VZCZCXYZ0002
RR RUEHWEB

DE RUEHAM #0323/01 0351611
ZNR UUUUU ZZH
R 041611Z FEB 10
FM AMEMBASSY AMMAN
TO RUEHC/SECSTATE WASHDC 6852
INFO RUEHEG/AMEMBASSY CAIRO 0031
RUEHTV/AMEMBASSY TEL AVIV 2028
RUEHJM/AMCONSUL JERUSALEM 5782

UNCLAS AMMAN 000323 
 
SENSITIVE 
SIPDIS 
 
STATE FOR NEA/ELA 
 
E.O. 12958: N/A 
TAGS: PGOV PREL ECON EAID JO
SUBJECT: JORDAN SCENESETTER FOR DEPUTY SECRETARY LEW 
 
REF: A. AMMAN 320 
     ¶B. AMMAN 310 
     ¶C. AMMAN 307 
     ¶D. AMMAN 219 
     ¶E. AMMAN 218 
     ¶F. AMMAN 092 
     ¶G. 09 AMMAN 2804 
 
¶1. (SBU) Summary:  Embassy Amman warmly welcomes your visit, 
which will allow us to engage the Government of Jordan (GOJ) 
at the highest levels.  We have requested an audience with 
King Abdullah and confirmed meetings with the Foreign 
Minister and Minister of Planning and International 
Cooperation.  The end of 2009 was marked with a flurry of 
political changes in Jordan, with the King dissolving the 
parliament in November.  Separately, he dismissed the cabinet 
and named a new Prime Minister, who formed a new cabinet, in 
December.  The new cabinet, in accordance with the 
constitution, has begun issuing "temporary" laws in the 
absence of parliament, as a way to move its agenda forward 
until parliamentary elections, scheduled to take place during 
the fourth quarter of 2010, occur.  Regional tensions 
continue to capture the attention of the Jordanian 
leadership, particularly the stalled peace negotiations 
between the Palestinians and Israelis and the situation 
regarding Iran's nuclear program, two issues seen as linked 
by Jordanian interlocutors.  In addition to domestic and 
regional security concerns, Jordan's leadership is 
preoccupied with managing a tight budgetary situation.  The 
2010 Jordanian budget includes $7.7 billion in expenditures, 
a $1.43 billion deficit before grants, and 20% cuts in 
capital expenditures.  As a result, GOJ agencies are 
curtailing spending and seeking additional financial and 
technical assistance from the USG and others.  In terms of 
post management issues, we continue to focus on security and 
space.  End summary. 
 
Political Changes 
----------------- 
 
¶2. (SBU) The King constitutionally dissolved the Parliament 
in late November 2009.  The parliament was widely perceived 
as ineffective.  Cooperation between the then-cabinet and 
parliament had deteriorated to such an extent that only a 
minimal amount of legislation was offered for parliamentary 
consideration, most of which was stymied or, if approved, 
mangled in the process, according to parliamentary observers. 
 
 
¶3. (SBU) Following the King's dissolution of the parliament, 
he exercised a constitutional clause which allowed him to 
extend the normal constitutionally required four-month window 
for new elections.  Palace statements indicated that this was 
done to reform the election law in order to improve a process 
which was strongly criticized domestically for favoring 
rural, East Bank communities over urban communities with 
large Palestinian-origin populations during the 2007 
election.  The King has established a ministerial-level 
committee to consider electoral law reforms and announced 
that parliamentary elections will be held in the last quarter 
of 2010. 
 
¶4. (SBU) In early December, the King accepted the resignation 
of then-Prime Minister Nader Dahabi and appointed to replace 
him entrepreneur Samir al-Rifa'i, who is a former official 
and advisor to the King in the Royal Court, Foreign Minister 
Judeh's cousin, and the son of former Prime Minister and 
Upper House Speaker Zayd al-Rifa'i.  In his designation 
letter to Rifa'i, the King emphasized, among various reform 
efforts, the need to fight corruption. 
 
¶5. (SBU) Along with the new Prime Minister, a new 29-member 
cabinet was named and officially sworn in on December 14. 
Local commentators note a lack of new faces in the cabinet, 
with 13 returning ministers and seven who served in previous 
governments (ref G).  Analysts believe that the government, 
as a whole, will ultimately turn out to be conservative 
rather than reform-oriented in its decision-making.  In the 
absence of a sitting parliament, the new government has begun 
to pass so-called "temporary laws" or legislation enacted 
without parliamentary approval, which will theoretically be 
subject to parliamentary re-evaluation once new members are 
elected and seated.  Some commentators see this as a way for 
the government to pass legislation which otherwise would not 
have made it through a sitting parliament.  For example, much 
needed tax reform laws, which the previous parliament 
opposed, were recently enacted as well as a law on renewable 
energy (ref E). 
 
Foreign Policy 
-------------- 
 
¶6. (SBU) During your visit, you will hear from GOJ 
interlocutors their concern on the lack of progress in Middle 
East Peace negotiations.  King Abdullah has said publicly 
that the lack of progress is the greatest threat to stability 
in the region and hurts U.S. credibility in the region.  King 
Abdullah further asserts that the lack of meaningful progress 
hurts the ability of the United States to advance its 
interests on multiple issues in the region, including on 
Iran.  Jordan also considers settlement activities, home 
demolitions, and evictions in Jerusalem to be particularly 
destabilizing and unhelpful in restarting negotiations.  The 
King has a keen interest in preserving Jordan's role in 
administering the Haram al-Sharif/Temple Mount complex in 
Jerusalem and in overseeing other Islamic and Christian holy 
sites in Jerusalem. 
 
¶7. (SBU) The King remains a resolute advocate of a two-state 
solution and has responded positively to his engagements with 
SEMEP Mitchell.  Jordanian officials consistently express 
concern that Jordan will be asked to assume some form of 
responsibility for the West Bank, a proposition that King 
Abdullah consistently resists, as does an overwhelming 
percentage of the Jordanian public.  Many Jordanians 
currently believe that Israel is unwilling to move forward on 
peace negotiations. 
 
¶8. (SBU) Jordan has expressed concerns regarding Iran's 
nuclear program (ref B).  Some Jordanians link Iran to 
regional instability and terrorist organizations Hamas and 
Hizbollah and argue that regional consensus on Iran depends 
on meaningful movement on Palestinian-Israeli peace 
negotiations. 
 
¶9. (SBU) Jordan plays a positive role in regional security 
efforts, including in Iraq and Afghanistan.  Jordan supports 
a conditional U.S. withdrawal from Iraq that prevents chaos 
in Iraq, which would impact Jordan, and which limits the 
Iranian influence there.  Despite local press reporting on 
Jordan's role in Afghanistan, Jordan will continue its 
security cooperation in Afghanistan.  During your meetings 
here, officials will likely raise, as they recently did in 
Washington, the issue of Jordan providing further support in 
Afghanistan in exchange for additional economic assistance 
through an anticipated Afghanistan supplemental appropriation 
(ref D). 
 
¶10. (SBU) Jordan hosts numerous Iraqis who have fled the 
conflict and its after-effects and has provided them with 
access to some social services.  The GOJ does not formally 
classify the Iraqis as refugees, because of concerns that a 
new permanent refugee populace in Jordan, in addition to the 
already sizable Palestinian refugee population, would further 
erode the demographic position of East Bankers.  The GOJ 
emphasizes that hosting the Iraqis has been a burden on the 
budget, and Jordan has received international aid to ease 
their already tight fiscal situation.  Jordanian officials 
have previously placed the number of Iraqi refugees between 
450,000 and 500,000, but have now backed away from specific 
numbers of late in the face of estimates from most 
international organizations and NGOs working with the 
refugees that are significantly lower, perhaps in the 100,000 
to 200,000 range.  The real numbers are uncertain in the 
absence of a needs assessment study on Iraqis in Jordan, 
which the U.S. and others have been urging. Displaced Iraqis 
in Jordan are integrated and live within Jordanian 
communities, not in refugee camps. 
 
Budget Challenges and Impact on USG 
----------------------------------- 
 
¶11. (SBU) Your visit also comes as Jordan faces a difficult 
budget environment (ref A).  The 2010 budget includes $6.74 
billion in projected revenues and $7.71 billion in 
expenditures and has a $1.4 billion deficit before grants, 
which is 5.8% of Jordan's GDP (estimated at $24.7 billion for 
2010),  The 2010 budget features 20% cuts to capital 
expenditures and 1.4% cuts to current expenditures and will 
impact GOJ agencies by curtailing their ability to hire new 
employees and forcing additional cuts in overtime, official 
travel, and purchases of vehicles and furniture.  Existing 
reform and development projects requiring new staff and/or 
construction will also face financial constraints.  Weak 
growth in 2009 will translate to lower income and sales tax 
revenues this year (taxes on 2009 income will be paid in 
2010).  This along with a downward trend for the collection 
of land sales and other fees by the GOJ in 2010 portends an 
even more precarious budget situation during the second half 
of 2010.  This budget environment has already resulted in 
additional requests from the GOJ for financial and technical 
assistance. 
 
Assistance MOU 
-------------- 
 
¶12. (SBU) On September 22, 2008, Jordan and the U.S. signed a 
memorandum of understanding (MOU) related to development, 
economic, and military assistance.  The agreement laid out a 
five-year non-binding annual commitment of economic support 
funds (ESF) ($360 million) and foreign military funds (FMF) 
($300 million).  (Note:  The FY 2011 OMB budget submission 
includes $360 million in ESF and $300 million in FMF for 
Jordan.  End note.)  In turn, a side letter spelled out the 
joint intent to expand cooperation in the political and 
economic arenas.  The side letter draws on the 2006 Jordanian 
"National Agenda" reform plan and identifies areas of mutual 
cooperation to be discussed in separate economic and 
political bilateral dialogues.  A bilateral political 
dialogue meeting focused on equality for women under the law, 
media freedom, religious tolerance and freedom, prison 
conditions and inmate treatment, good governance, and a 
strong civil society was held in Amman in January 2010 with 
DRL A/S Posner, S/P Director Slaughter and NEA PDAS Schlicher 
leading the USG delegation (ref F).  GOJ officials have 
proposed the bilateral economic dialogue take place in April 
in Washington. 
 
USAID's Focus 
------------- 
 
¶13. (SBU) The USAID Mission in Jordan is the key conduit of 
$360 million in ESF assistance to Jordan.  The cash transfer 
program representing no more than 45% of the assistance 
bolsters Jordan's short-term stability by helping the GOJ pay 
down external non-military debt.  The program is conditioned 
on policy reform across sectors and results in the GOJ 
programming an equivalent amount of local currency each year 
for mutually agreed priority development projects.  USAID 
projects have touched and continue to improve the lives of 
millions of Jordanians.  Among the successes, USAID 
assistance has renovated or equipped 318 health centers, 
constructed six major water and wastewater treatment plants 
serving four million people, helped create 20,000 jobs in the 
tourism sector, and will build up to 31 new schools and 
renovate 120 schools serving 100,000 students throughout the 
country by 2012. 
 
Post Security and Growth 
------------------------ 
 
¶14. (SBU) Space and security are the biggest management 
issues for Embassy Amman.  Since 2002, Post has grown 70% in 
the number of positions.  Within the past year, the north 
chancery courtyard has been filled in with office space.  OBO 
did not fund the purchase of vacant lots adjacent to the 
Embassy compound as recommended by OBO's business plan, and 
construction of private homes has begun on some of the lots. 
Post will implement in 2010 a perimeter security upgrade. 
The recent suicide bombing in Afghanistan has focused 
domestic and regional attention on security cooperation 
between the U.S. and Jordan.  Though a January 2010 attack on 
an Israeli convoy in Jordan failed, the attack and the use of 
a roadside bomb are negative indicators for the general 
security environment. 
 
Beecroft