VZCZCXYZ0003
OO RUEHWEB

DE RUEHKA #0097/01 0260931
ZNR UUUUU ZZH
O 260931Z JAN 09
FM AMEMBASSY DHAKA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 8202
INFO RHHMUNA/USCINCPAC HONOLULU HI PRIORITY

UNCLAS DHAKA 000097 
 
SIPDIS 
 
DEPT PLEASE PASS USAID 
DEPT PLEASE PASS PEACE CORPS 
DEPT FOR SCA/PB, SCA/RA, AND SCA/FO 
 
E.O. 12958: N/A 
TAGS: EAID PGOV PREL KDEM BG
SUBJECT: INVESTING IN BANGLADESH'S DEMOCRATIC DEVELOPMENT 
 
SUMMARY 
-------- 
 
¶1. (U) Bangladesh's successful democratic transition 
following the December 29, 2008 parliamentary elections 
opened a new chapter in this country's history.  This 
exceptional moment also presents the United States and other 
development partners with an historic opportunity to help 
Bangladesh improve governance, foster economic development, 
and deny space to terrorist groups.  However, as the seventh 
most populous country in the world and the fourth largest 
Muslim-majority country, what happens in the electoral 
aftermath is just as important to Bangladesh and the United 
States as the successful return to democratically elected 
leadership.  Now is the time for the USG to strategically 
invest in democratic decentralization and promote good 
governance and public accountability.  Post strongly urges 
that the full $20.5 million planned Governance and Ruling 
Justly program funding be provided during FY 2009.  Anything 
less risks missing a once in a generation opportunity to 
effect lasting change in the country,s political landscape. 
 
FY-09 Request 
------------- 
 
¶2. (U) The January 6 swearing in of the new Awami League 
government represented the culmination of two years of 
intensive diplomatic activity and targeted development 
assistance resources that helped ensure free, fair, credible, 
and peaceful elections.  We now need to invest sufficient 
resources to consolidate the gains of the past two years and 
support efforts to fight corruption, strengthen parliament, 
reform political parties, promote democratic 
decentralization, and foster greater respect for human 
rights.  As Washington considers funding decisions for FY-09 
and beyond, we offer the following background and 
recommendations on our funding request. 
 
¶3. (U) The FY-09 planning budget for Bangladesh's Governing 
Justly and Democratically (GJD) program is $20,531,000. 
Additionally we have requested $1.1 million from the 
Transnational Crime program area for combating 
trafficking-in-persons.  FY-10 planning levels represent a 
modest increase to $23,762,000 for GJD programs and would be 
distributed proportionally in a similar manner.  It is 
critical that, at a minimum, post be allotted funding at the 
planning levels to assist Bangladesh at this seminal moment 
in its development.  At the $20.5 million level for GJD the 
Mission plans to engage in the following activities: 
 
Anti-Corruption Program 
----------------------- 
 
¶4. (U) At the FY-09 planned budget level no less than $6 
million for the Mission's flagship Anti-Corruption program 
($5M from 2.2.4 Anti-Corruption Program Element & $1M from 
2.4.2 Media Freedom Program Element).  Addressing corruption 
and strengthening civil society and media oversight of public 
spending remain top foreign assistance goals for Bangladesh. 
The new government has expressed interest in qualifying for 
MCC funding - a goal now within reach thanks to the success 
and momentum created by the Caretaker Government.  At the 
same time, corruption and poor governance remain key 
obstacles to development.  This program focuses on the 
national budgetary process by providing technical assistance 
and training to strengthen parliamentary oversight committees 
and establishing a Parliamentary Budget Analysis Unit; 
enhancing the capacity of the Office of the Comptroller and 
Auditor General; making more transparent the Ministry of 
Finance's development of the national budget; supporting 
citizen advocacy and watchdog initiatives; promoting legal 
reforms for greater access to reliable information; and 
strengthening investigative journalism and citizen 
participation in understanding and developing program-based 
budgets to serve as a check on the Government.  This 
initiative will help ensure effective stewardship of public 
resources by assisting in a more transparent development, 
review and implementation of the Government of Bangladesh's 
national budget. 
 
¶5. (U) Other donors provide support to the Anti-Corruption 
Commission, support the design and implementation of a public 
financial management system, and support research being done 
mostly through Transparency International Bangladesh. 
Currently, no donors other than the U.S. are focused on 
either the national budgetary process or investigative 
journalism.  Moreover, the USG has unique comparative 
advantage working on the accountability of public spending 
and the development of the national budget. 
 
Political Party and Legislative Strengthening 
--------------------------------------------- 
 
¶6. (U) FY-09 initial funding levels would allow for post to 
allocate $6 million for political party and legislative 
strengthening ($4.5M from 2.3.3 Political Parties & $1.5M 
from 2.2.1 Legislative Function).  Political party reform and 
democratization are integrally linked to strengthening the 
Parliamentary system.  Following the completion of the first 
national elections since 2001, there is widespread 
recognition of the need to reinvigorate political parties and 
restructure their internal organization to address changing 
political dynamics.  More than half the Members of Parliament 
(MPs) have been elected for the first time.  This opens a 
rare window of opportunity to assist and educate new MPs, 
form issue-based caucuses, improve the openness and public 
participation in the legislative process, strengthen the 
committee system and professionalize staffers.  By working 
jointly with political parties and parliament we hope to 
influence national leaders to focus on crucial national, 
regional and international issues. 
 
¶7. (U) Currently, other donors are neither supporting 
political party reform nor working directly with parties. 
While the Canadians and the United Nations Development 
Program (UNDP) have plans to work with the Parliament, they 
are far from implementation.  USAID is coordinating closely 
with them to avoid overlaps. 
 
Democratic Decentralization and Local Governance 
--------------------------------------------- --- 
 
¶8. (U) If FY-09 planned funding levels are provided, we will 
dedicate $5 million to promoting democratic decentralization 
and participatory local governance ($5M from 2.2.3 Local 
Government & Decentralization).  Bangladesh is one of the 
most centralized countries in the world.  As a result, abuses 
often go undetected and government lacks public 
accountability.  The overly centralized decision-making 
concentrates power in the hands of the few.  Upazila 
elections (county equivalents) took place on January 22 for 
the first time in almost 19 years, providing an alternative 
to top-down governance and development.  We need to seize 
this opportunity to work with the newly elected Upazila 
officials to help them implement the local government reforms 
begun by the caretaker government. 
 
¶9. (U) Additionally, USAID has been facilitating a national 
dialogue on decentralization, strengthening the management 
and planning capacity of local governments (at the municipal 
level equivalent), promoting citizen participation in local 
decision-making and oversight committees with greater success 
in the Southwest and Northwest.  Unfortunately this work has 
been almost eliminated due to FY 2008 budget constraints.  In 
addition to working with the newly formed Upazila 
administrations, we need to strengthen local-level service 
delivery.  We also seek to promote participatory planning and 
open public budget hearings at the lowest level of 
government, where most citizens interact with public 
officials.  Strengthening local government will help build as 
well as serve as a counterweight to the central government, 
and can establish trust and confidence in the democratic 
system. 
 
¶10. (U) The World Bank is providing a loan facility to the 
government for block grants to local governments.  The Swiss 
and others provide limited support for local governance 
activities.  USAID has signed a Memorandum of Understanding 
(MOU) with the Ministry of Local Governance which sets out a 
strategic approach for local government strengthening.  USAID 
continues some work with local governments in the Southwest 
as a part of Cyclone Sidr reconstruction. 
 
Leaders of Influence 
-------------------- 
 
¶11. (U) $1 million of critical FY-09 funding will be provided 
for Leaders of Influence ($1M from Civic Participation). 
Reaching out to leaders of influence, particularly religious 
leaders, has been an extremely useful approach to strengthen 
moderate voices and tolerance in Bangladeshi society.  The 
overall objective of this activity is to promote tolerance, 
diversity and social harmony and understanding by engaging 
and exposing Leaders of Influence to modern practices of 
development and democracy.  This program aims to enhance the 
commitment of a deeply religious population to the principles 
of development and democratic governance upon which 
Bangladesh's ambitious poverty reduction and economic 
 
development initiatives depend. 
 
¶12. (U) No other donor is working with outreach to leaders of 
influence or religious leaders except as related to 
sector-specific projects (e.g., a school management committee 
may involve community leaders). 
 
Human Rights 
------------ 
 
¶13. (U) A renewed initiative for FY-09 is to invest $2.5 
million for human rights ($2.5M from 2.1.4 Human Rights). 
Post has not had a human rights program since 2006 due to 
budget constraints. Domestic violence and respect for women's 
rights are ongoing priority issues that we should support. 
At least half of all Bangladeshi women experience some form 
of domestic violence, part of a vicious cycle passed from 
parents to children which can only be broken by education, 
advocacy and an enabling legal environment.  Respect for 
women's rights remains a challenge.  For example, the 
Caretaker Government encountered resistance when it attempted 
to implement a new women's development policy.  The USG is 
uniquely positioned to be able to influence these key basic 
human rights issues. 
 
¶14. (U) Some other donors, most notably the Scandinavian 
countries, are working on these issues, but in a disjointed 
and uneven way.  The USG could take an important leadership 
role to move these concerns higher up on the country's 
development agenda.  With funding, that could lead to a more 
coordinated and effective effort to strengthen respect for 
basic human rights. 
 
Opportunities That Could be Lost 
-------------------------------- 
 
¶15. (U) We understand there has been some discussion of 
"straight lining" our FY-09 Democracy and Governance request 
from the FY-08 budget (approximately $21 million was 
requested but only about $11 million was actually allocated). 
 This would be a huge mistake and lead not only to missed 
opportunities but also risk institutionalizing problems that 
would set Bangladesh back.  The first casualty of a 
straight-lined FY-09 D/G budget at $11 million would be the 
elimination of human rights and democratic 
decentralization/local governance programs.  We are required 
to honor on-going contractual commitments for anti-corruption 
and the leaders of influence projects.  The follow-on 
political party and legislative strengthening program would 
also be reduced.  Overall, a straight line budget would be 
allocated as follows: 
 
-- $6 million for anti-corruption: This remains the highest 
priority for both the USG and the Government of Bangladesh. 
 
-- $4 million for political party and legislative 
strengthening: We would be forced to scale back activities 
and would lose unprecedented opportunities to influence 
political party reforms. 
 
-- $0 for decentralization and local governance: Without 
additional funding, we could not begin a new activity to take 
advantage of the historic opportunity to work with newly 
elected sub-national governments and promote decentralization 
and citizen involvement in public decision-making. 
 
-- $1 million for leaders of influence: Encouraging 
tolerance, 
understanding and involvement of leaders, particularly 
religious leaders, must continue in an effort to strengthen 
moderate voices in society. 
 
-- $0 for human rights:  At lower funding levels, we would 
lack the necessary resources to help improve the rights of 
citizens in the fourth largest Muslim-majority country in the 
world. 
 
Comment 
------- 
 
¶16. (U) This is a historic moment for Bangladesh that 
provides an opportunity to address lingering governance 
deficits which have plagued the country since its birth in 
¶1971.  This window of opportunity comes at a time when the 
U.S. has identified Bangladesh as strategically important in 
a number of global efforts - climate change mitigation and 
the war on terror, to name just two.  In this grindingly poor 
Muslim-majority nation our goals of supporting development, 
democracy, and the denial of space to terrorism are 
intertwined.  The newly installed government is pro-U.S., and 
we have a chance to make sure Bangladesh remains on the right 
track.  It is imperative that our programs reflect this 
message with sufficient resources overall and for Democracy 
and Governance programs in particular.  If we miss the chance 
now the cost of future democracy-related investments will 
inevitability be higher and potentially less successful. 
MORIARTY