GSL issues constructive statement re Iraq, as

C O N F I D E N T I A L SECTION 01 OF 04 COLOMBO 000170

SIPDIS

DEPARTMENT FOR SA, SA/INS, SA/PD, NEA/NGA, DS/DSS/ITA,
INR/NESA; NSC FOR E. MILLARD

LONDON FOR POL/RIEDEL

E.O. 12958: DECL: 01-29-13
TAGS: PREL PGOV PINS ASEC ECON CE MV IZ
SUBJECT: GSL issues constructive statement re Iraq, as
Gulf situation nets increasing attention

Refs: (A) FBIS Reston Va DTG 281221Z Jan 03

- (B) 02 Colombo 1879, and previous

(U) Classified by W. Lewis Amselem, Deputy Chief of
Mission. Reasons 1.5 (b,d).


1. (C) SUMMARY: The Sri Lankan government issued a
constructive statement on January 28, calling on Iraq to
comply fully with UNSC Resolution 1441. The statement
comes as the situation in the Gulf region nets increased
press and public attention here. There is some concern
bubbling up that a possible war could cause oil
shortages and a collapse in remittances from overseas
workers. There is also some worry that a war could
eclipse the good news re Sri Lanka's peace process. So
far, efforts by anti-U.S. elements to mobilize have been
halting. Despite the recent spurt in interest, Sri
Lankans seem preoccupied with their very delicate peace
process and Iraq does not appear destined to become a
major issue. END SUMMARY.

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Constructive GSL Statement
--------------


2. (U) The Sri Lankan Ministry of Foreign Affairs
issued the following public statement re the Iraq
situation on January 28:

Begin text:

"The Government of Sri Lanka has studied the reports
submitted by the UN Weapons Inspection Team to the UN
Security Council on 27th January 2003. The Government
takes note of the statement by the Chief UN Weapons
Inspector that while Iraq is cooperating in the
inspection process, further vital questions remain
unanswered and that, therefore, there has not been full
compliance with UN Security Council Resolution 1441.
The Government of Sri Lanka, therefore, requests Iraq to
fully comply with the resolution. Given the human
political and economic consequences of military
intervention, the Government calls for intensified and
early completion of ongoing UN and other diplomatic
efforts to ensure a peaceful resolution of the
question."

End text.


3. (C) In Mission's assessment, the GSL's statement was
constructive in noting that Iraq was not in "full
compliance" with UNSC Resolution 1441 and calling for it
to comply fully. It was also positive in our estimation
that the statement in effect underscored that the GSL
did not want this matter to be dragged out. Instead,
the statement stressed that there should be "intensified
and early completion" of "UN and other diplomatic
efforts" so as to "ensure a peaceful resolution of the
question."

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Moragoda's Key Role
--------------


4. (C) Senior Minister Milinda Moragoda -- who played a
major role in crafting the statement -- told DCM early
January 28 that he wanted it to be helpful to the U.S.
Moragoda said he had carefully vetted the language with
Prime Minister Wickremesinghe. Wickremesinghe had
approved it, underlining that he wanted the GSL to be on
the record as "broadly supportive" of the U.S. position
on this issue before President Bush gave his "State of
the Union" address later that day. That way,
Wickremesinghe told Moragoda, the government would be
insulated from charges that it was pressured to support
the U.S. on this matter due to the President's speech.

5. (C) During his conversation with the DCM, Moragoda
also indicated that "one minister" was causing problems
re the statement. Moragoda did not name this minister,
but he indicated that this person thought the GSL
statement leaned too much toward the U.S. position.
Mission is not sure which minister Moragoda was
referring to. Our guess, however, is that he was
fingering Foreign Minister Tyronne Fernando or perhaps
one of the four Muslim ministers in the cabinet.
Fernando, in particular, could be the culprit to the
extent that he appears to have bought into the MFA's
long-standing "G-77," NAM-infected perspectives.
Specifically re Iraq, Fernando was in the UAE recently
and while there was quoted as noting "his fear over the
consequences a war would have on the entire world."
Fernando has made similar statements regarding Iraq that
are seemingly focused more on the dangers of a possible
war, as opposed to the greater danger of Iraqi non-
compliance.

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Iraq issue Bubbles to the Surface
--------------


6. (SBU) The GSL's statement comes as the situation in
the Gulf region nets increased press and public
attention here. The press play has been creeping onto
the front pages of newspapers and to the top of evening
TV newscasts. Most of the reporting has been fairly
straightforward and balanced, factually reviewing the UN
inspections and the discussions in New York. Of late,
there has also been more editorial and op-ed comment.
THE ISLAND, one of the three major English-language
newspapers, for example, carried an editorial recently
calling on the U.S. not to go to war with Iraq. The
editorial was relatively balanced and was not caustic.
In terms of the op-ed's, most have decried U.S. policy.
As is common with international issues here, most of
these op-ed's were plucked from foreign (and left-
leaning) sources, such as the GUARDIAN newspaper in the
UK and ASIA TIMES. There has also been a clutch of
op-ed's attacking U.S. policy written by Sri Lankans,
but not many.

--------------
Economic Concerns
--------------


7. (C) In discussions with contacts, there are also
some Sri Lanka-specific concerns, which basically
revolve around the potential harm that could be done to
the country's economy by a possible war. The issues
most often flagged re the economy include:

-- Oil: According to reports, Sri Lanka only has 30
days of petroleum in reserve. The worry is that a war
could cause a huge spike in prices that would disrupt
the country's economy.

-- Budget: The GSL based its 2003 budget on a price of
USD 20 per barrel of petrol. A surge in the price --
which has already occurred to some extent -- would cause
serious budgetary dislocations.

-- Overseas Workers: There are over 700,000 Sri Lankan
nationals working in the Middle East, and a war could
mean that some might lose their jobs and have to stream
home. Remittances are important to the economy and Sri
Lanka might lose some of that income, in addition to
having new unemployed workers to deal with.

-- Tea: Over 54 percent of Sri Lanka's tea exports go
the Middle East, including a small amount to Iraq via
the UN's oil-for-food program. There is fear that this
important market for a key export industry could be
disrupted.
(((Note: The primary concern in the Maldives re a
possible war is also economic in thrust. GoRM
interlocutors have told us that they worry that the
country's tourist industry, a key source of income,
would be negatively affected, as happened in the
aftermath of September 11, 2001. In addition, the
Maldives was largely shunned by tourists during the 1991
Gulf War.)))

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Worry about being Eclipsed
--------------


8. (C) Another concern, though it is a bit inchoate, is
that a possible war could eclipse Sri Lanka's brief role
in the international limelight. Making this point,
Jehan Perera, the head of the National Peace Council, a
local NGO, told us that Sri Lankans for many years had
gotten used to being ignored by the international
community, save for the attention paid to Tamil Tiger
terrorist attacks. The situation had changed with the
advent of the peace process, as Sri Lanka began to
receive positive press coverage and attention from
important governments for the first time in years. A
war in the Middle East would probably put Sri Lanka on
the backburner again. Moreover, Perera remarked, a war
could hurt by allowing the LTTE and elements in the
south to take steps against the peace process out of the
belief that there is no longer international scrutiny.
Another variant on this overall point is that the
aftermath of a war in Iraq could absorb huge amounts of
development assistance funds that might otherwise be
focused on Sri Lanka.

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Anti-U.S. Elements try to Mobilize
--------------


9. (C) So far, efforts by anti-U.S. elements to
mobilize against a possible war have been halting. As
reported in Ref B, there have been some anti-peace
process rallies in Colombo and elsewhere in which vague
sounds have also been made against U.S. Iraq policy. In
general, the rallies against the peace process have not
been particularly well-attended and the addition of the
Iraq element has not appeared to increase their drawing
power.


10. (C) Two groups that have made opposition to U.S.
Iraq policy part of their political planks include the
Sinhalese extremist Janantha Vimukthi Peramuna (JVP)
party and the small network of Muslim extremists.
(Note: Muslims are roughly 8 percent or so of the
population.) Kethesh Loganathan, an analyst at the
Center for Policy Alternatives, a local think-tank, told
us that he did not think the JVP or the Muslims could
make a big play out of Iraq "unless a war turned out to
be longer and bloodier" than expected. With respect to
the major parties, Loganathan commented that some
governing United National Front MP's, especially those
that are affiliated with the Sri Lanka Muslim Congress,
might make noises against the war. The same is true
with some MPs in the president's People's Alliance.

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COMMENT
--------------


11. (C) Despite the recent spurt in interest, Sri
Lankans seem preoccupied with their very delicate peace
process and Iraq does not appear destined to become a
major issue here. If a possible war is longer and
bloodier than expected, the situation could change,
however; in particular, the Muslim population might take
umbrage toward the U.S. That said, the Muslim community
is so split over the peace process and under so much
pressure from the Tamil Tigers, it is questionable what
it could do to show its displeasure. In any case, as
its public statement made clear, the U.S. has a friend
in the Sri Lankan government. We are quite certain the
GSL will try to be helpful to the U.S. in the coming
weeks and months to the full extent it can do so. END
COMMENT.


12. (U) Minimize considered.

WILLS