JORDAN AND DEBT ISSUES

C O N F I D E N T I A L AMMAN 002478 SIPDIS STATE FOR U/S LARSON FOR MAY 20 MEETING TREASURY FOR U/S TAYLOR NSC FOR EDSON/LOWERY E.O. 12958: DECL: 05/19/2007 TAGS: EFIN JO SUBJECT: JORDAN AND DEBT ISSUES REF: AMMAN 2475 Classified By: AMBASSADOR EDWARD W. GNEHM. REASONS 1.5 (B) AND (D) ¶1. (C) We understand there will be a high-level interagency meeting May 20 to discuss Jordan's request for debt relief from the Paris Club in the wake of King Abdullah's visit to Washington and meetings with the President, Secretary O'Neill, NSA Rice and other senior U.S. officials. Since there seemed to be some question about where some of our partners in the Paris Club stood on this question, we thought it could be useful to offer the following information. (Reftel provides additional information on the views of IMF staff currently in Amman.) ¶2. (C) After returning to Amman, Ambasssdor Gnehm reviewed with the French Ambassador and British Charge where their governments stand at this point on Jordan's request. The British Charge said that Prime Minister Blair had written a letter to King Abdullah in March that said HMG "fully supports another IMF program and new World Bank lending, and will press for the most generous possible debt rescheduling for Jordan when it attends the Paris Club later this year." That letter, according to the Charge, was cleared by the Finance Ministry and represents his government's policy on this matter. (Following their meeting, the British Charge called the Ambassador to say that Secretary of State for Foreign Affairs Straw is likely to be sending out a letter -- one very similar to the Secretary Powell's letter late last year -- encouraging his counterparts to be supportive of the Jordanians along the lines of the PM's letter.) ¶3. (C) The French Ambassador recalled that he had told the Ambassador before he left for Washington that the French Government had also decided "in response to U.S. prodding" to be forthcoming in responding to Jordanian requests. That decision in Paris had included his Finance Ministry's approval. He had been instructed to inform the Japanese Ambassador in Amman of the agreed French position so as to influence Tokyo to join this "forthcoming" approach. He had done so. Both the French Ambassador and British charge emphasized taht Paris and London developed their positions based on an understanding that Washington wanted to help Jordan. Gnehm