VZCZCXYZ0004
OO RUEHWEB

DE RUEHKG #0084/01 0221942
ZNR UUUUU ZZH
O 221938Z JAN 10
FM AMEMBASSY KINGSTON
TO RUEHC/SECSTATE WASHDC IMMEDIATE 0558
INFO EC CARICOM COLLECTIVE IMMEDIATE
RUEATRS/DEPT OF TREASURY WASHINGTON DC IMMEDIATE
RUEHLO/AMEMBASSY LONDON IMMEDIATE 0146
RUEHOT/AMEMBASSY OTTAWA IMMEDIATE
RUEHPU/AMEMBASSY PORT AU PRINCE

UNCLAS KINGSTON 000084 
 
SENSITIVE 
SIPDIS 
STATE FOR WHA/CAR (VDEPIRRO) (WSMITH) (JMACK-WILSON) 
WHA/EPSC (MROONEY) (FCORNEILLE) 
EEB/IFD/ODF (MSIEMER) 
EEB/ESC/IEC (GGRIFFIN) 
EEB/ESC/IEC/EPC (MMCMANUS) 
EEB/TRA (VLIMAYE-DAVIS) 
INR/RES (RWARNER) 
INR/I (SMCCORMICK) 
SANTO DOMINGO FOR FCS AND FAS 
TREASURY FOR ERIN NEPHEW 
EXPORT IMPORT BANK FOR ANNETTE MARESH 
USTDA FOR NATHAN YOUNG AND PATRICIA ARRIAGADA 
OPIC FOR ALISON GERMAK 
 
E.O. 12958: N/A 
TAGS: PGOV PREL ETRD ECON SNAR ASEC CJAN CVIS EAIR EFIN
EINV, ELAB, EMIN, PREF, EAID, AORC, SOCI, KCRM, KCOR, JM, XL, HA, DR 
SUBJECT: JAMAICA: A GOOD WEEK FOR GOLDING, BUT DAUNTING CHALLENGES 
REMAIN 
 
REF: 09 KINGSTON 1190; 09 KINGSTON 709; 09 KINGSTON 1050 
09 KINGSTON 1178; 09 KINGSTON 1188; KINGSTON 60 
 
Summary 
 
------------ 
 
¶1. (SBU) Prime Minister (PM) Bruce Golding and his Jamaica Labour 
Party (JLP)-led Government of Jamaica (GOJ) have enjoyed a 
much-needed string of policy successes in recent weeks: rapid 
progress on negotiations for an International Monetary Fund (IMF) 
Standby Agreement, initiation of a debt-exchange arrangement with 
domestic creditors, a potential breakthrough in the pending sale of 
Air Jamaica, to Caribbean Airlines, and an enhanced regional 
profile as a result of the January 12 earthquake in Haiti. 
Nevertheless, economic prospects for the coming year do not look 
favorable, while refusal to cooperate on two high profile U.S. 
extradition requests raise serious doubts as to the GOJ's 
commitment to tackling the island's skyrocketing crime rate.  End 
Summary. 
 
The Lost Year 
 
----------------- 
 
¶2. (SBU) The GOJ spent much of 2009 buffeted by fiscal crises, an 
exploding balance-of-payments deficit, labor unrest, spiraling 
crime, police violence, and political paralysis (Reftel A).  The PM 
has admitted that the JLP squandered the political capital it 
garnered on taking office in September 2007 and was late in 
recognizing the impact that the global economic crisis would have 
on Jamaica (Reftel B).  IMF and Air Jamaica negotiations routinely 
missed deadlines and dragged on interminably (Reftel C), fiscal 
reforms were proposed in Parliament only to be hastily withdrawn 
and reworked when opposition arose (Reftel D), and high profile 
U.S. extradition requests were delayed for months while GOJ 
attorneys raised a series of technical legal concerns (Reftel E). 
Periodically, the Office of the Prime Minister (OPM) would raise 
expectations that "tough decisions" would be forthcoming in a major 
policy speech, only to allow the opportunity to be squandered. 
Most troubling was the growing perception in civil society and the 
private sector that, after 18 years in opposition, the JLP weren't 
up to the job of governing the country and that PM Golding was too 
hesitant, indecisive, and consumed by policy details to effectively 
manage the GOJ. 
 
What A Difference A Week Makes! 
 
--------------------------------------------- - 
 
¶3. (SBU) As 2010 dawned, however, Golding and the JLP seemed to 
have acquired a new lease on life.  After months of negotiations 
and delay, the IMF staff announced on January 14 that a USD 1.25 
billion Standby Agreement is near conclusion with the GOJ (Septel), 
while a long-awaited deal to sell off the perennial loss-making Air 
Jamaica to Caribbean Airlines appeared imminent (Reftel F). 
Meanwhile, Golding's proposal to reduce the GOJ's interest payments 
through a debt exchange with Jamaica's major domestic holders of 
government bonds, unveiled in a national address on January 13, 
appears to have been accepted by major lenders and has been 
proceeding smoothly.  Although the economic outlook for the coming 
year remains dire, JLP Member of Parliament and Minister of 
Information Daryl Vaz told Emboff that he was hopeful these 
achievements would lay the foundation for long-term fiscal 
stability and growth. 
 
 
 
 
 
 
Astride The World Stage 
 
----------------------------- 
 
¶4. (SBU) In addition, the devastation and turmoil wrought by 
Haiti's January 12 earthquake have offered PM Golding an 
opportunity to divert public attention from Jamaica's myriad 
economic problems toward regional and international affairs. 
Within days of the quake, Golding and Vaz visited Port-au-Prince, 
where they met with, and offered assistance to, Haitian President 
Ren???? Pr????val, as well as Santo Domingo, where they participated in a regional meeting on plans for Haiti's recovery ((NOTE: In a rare instance of Jamaican bipartisanship, opposition People's National Party (PNP) President Portia Simpson Miller accompanied Golding and Vaz on the Port-au-Prince visit.  End Note)).  The GOJ also: deployed a fire brigade and Jamaican Defence Force (JDF) units to Port-au-Prince to assist in rescue efforts; offered the use of its airports in Kingston and Montego Bay for aircraft ferrying relief supplies; met with Caribbean Community (CARICOM) leaders to propose using the island as its hub of operations; and offered to 
temporarily house Haitian refugees until they could return home. 
(NOTE: The GOJ has requested U.S. financial assistance to fund 
these efforts.  Reftel F.  End Note). 
 
¶5. (SBU) On January 16, en route from Port-au-Prince back to 
Washington, the Secretary's plane landed briefly at Kingston's 
Norman Manley International Airport.  Golding and Foreign Minister 
Kenneth Baugh met for a short time with the Secretary in the 
airport's VIP lounge; Vaz told Emboff that the topics of discussion 
included relief efforts in Haiti and the pending IMF agreement, but 
that the high profile extradition cases were not raised.  On 
January 19, Golding announced that former PNP Prime Minister P.J. 
Patterson would serve as CARICOM's representative on a coordinating committee to organize an international conference to develop a strategic plan for Haiti's recovery and rebuilding. 
 
All That Glitters... 
 
--------------------- 
 
¶6. (SBU) Nevertheless, despite the recent positive press, serious 
issues continue to demand the GOJ's attention and to roil the 
bilateral relationship.  Unemployment remains high, consumer prices 
continue to increase, and the bauxite industry continues to show 
few signs of life (Reftel A).  The GOJ continues to trumpet its 
intention to bring down the island's spiraling crime rate, with 
Minister of National Security Dwight Nelson promising that 
"draconian" anti-gang measures to assist the Jamaican Constabulary 
Force (JCF) would soon be forthcoming.  However, Attorney General 
Dorothy Lightbourne's recent refusal to extradite Presley Bingham 
(Septel) and the ongoing standoff over the Christopher Coke 
extradition request raise doubts as to the GOJ's resolve, 
especially when it comes to high-profile criminal dons with close 
ties to the JLP. 
 
Summary and Analysis: 
 
----------------------------- 
 
¶7. (SBU) Having spent most of 2009 lambasted by critics as 
ineffective and indecisive, PM Golding and the GOJ now find 
themselves in an unfamiliar position - riding a wave of policy 
successes.  Meanwhile, the tragedy of the Haitian earthquake has 
offered the PM a rare opportunity to rise above the bitterness and 
rancor of party politics and to present himself as a regional 
statesman and humanitarian, shepherding CARICOM's relief efforts 
and working closely with the Secretary and the USG.  Nevertheless, 
it remains to be seen whether the GOJ will take advantage of these 
policy achievements to finally impose order on the nation's fiscal 
 affairs, draw down its crushing debt burden in order to free up 
resources for private investment, and rekindle economic growth. 
Perhaps more troubling is the GOJ's recent recalcitrance in 
granting U.S. extradition requests, suggesting a lack of 
seriousness in addressing Jamaica's crime problems, or even the 
possibility that garrison dons and criminal elements have 
"captured" the GOJ. 
 
MINIMIZE CONSIDERED 
Moss