Identifier
Created
Classification
Origin
04AMMAN3690
2004-05-12 12:09:00
CONFIDENTIAL
Embassy Amman
Cable title:  

IRAQ, PEACE PROCESS WILL DOMINATE DEAD SEA WEF

Tags:  PREL ECON PTER ASEC OVIP KPAL JO 
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C O N F I D E N T I A L SECTION 01 OF 02 AMMAN 003690 

SIPDIS

DEPARTMENT FOR THE SECRETARY, NEA

E.O. 12958: DECL: 05/12/2014
TAGS: PREL ECON PTER ASEC OVIP KPAL JO
SUBJECT: IRAQ, PEACE PROCESS WILL DOMINATE DEAD SEA WEF
MEETING

Classified By: Ambassador Edward W. Gnehm for Reasons 1.5 (b),(d)

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SUMMARY
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C O N F I D E N T I A L SECTION 01 OF 02 AMMAN 003690

SIPDIS

DEPARTMENT FOR THE SECRETARY, NEA

E.O. 12958: DECL: 05/12/2014
TAGS: PREL ECON PTER ASEC OVIP KPAL JO
SUBJECT: IRAQ, PEACE PROCESS WILL DOMINATE DEAD SEA WEF
MEETING

Classified By: Ambassador Edward W. Gnehm for Reasons 1.5 (b),(d)

--------------
SUMMARY
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1. (C) In hosting the second World Economic Forum (WEF)
meeting at the Dead Sea, King Abdullah hopes to promote
Jordan as an island of political stability and economic
opportunity in the region, and portray himself as both a
peacemaker and deal-maker. Your participation underscores
U.S. support for Jordan and the King in achieving that goal
(and has significantly raised the profile of this WEF). The
region you walk into, however, is less optimistic, and
Jordanians are confused, angry, and -- in a few quarters --
somewhat encouraged by U.S. policy in the region. The
upcoming Arab League summit in Tunis has renewed the focus on
regional reform efforts, of which Jordan has played a leading
role. The Abu Ghreib revelations, however, have shaken
Jordanian popular confidence in the moral underpinning of not
only U.S. policy, but American society, and this has
consequently hurt our efforts to promote reform in the
region. The GOJ continues its strong support to rebuild
Iraq, but the King still believes a complete transfer of
sovereignty on June 30 is premature. The number one topic in
Jordan remains the Israel-Palestine conflict, with the
Jordanian mood swinging optimistic or pessimistic in tandem
with perceived U.S. action (or inaction) and movement on the
peace process. The King's recent Washington trip was hailed
here as a diplomatic victory that protected Jordan's
interests and helped the Palestinians, but the President's
subsequent statement to the Arab press that a Palestinian
state by 2005 is "unrealistic" blunted the positive reaction.
As the recently uncovered Zarqawi plot against Jordanian and
U.S. targets in Amman shows, Jordan is a victim of terrorism
and will continue its close cooperation with the U.S. END
SUMMARY.

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FLASHES OF ANGER -- AND HOPE -- ON THE PEACE PROCESS
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2. (C) The Palestinian-Israeli conflict remains at the top
of the agenda for most Jordanians, who look to the United
States to make good on its May 6 "assurances" to King
Abdullah to protect Jordan's interests in the region. The
King's visit was seen here as a diplomatic victory which
balanced what most here perceive as a U.S. policy tilted
towards Israel, but Jordanians were disappointed by President
Bush's remarks to an Egyptian daily that a Palestinian state
by 2005 is "unrealistic." The King and other Arab leaders at
the WEF will press for concrete U.S. steps to improve the
status quo and rein in Israeli military actions, particularly
home demolitions, the tight closure of the West Bank and
Gaza, and targeted killings. The IDF military operations and
violence in Gaza this week provide an alarming backdrop to
the meeting.

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GROWING DISMAY OVER IRAQI SITUATION
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3. (C) The Iraqi prisoner abuse scandal and ongoing
instability in Iraq continue to dominate Jordanian and Arab
media. Outraged by the graphic and offensive nature of the
Abu Ghreib photographs, the crisis has struck a deeply
sensitive chord in this conservative and religious society.
Outside the Jordanian military, most believe the problem is
systematic and not the work of a "few bad apples," and the
scandal has contributed to widespread questioning not only of
U.S. policy in the region, but also of the moral underpinning
of American society. Some of our closest partners on our
reform agenda have said the prisoner abuse scandal has caused
"irreparable" damage to those efforts and our image.
Continued violence in Iraq and uncertainty over the political
transition is of increasing concern as June 30 approaches.
Put off by perceived heavy handed tactics of the U.S.
military in Iraq and insensitivity towards Iraqis --
exacerbated by the abuse scandal and tensions in Fallujah and
Najaf -- popular calls for a speedy U.S. departure are
mounting, as is support for the Iraqi "resistance." By
contrast, the King believes that the June 30 transfer date
may be premature and will caution the U.S. to consider that
move very carefully.

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REFORM EFFORTS CHUG ALONG
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4. (C) The GOJ has taken a leading role in advocating
reform in Jordan and in the region. While insisting that
reform not be imposed from the outside, the GOJ has been
receptive to the Greater Middle East Initiative and is
working within Arab League parameters to advance a reform
agenda during the Arab League summit in Tunis on May 22. A
recurring refrain from Arabs is that a political solution to
the Palestinian-Israeli conflict must be realized so that
true reform efforts can succeed. While political and social
reform efforts in Jordan move forward, the Abu Ghreib scandal
has seriously hurt our ability to sell social and political
reform in the region -- particularly on human and women's
rights. However, there have been a few public voices who
point to the U.S. military and congressional investigations
into Abu Ghreib as a positive aspect of the American
democratic system worthy of emulation (implicitly noting the
lack of such a system of accountability in the region). A
complete investigation and punishment of offenders could over
time help rectify the damage done to America's image.

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JORDAN'S ECONOMY -- GOING STRONG; U.S. TOP TRADE PARTNER
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5. (C) Jordan's economy continues to strengthen. After
growing by 3.3% in 2003, that rate is expected to accelerate
in 2004 with some analysts predicting it may reach 5%. Trade
continues to boom, with Jordan's exports up 29% in the first
quarter of 2004 over the same quarter the previous year. The
U.S. is Jordan's top trading partner and the two-way trade in
2003 exceeded $1 billion. Thanks to economic reforms enacted
by the King, Jordanian exports to the U.S. under the FTA are
growing at a faster rate than those under the Qualified
Industrial Zones, which manufacture products with both
Israeli and Jordanian content. Jordan has also signed an
Association Agreement with the European Union and a regional
trade association with Tunisia, Morocco and Egypt known as
the Agadir Agreement. On the fiscal side, Jordan's total
public debt stands at 92.4% of the estimated GDP for 2004,
down from a high of 111.3% in 1999. Jordan will be
graduating from its IMF program in July. Finally, Jordan
continues to be helpful in recovering frozen Iraqi assets,
returning over $235 million to the Development Fund for Iraq
and promising to transfer more funds shortly.

Visit Embassy Amman's classified web site at

http://www.state.sgov.gov/p/nea/amman

or access the site through the State Department's SIPRNET
home page.

GNEHM