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C O N F I D E N T I A L BELFAST 000021 
 
 
NOFORN 
 
EUR FOR WE; NSC FOR SHERWOOD-RANDALL 
 
E.O. 12958: DECL:  3/12/2019 
TAGS: PREL PGOV PTER ECON EINV UK EI
SUBJECT: SCENESETTER FOR ST PATRICK'S DAY VISIT BY NORTHERN IRELAND'S 
FIRST MINISTER AND DEPUTY FIRST MINISTER 
 
CLASSIFIED BY: Henry Bisharat, Acting Consul General , US 
Consulate Belfast. 
REASON: 1.4 (b), (d) 
 
¶1.   (C/NF) The visit to Washington by First Minister Peter 
Robinson and Deputy First Minister Martin McGuinness comes on 
the heels of recent attacks by dissident republicans which have 
left two soldiers and one police officer dead.  This visit will 
allow senior U.S. officials to express their sympathy and 
solidarity with Robinson and McGuinness and to publicly praise 
the people of Northern Ireland for the cross-community rejection 
of this recent violence.  It will also provide an opportunity to 
praise Robinson and McGuinnes for their work together in a 
power-sharing government and progress in moving towards 
devolution of policing and justice.  Both the Democratic 
Unionist Party (DUP) and Sinn Fein, as well as all the other 
main political parties, have appreciated the work of the several 
Special Envoys during the past decade and their help in moving 
the peace process forward.  We expect both the First Minister 
and Deputy First Minister to press for the naming of a new envoy 
to assist with remaining political issues, particularly 
devolution of policing, as well as to help promote U.S. 
investment.  Robinson and McGuinness planned to focus their 
visit to the U.S. on promoting investment.  However, the recent 
attacks have overshadowed their plans, and their departure for 
the U.S. was twice delayed due to the attacks.  Despite the 
global economic downtown, Northern Ireland officials believe 
their region remains an attractive base for U.S. investors due 
in part to its skilled workforce.  Northern Ireland's economy 
should fare better than the rest of the UK during the economic 
downturn.  The weak British pound has helped increase tourism 
and retail shopping, especially in border areas. 
 
Dissident Republic Activity 
--------------------------- 
 
¶2.  (C/NF) Northern Ireland's threat level was increased to 
"severe" from "substantial" in early March, just days before two 
soldiers and one police officer were killed by dissident 
republicans.  In the days before the attack, Chief Constable of 
Northern Ireland Sir Hugh Orde termed the threat posed by 
dissident republicans as the highest in his seven years on the 
job.  During the past year, dissident republicans primarily 
targeted police officers, in part because the new Police Service 
of Northern Ireland (PSNI) has been successful in attracting 
candidates from the nationalist community and become the public 
face of post-Good Friday Northern Ireland.  The discovery of a 
300-pound car bomb in January increased concerns and led 
directly to the increased threat level.  In order to enhance the 
police's ability to monitor dissident activities, Orde announced 
March 6 that he had requested the assistance of a small number 
of military intelligence specialists.  Due to inaccurate media 
reports of what this meant, Sinn Fein leaders protested 
strongly.  Sinn Fein does not like the publicity given to 
dissident threats and activities, as it implies they are unable 
to control their community.  That said, dissident groups are 
very small in number (probably no more than a few hundred, of 
which 60-80 are prepared to carry out attacks according to 
security sources in the UK media), have no significant political 
support, and are viewed as criminals within the Republican 
community.  On March 11, throughout Northern Ireland, thousands 
participated in silent protests against the killing of security 
personnel. 
 
¶3.  (C/NF) First Minister Robinson has received praise for his 
handling of the dissident attacks, particularly for his 
statesmanlike calls for loyalist paramilitaries not to commit 
retaliatory attacks.  While Sinn Fein was initially criticized 
for its delay in condemning the attack on soldiers (its first 
statement was not released until 14 hours the attacks), Deputy 
First Minister McGuinness drew universal praise for his actions 
in the aftermath of the policeman's shooting.  McGuinness, a 
former IRA leader, joined Robinson on March 10 in visiting the 
murdered policeman's widow and made a statement -- while 
standing alongside Robinson and Chief Constable Orde -- that 
those involved in the killing were "traitors to the Republican 
cause," a characterization which was unprecedented. 
McGuinness's statement also reflects the progress made by the 
Sinn Fein leadership in its commitment to support the PSNI. Sinn 
Fein only recognized the authority of the PSNI in January 2007. 
 
Policing and Justice Devolution 
------------------------------- 
 
¶4.  (C/NF) All governmental powers were devolved to Northern 
Ireland's power-sharing government on May 8, 2007, with the 
exception of powers related to policing and the administration 
of justice, which, under the St. Andrews Agreement, were to 
devolve to the Belfast government by May 2008.  When this date 
passed and little progress had been made on devolution, Sinn 
Fein became disillusioned because it felt that the DUP was not 
taking the necessary steps toward devolution of police and 
justice.  Starting in June 2008, Sinn Fein began to block 
meetings of the Northern Ireland Executive (cabinet) until it 
could reach an agreement with the DUP on steps allowing for 
devolution.  In November 2008, with support from the British, 
Irish and U.S. governments, the DUP and Sinn Fein agreed to 
complete the legislative steps necessary for devolution of 
policing and justice to take place in 2009.  PSNI Chief 
Constable Sir Hugh Orde has repeatedly stated the delay in 
devolution has created a vacuum that dissident republican groups 
have used to criticize Sinn Fein's leadership. The British 
government and the PSNI have been concerned that this vacuum 
would lead to violence against police officers and other 
government targets. The USG has been clear in its support for 
devolution and the need for all parties to carry out their 
commitments under the St. Andrews Agreement.  U.S. Special 
Envoys have played a crucial role in assisting with this 
process, and Robinson and McGuinness will seek assurances a new 
Special Envoy will be named.  The British and Irish governments 
will seek a commitment from the new U.S. administration of its 
continued support on this issue and will be keen to learn who 
the new Special Envoy will be. 
 
¶5.  (C/NF) Funding for policing and justice has been a key 
concern by both the DUP and Sinn Fein.  The view in Belfast is 
that recent dissident republican attacks will help move the 
process forward, especially if the British increase funding for 
security in Northern Ireland.  The British government has 
allocated funds to cover policing and justice functions in 
Northern Ireland through 2011, so it will be important for the 
British government to satisfy Northern Ireland's politicians 
that sufficient funds will be available after that.  The British 
Government and Sinn Fein are committed to ensuring devolution of 
policing and justice happens in 2009.  The DUP will be nervous 
about devolution being completed before the June EU elections 
(DUP is worried about how devolution will play with Unionist 
critics of power-sharing), so most observers believe devolution 
will happen sometime in the fall, possibly September. 
 
¶6.  (C/NF) Both the DUP and Sinn Fein are confident that the 
pending legislation concerning devolution will pass in the UK 
Parliament despite Alliance Party objections that the 
legislation allows the devolved Justice Minister to lose his 
position should he lose cross-community support (a Sinn Fein 
demand).  The Alliance Party, which is the main non-sectarian 
party in Northern Ireland, is likely to take the Justice 
portfolio once devolution occurs, and would like complete 
autonomy, something Sinn Fein is reluctant to allow.  The 
Alliance Party has no seats in the UK Parliament, but hopes its 
Liberal Democratic allies will help them get the legislation 
changed.  Neither the British government nor the DUP, which are 
sympathetic to Alliance concerns, are willing to delay or change 
the legislation to accommodate it, since doing so would upset 
Sinn Fein. 
 
Northern Ireland's Economy 
-------------------------- 
 
¶7.  (C/NF) The Northern Ireland economy should fare better than 
the rest of the UK during the economic downturn, according to a 
recent study.  According to the latest PricewaterhouseCoopers UK 
(PwC) and Northern Ireland Economic Outlook report, the Northern 
Ireland economy should decline by three percent compared to four 
percent in the rest of the UK.  PwC expects recovery to begin 
around the third quarter of 2010, with average growth for 2010 
slightly above zero.  At 5 percent, the level of unemployment in 
Northern Ireland is also the lowest of any region in the UK, 
which averages 6.3 percent.  Housing prices in Northern Ireland 
fell by 28 percent in 2008, but economists believe the fall in 
prices is about to end.  Northern Ireland's economy has also 
been helped by the weak British pound, which has boosted tourism 
and retail shopping, especially in border areas, by those from 
Ireland and other Eurozone economies. 
 
U.S. Economic Investment in Northern Ireland 
-------------------------------------------- 
 
¶8. (C/NF) Despite the economic downturn, Northern Ireland's 
leaders are still looking for outside investment as a peace 
dividend.  In addition to Washington, Robinson and McGuinness 
will visit California and New York as part of an effort to 
attract badly needed investment.  The May 2008 Investment 
Conference is still seen as a success for bringing over 80 U.S. 
businesses to Northern Ireland.  While no direct investments 
have yet resulted from the investmeQ conference, Invest NI had 
always said it would take time before outside investment was 
finalized.  Northern Ireland's leaders are still optimistic that 
outside investors will see the wisdom of placing operations in 
Northern Ireland, particularly due to its skilled workforce, 
common culture and proximity to the U.S. relative to other 
regions. 
 
 
BISHARAT