GSL considering a referendum re federalism

C O N F I D E N T I A L SECTION 01 OF 02 COLOMBO 000551

SIPDIS

DEPARTMENT FOR SA, SA/INS, S/CT; NSC FOR

E. MILLARD

LONDON FOR POL/RIEDEL

E.O. 12958: DECL: 04-01-13
TAGS: PGOV PTER MOPS CE NO JA LTTE
SUBJECT: GSL considering a referendum re federalism
later this year; Tigers suspected in another sea attack

Refs: Colombo 543, and previous

(U) Classified by Ambassador E. Ashley Wills.
Reasons: 1.5 (B,D).


1. (C) SUMMARY: In a March 29 conversation with the
Ambassador, Minister Moragoda said the GSL was thinking
of holding a referendum on federalism later this year.
He commented that the PM believed the referendum idea
could be a way to place opponents of the GSL's peace
initiative on the defensive. Moragoda also said a
report re the security zones in Jaffna will soon be out.
In other developments, the Tigers have apparently struck
again, attacking a navy ship late March 31. In our
view, a referendum may be a way to move the peace
process forward, but it needs careful planning or it
could backfire. END SUMMARY.

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Possible Referendum
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2. (C) The Ambassador spoke March 29 with Milinda
Moragoda, the Minister of Economic Reform and a key
player in the Sri Lankan government on peace issues.
Moragoda mentioned that the GSL is considering holding a
peace-related referendum possibly in the September
timeframe. The preliminary thinking is that the
referendum would allow Sri Lankans to vote on whether
they approve of a federalist-type negotiated solution to
the conflict. The exact wording of the referendum has
not been put together yet, Moragoda remarked, and would
hinge in large part on the status of GSL discussions
with the Liberation Tigers of Tamil Eelam (LTTE) on the
federalism issue. (Note: The discussions re federalism
only kicked off at the sixth round of talks held last
month and are in their embryonic stage -- See Reftels.)


3. (C) Re the potential political ramifications of such
a move, Moragoda commented that Prime Minister
Wickremesinghe felt that such a referendum, if it was
handled correctly, could win overwhelmingly. It would
also have the benefit of placing anti-peace process
elements in the south of the country on the defensive.
The referendum process itself, Moragoda noted, is a
relatively simple and straightforward one: All the
government needs is a majority in Parliament to approve
the text and it can then be taken to the public for a
vote.

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Report re Security Zones
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4. (C) Moragoda also mentioned that a long-awaited
report re the Sri Lankan government's controversial
"high security zones" in Jaffna has been given to the
GSL. (Note: The zones cover about 18 percent of the
land area of Jaffna District. The LTTE and many Tamils
have demanded that the zones be drastically decreased in
size, but the military says it needs the zones for
defensive purposes -- see Reftels.) The report was
drafted by Satish Nambiar, a retired Indian general, who
visited Sri Lanka earlier this year to assess the
situation in Jaffna. Moragoda said the report, which
the government was reviewing, was quite elaborate in
that it provided for large-scale monitoring, including
of heavy weapons, and for the shifting and consolidation
of troops. Nambiar is due to visit Sri Lanka in late
April to discuss the report with the government and the
LTTE. (Note: The fact that the report is ready and has
been given to the GSL is close-hold, and has not hit the
press yet. Mission has not yet seen a copy of the
report, although Moragoda said he would try to get us
one.)

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Another Sea Attack
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5. (C) In another peace process-related development,
the LTTE's sea wing has apparently struck again. The
Sri Lanka Monitoring Mission (SLMM) has confirmed that
several small boats fired upon a Sri Lankan naval
transport vessel in waters just north of Trincomalee
port late March 31. The attack left up to three sailors
injured, one seriously. The ship, which was carrying
1,500 soldiers, was not seriously damaged and was
reportedly able to continue its voyage to Jaffna. The
SLMM reports that naval personnel fired back and the
navy believed that one of the small boats may have been
sunk. The SLMM could not confirm the claim.


6. (C) The SLMM is investigating the incident and
reports that the LTTE has denied involvement in the
attack in categorical terms. Observers we have spoken
to believe that the LTTE's claim is ludicrous on its
face. They assert that the group is almost certainly
responsible for the attack, as the use of small boats in
lightning raids fits the Sea Tigers' modus operandi
perfectly. The attack also took place very near Sea
Tiger bases on the northeast coast.


7. (C) (((Note: There have been other incidents
recently in the same general area off the northeast
coast: On March 20, for example, unidentified small
boats attacked a Chinese fishing trawler in waters near
the LTTE-controlled town of Mullaitivu. The boat sank,
with the loss of 17 crew. As with the latest incident,
the Tigers denied involvement. In its recently released
report about the March 20 incident, the SLMM admitted
that it could not come to any conclusion about what
happened, with all sides denying they had instigated the
attack. In private, SLMM contacts have told us they
thought the LTTE was responsible. End Note.)))

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COMMENT
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8. (C) We are not sure how serious the GSL is about the
referendum idea. It may be a trial balloon (there have
been some press articles mentioning the idea in general
terms of late). That said, a referendum could prove a
way to move the peace process forward if it is put
together carefully. A big win in a referendum, for
example, could provide the GSL's peace initiative
significant momentum. At the same time, the government
must mull over the matter very carefully. If something
goes wrong, the GSL's plans could backfire and the peace
process suffer possibly irreparable harm. In any case,
we expect that government insiders will debate this
issue for some time before making a final decision on
whether to go forward.


9. (C) Re the March 31 sea attack, we believe that the
Sea Tigers are almost certainly the culpable party. As
we have reported, the Sea Tigers are apparently on a
hair trigger, waiting for the right opportunity to
strike back at the Sri Lankan navy over the sinking of a
LTTE resupply ship last month (see Reftels). END
COMMENT.


10. (U) Minimize considered.

WILLS