NEPAL: BUSINESSES REMAIN CLOSED; INDUSTRY SECURITY

C O N F I D E N T I A L KATHMANDU 001730

SIPDIS

STATE FOR SA/INS, DS/IP/SA
NSC FOR GREEN/DORMANDY
LONDON FOR POL-BELL

E.O. 12958: DECL: 08/30/2014
TAGS: PTER PGOV EINV ASEC NP
SUBJECT: NEPAL: BUSINESSES REMAIN CLOSED; INDUSTRY SECURITY
GROUP UNITED

REF: KATHMANDU 1718

Classified By: Ambassador James F. Moriarty, Reasons 1.4 (b/d)


1. (C) Maoists muddied the waters on August 27 by issuing a
press statement that indicated the Maoist-threatened
businesses, other than those with U.S. investment, could
reopen (reftel) and then an hour later issuing a
contradictory statement that all the businesses must remain
closed. The Industry Security Group (ISG) (the U.S., U.K.,
French, German, and Indian Embassies, along with their
respective binational Chambers of Commerce) met on August 30
to discuss next steps. The industry members were frustrated
and sought guidance about options.


2. (C) The ISG agreed on five measures to put pressure on
the Maoists.
-- The ISG will issue another statement condemning the
continued Maoist threats, the August 28 bombing of Nepal
Lever (a Nepal-India joint venture company),threats against
a German hydropower development site, and the threat to close
down all multi-national corporations with U.S. investment.
The U.K., as chair of the ISG, will circulate a draft
statement to members on August 31.
-- ISG members who are members of the EU will ask the EU to
issue a statement condemning Maoist tactics and their effect
on the Nepali people.
-- Members will individually and privately undertake to urge
the Prime Minister to consider meeting a Maoist demand to
release information about the whereabouts and details of some
Maoist detainees within a week. (The GON had agreed to do
this within a month, and perhaps earlier, and the ISG agreed
that releasing this information sooner would be consistent
with the GON's human rights commitments.)
-- Industry and trade unions will get together to keep the
issue and its effects on Nepali workers before the public.
-- Industry members will check with the Federation of Nepali
Chambers of Commerce and Industry (FNCCI) on its plan to
develop a program of sustained activities to demonstrate the
public's frustration with the effects of the Maoists' tactics.


3. (C) COMMENT. The conflicting Maoist demands and actions
appear to be designed to divide the ISG members. The Embassy
believes it is key for the ISG to remain united by issuing an
ISG statement condemning not only the continued closure of
industries, but also the threat against businesses with U.S.
investment. Embassy will forward the text of the ISG
statement to the Department once it is agreed upon.
MORIARTY