AMBASSADOR'S FAREWELL CALL ON PRIME MINISTER

C O N F I D E N T I A L TUNIS 001947


DEPT FOR NEA/ENA

E.O. 12958: DECL: 07/23/2008
TAGS: PREL PGOV TS
SUBJECT: AMBASSADOR'S FAREWELL CALL ON PRIME MINISTER
GHANNOUCHI

Classified By: Ambassador Rust M. Deming, Embassy Tunis
Reason: 1.5 (B) and (C)


1. (C) Summary: Ambassador, accompanied by DCM, paid a
farewell call July 22 on Tunisian Prime Minister Mohamed
Ghannouchi. In a wide-ranging review of US-Tunisian
bilateral relations, the Ambassador encouraged the GOT to
build on its impressive record of economic and social
development and to continue efforts to integrate Tunisia and
its regional partners into the global economic and political
system. PM Ghannouchi noted the historic ties between the
two countries, and expressed appreciation for US economic and
development assistance dating from the earliest days of
Tunisian independence. The PM said that Tunisia continued to
place great value on its relationship with the United States,
even if it disagreed at times with US policies in the region.
He agreed that a consensus existed in Tunisia on the need to
build a more democratic society, but argued that this must be
undertaken at a measured pace to avoid "mistakes." The GOT
looked forward to the first Trade and Investment Framework
Agreement (TIFA) roundtable in Washington in the fall, and
said the Minister of Development and International
Cooperation would likely lead the Tunisian delegation to the
talks. On regional issues, the PM underlined the need for
continued US engagement in efforts to resolve the
Israeli-Palestinian conflict and urged the US to put Q place
an interim Iraqi government and proceed quickly with the
reconstruction of the country and the reintegration of Iraq
into the global economy. End summary.


2. (C) Ambassador paid a farewell call on Tunisian Prime
Minister Ghannouchi on July 22. During his tenure as Prime
Minister, Ghannouchi has served as the coordinator of GOT
economic policy and the conversation focused on economic
issues. The Ambassador expressed optimism about the state of
US-Tunisian relations, and noted that even during periods of
disagreement on regional issues, Tunisians kept their longer
term interests in mind and maintained an open channel of
communication with US officials. The PM replied that
US-Tunisian ties were longstanding, and he expressed deep
appreciation for the historic role of the United States in
assisting Tunisian development from the earliest days of the
country's independence. Noting the role of USAID and other
USG agencies in Tunisia, the PM said these infrastructure and
development projects had made the Tunisian economy "better
armed" to face the increasing demands of globalization. The
PM added that the GOT remained concerned about the future,
particularly in view of the world economic downturn, but his
government was committed to staying the course on support for
education, infrastructure development and private sector
reform.


3. (C) In response to the Ambassador's comment that there
appeared to be a large consensus within the Tunisian
political class on the need to build a more open political
and economic system and a more democratic society, the PM
said the only point of contention was on the speed of reform.
Agreeing that there was "no debate" in Tunisia on the need
to safeguard the country's achievements in the social and
economic sectors (particularly with regard to the rights of
women),the PM stated that the GOT did "not have the freedom
to make mistakes," and "must remain vigilant" to the threat
from the secular extremists on the left and the religious
extremists on the right. PM Ghannouchi added that the GOT
was committed to maintaining the "tolerant, moderate and
progressive" character of the Tunisian state, but that this
required a gradual approach. Appealing for understanding
from the west about the measured pace of political opening in
Tunisia, the PM joked that "even in the US you have speed
limits on your highways!"


4. (C) On the economic front, the Ambassador said that he
hoped to see increased US investment in Tunisia, and that in
this regard, it would be important to resolve
Algerian-Moroccan bilateral differences over the Western
Sahara in order to reinvigorate the moribund Arab Maghreb
Union (UMA, in French). The PM agreed that the slow pace of
regional economic integration placed Tunisia and its partners
at a disadvantage, but he expressed the hope that UMA could
be revived and that Tunisia would attract increased foreign
direct investment, particularly from US companies. Reviewing
Tunisia's efforts to build a "larger economic space,"
Ghannouchi reitrated the GOT commitment to the Barcelona
Process, the 5 plus 5 dialogue, and the expansion of free
trade agreements between Europe and North Africa.


5. (C) Turning to other bilateral and regional issues, the PM
said that Tunisia looked forward to the first TIFA roundtable
in Washington in the fall, and confirmed that the Minister of
Development and International Cooperation would likely lead
the GOT delegation. On the Israeli-Palestinian conflict,
Ghannouchi said the success of the process hinged on
continued US engagement. On Iraq, the PM underlined the
importance for Tunisia and the rest of the Arab world of the
establishment of an interim government headed by Iraqis,
adding that the reconstruction of Iraq and the reintegration
of the country into the world economy were equally critical.


6. (C) Comment: There are rumors rampant of a significant
government reshuffle following the ruling RCD party congress
next week, so the Prime Minister may be replaced, along with
many members of his government. Despite this, we expect the
broad lines of Tunisian domestic and foreign policy to remain
constant. Tunisia places a high value on its bilateral
relationship with the United States, and before the conflict
in Iraq, senior GOT interlocutors assured us that the
relationship would weather the storm. This has proven to be
the case, and Ghannouchi's comments reflect the broad view
within the GOT that it is important to move quickly to resume
business as usual. The Tunisians see the upcoming TIFA
discussions as part of this, and the GOT looks forward to an
enriched bilateral dialogue on a range of issues.


DEMING