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2004-06-08 14:28:00
Embassy Amman
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						S E C R E T SECTION 01 OF 02 AMMAN 004667 


E.O. 12958: DECL: 06/08/2014
(JUNE 8-16)

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

1. (C) King Abdullah is very pleased to have been invited to
attend the G-8 Summit to discuss reform in Jordan, as well as
in the Middle East. The King sees himself as a leader in the
region on reform and will attempt to speak for other
reform-minded Arabs during his visit. The King, however,
will be conscious of his exposure in the region given the
absence of other key Arab leaders (Egyptian & Saudi). The
situation in Iraq and the MEPP will feature prominently in
his schedule of activities.

2. (C) G-8 REFORM PLAN: The GOJ is vocal about the need for
political and economic reforms in the Arab world and
advocated strongly for a positive reform statement at the
recent Arab League summit. Nevertheless, Jordan has been
circumspect in endorsing U.S.-generated proposals for reform
in the region. In a press interview June 7, the King stated
that reforms must "emerge from within," rather than be
imposed from the outside, cannot ignore the
Israeli-Palestinian conflict, and must take into
consideration "each state's particularities." Foreign
Minister Muasher and other officials, citing discussions at
the Arab summit, have announced publicly that any G-8 reform
plan for the region must be limited to Arab states only given
the differences between Arab and other Muslim countries. The
King in private may be more flexible regarding the
geographical scope of the G-8 initiative.

3. (C) MEPP: The GOJ agrees that Israeli PM Sharon's Gaza
withdrawal plan could represent an important opportunity in
the peace process, but insists that the withdrawal be
coordinated with the Palestinians, considered as part of the
roadmap, and not come at the expense of Palestinian claims to
the West Bank. Jordan continues its opposition to the
construction of the Israeli security barrier outside the
Green Line amidst fears that this could prompt a transfer of
Palestinians from the West Bank to Jordan. The King remains
frustrated at the Palestinians' failure to take steps against
terror groups and blames Arafat for this inaction.

4. (C) IRAQ: The GOJ has been steadfast in assisting our
efforts in Iraq and quickly issued a public statement
supporting the formation of the Iraqi Interim Government
(IIG). Although officials have told us in private that the
IIG selection process was not perfect, they recognize the
difficulties involved and have promised to cooperate with the
new governing body. The fact that new Iraqi President
al-Yawer is a Sunni sheikh of the influential Shammar tribe
(which has some members in Jordan), and that Ahmad Chalabi is
not an IIG member, positively affects the IIG's image in

5. (S) MILITARY ISSUES: Jordan has been a resolute ally in
the Global War Against Terror. Through its field hospital in
Fallujah and its deployment of special forces in Afghanistan,
for example, the GOJ has gone to considerable lengths to
support U.S. actions to combat terrorist groups. There
remain continual challenges with military funding, however,
as Jordan lacks funds for the modernization of its armed
forces necessary to address our requests for their support in
the region. The King requested a $400 million supplemental
in military assistance during his last visit to the U.S., and
he will likely re-engage U.S. officials with the need for an
FY04 supplemental. We believe that high on his list of
priorities will be the establishment of a special operations
and counter-terrorism (CT) training center. Additionally,
the King may speak about incremental costs of increased
border security deployments, as well as unpaid bills from
U.S. Forces in Jordan before and during Operation Iraqi
Freedom. Finding fund sources for border integrated
enhancements, i.e., sensors, cameras, fiber optics,
surveillance platforms, etc. and C4ISR (intranet architecture
and wireless and secure communications connectivity between
radar systems and command centers), thus enabling rapid
response to ground or air incursions, may also be part of the
King's military supplemental request.

6. (C) ECONOMIC ISSUES: The King's significant economic
reforms are beginning to bear fruit. Jordan's trade with the
U.S. is booming. If current trends continue, Jordan will
export $1 billion worth of goods to the U.S. this year,
solidifying our role as Jordan's major trade partner.
Jordan's debt picture continues to improve, with the debt/GDP
ratio down to 89.7% from a high of 111% as recently as 1999.
The GOJ is continuing a close consultative relationship with
the IMF and will graduate from its IMF program next month.
Unfortunately, U.S. exports to Jordan have remained static as
imports have surged. The King should also be urged to ensure
that Jordan's government procurement activities be
transparent and offer a level playing field to U.S. companies
bidding on government tenders.

7. (U) Baghdad minimize considered.

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