become more 
active in peacekeeping, Tanzania deployed 75 military police 
to Lebanon in January 2007 to help secure the UNAFIL mission.) 
 
¶19. (SBU) The Tanzanian government has also signaled its 
desire to deepen military-to-military ties with the U.S. more 
broadly.  In December 2006, the GOT gave approval to CJTF-HOA 
to establish a Civil Affairs presence on the Swahili Coast. 
The Civil Affairs team is carrying out humanitarian projects 
and helping build civil military operations capacity within 
the Tanzania People's Defence Forces (TPDF).  Among some 
members of TPDF's old guard, however, there remains a 
residual resistance to developing deeper ties with the U.S. 
 
¶20. (SBU) The Tanzanian government has repeatedly requested 
military equipment from the U.S. but its failure to sign 
Article 98 is an impediment.  To respond to the GOT's 
requests for increased training opportunities, the Mission 
will use IMET funds to send promising officers from 
Tanzania's army and navy to the U.S. for educational exchange 
programs.  We also used funds from a State Department source 
(NADR-EXBS) to provide equipment to Tanzanian coastal 
security forces to strengthen the country's maritime security 
capacity.  Finally, using DoD Section 1206 funding, we 
provided nearly USD 1 million in FY07 to train Tanzania's 
military in Special Forces Operations with an emphasis on 
patrolling the country's borders. 
 
Health Challenges: HIV/AIDS and Malaria 
--------------------------------------- 
¶21. (SBU) Tanzania faces a mature generalized HIV epidemic, 
with a prevalence rate of approximately 7 percent and 1.4 
million people living with HIV/AIDS.  In FY 2008, PEPFAR will 
provide Tanzania with over USD 300 million to support 
treatment, care, and prevention programs.  The PEPFAR program 
is on track to exceed its original targets: 150,000 
individuals on anti-retroviral drugs; care for 750,000 
individuals, including orphans and vulnerable children; and 
prevention of 490,000 new HIV infections.  Although the U.S. 
has fostered positive relationships with the Tanzanian 
government in the health sector, significant challenges 
remain including: poor health infrastructure; a shortage of 
health care workers; a weak procurement system; and 
occasional allegations of corruption. 
 
¶22. (SBU) Malaria is the number one killer of children in 
Tanzania and continues to be a major cause of maternal 
mortality.  As a focus country under the President's Malaria 
Initiative (PMI), Tanzania will receive up to USD 34 million 
in FY08 to support the delivery of long-lasting, insecticide 
treated bed-nets, the care and treatment of malaria, the 
malaria in pregnancy program, and indoor residual insecticide 
spraying.  Since 2006, USAID has focused its efforts in 
 
DAR ES SAL 00000104  005 OF 005 
 
 
Zanzibar, successfully controlling malaria on both islands; 
the program on the Mainland is on track to attain the PMI 
goal of reducing malaria deaths by at least 50 percent by 
¶2010. 
 
Millennium Challenge Corporation (MCC) 
-------------------------------------- 
¶23. (SBU) In September 2007, the MCC Board approved Tanzania 
for the largest MCC Compact to date, USD 698 million.  The 
Compact will strengthen Tanzania's infrastructure network in 
three key areas: roads, water, and energy.  Tanzania's MCC 
Compact is scheduled to be signed in Dar es Salaam by the two 
presidents during the POTUS' visit.  Even after the Compact 
signing, our message will continue to be that a Compact is an 
agreement of reciprocal responsibilities, and to sustain it 
over five years, Tanzania must pay heed to its corruption 
index and be vigilant at all levels to ensure transparency 
and accountability in governance. 
 
¶24. (SBU) Tanzania also received MCC Threshold funds ) USD 
11.2 million from FY05-07.  The Threshold program, which 
focuses on good governance and anti-corruption projects, 
consists of four components: (i) public procurement reform; 
(ii) a rule of law initiative with focus on the Prevention of 
Corruption Bureau; (iii) civil society strengthening; and 
(iv) technical assistance to establish a Financial 
Intelligence Unit. 
 
Comment 
------- 
¶25. (SBU) The President's visit comes at a time when the U.S. 
is providing unprecedented support to Tanzania and when there 
is a great deal of positive momentum in the U.S.-Tanzanian 
bilateral relationship.  President Kikwete's new position as 
the African Union Chairman is key to our regional and 
Africa-wide objectives.  While this visit will accentuate the 
positive, we hope to underline the critical importance of 
continuing to ask for transparency and accountability in 
government.  At this moment, Tanzania is clearly poised to be 
a model of stability, enjoying peaceful transitions of power, 
and promising economic growth.  However, President Kikwete is 
in the immediate wake of a major cabinet change precipitated 
by the legislative branch taking a stronger role as the watch 
dog of the executive branch.  Because of recent events, there 
is a great opportunity for President Kikwete to dramatically 
take a stand against corruption in favor of transparency.  In 
our view, the signs are good, but the proof will be in the 
steps he will take. 
GREEN