SCENESETTER FOR DEPUTY SECRETARY ARMITAGE'S

S E C R E T SECTION 01 OF 03 KUWAIT 003681 SIPDIS NOFORN STATE FOR THE DEPUTY SECRETARY, STATE ALSO FOR NEA/FO, NEA/I, NEA/ARPI, S/CT, T, PM, AND S/WCI E.O. 12958: DECL: 10/26/2014 TAGS: PREL MARR PTER PGOV KJUS KISL KU IZ SUBJECT: SCENESETTER FOR DEPUTY SECRETARY ARMITAGE'S NOVEMBER 6 - 7 VISIT TO KUWAIT REF: A. KUWAIT 3658 ¶B. KUWAIT 3637 ¶C. KUWAIT 3592 ¶D. KUWAIT 3481 ¶E. KUWAIT 2050 ¶F. KUWAIT 1500 Classified By: Ambassador Richard LeBaron for reasons 1.4 (b) and (d) ¶1. (S/NF) Mr. Armitage, welcome back to Kuwait. MFA is working on a November 7 meeting with Prime Minister Shaykh Sabah Al-Ahmad Al-Jabir Al-Sabah and arranging accommodations for your party at Bayan Palace, which is also where any bilateral meeting will take place. Despite the extremely poor health of the Amir and the Crown Prince, there is no sense of a leadership or any other type of crisis here -- the economy is booming, Shaykh Sabah is accepted as de facto leader, and there is less concern about Iraq developments than might be expected. The main thing on your interlocutors' minds when you arrive will be the policies of the winner of the U.S. Presidential race. Since your July trip, there has been significant progress on several key issues including fuel, Article 98, and Guantanamo detainees. Senior GOK officials confirmed to PM A/S Bloomfield and PDASD Flory that fuel for OIF support will continue to flow through the end of the year at no cost, with a possibility for a three-month extension. FM Shaykh Dr. Mohammed told Bloomfield and Flory that Article 98 agreement was being "fast-tracked" in Parliament. Arrangements have been made for the transfer to Kuwaiti authorities of one Guantanamo detainee and there is improvement in the sharing of information on the status of Kuwaiti nationals in U.S. custody. The Kuwaitis have been very cooperative and your trip, just months after your last visit, sends a strong message that the U.S. recognizes and appreciates GOK support of U.S. interests in the region, something Kuwait's leadership desperately wants to hear. ¶2. (S/NF) There is a widening perception amongst Kuwaiti officials that there is not enough give and take in the bilateral relationship. The Kuwaitis need reminding there are other areas where our partnership can flourish. We signed a Trade and Investment Framework Agreement (TIFA) in February and would like to see more progress toward concluding a Free Trade Agreement (FTA). We have shared concerns about Iraq's future and the GOK is particularly interested in preparations for the January elections, the training and arming of Iraq's military, and the Sunni role in a new Iraq. There is deep interest in your comments on Iraq's debt and the debate continues on how much Iraq should reimburse to the GOK. Additionally, we have very different opinions on the most effective counterterrorism measures and have opened a dialog to encourage Kuwait to take a more aggressive approach. Finally, there is some anger in the royal family about the need to appear for visa interviews, particularly given the easy access to Kuwait by American forces and private citizens. Iraq -------------- ¶3. (S) The GOK remains a strong supporter of Iraq's political transformation and to that end, has provided considerable assistance to the U.S. and OIF, often at some political risk. There is deep concern the U.S. presidential election will negatively affect the U.S. commitment to Iraq and the GOK seeks reassurance of our resolve in helping Iraq become stable. There is also concern that once trained and equipped, the Iraqi military could pose a threat to Kuwait's security. You should reemphasize the necessary defensive role of Iraq's armed forces. The GOK is also carefully watching the actions of Iraq's neighbors. They are critical of Iranian and Syrian interference and would like to see their influence constrained. Fuel for OIF -------------- ¶4. (C) Energy Minister Shaykh Ahmad confirmed the continued flow of free fuel in support of OIF until the end of December, with an option to extend for three months. At the center of the matter is the signing of a bilateral agreement which will satisfy constitutional and budgetary requirements. The PM explained to the Ambassador October 24 that a contract was needed to protect his Energy Minister from parliamentary inquiries and to avoid embarrassment to our two governments. The agreement means that U.S. and coalition forces will continue to receive approximately 1.3 million gallons/day worth approximately $1.2M. Free fuel beyond March 2006 is unlikely absent political intervention at the highest levels. (Note: Free fuel for U.S. military operations in Kuwait proper is not in question. End note.) Counterterrorism -------------- ¶5. (S/NF) DNSA Townsend delivered a strong message on the need for a more aggressive approach to counterterrorism in May, and the Ambassador, since his arrival, has repeatedly raised the topic with Kuwait's leadership. We are not convinced the Kuwaiti approach of attempting to co-opt jihadis through family, tribal, or social networks is effective. The absence of a major terror attack in Kuwait is not proof that the GOK policy is sound, although that is the litmus test for Kuwait's leadership. We look for the aggressive pursuit of suspected terrorists, stopping the flow of funds from Kuwaitis to terror groups, better implementation of laws related to investigating suspects, and standing up to Kuwaiti Islamists who advocate leniency when dealing with suspected terrorists. Additionally, the counterterrorism dialog needs to occur at the political as well as the intelligence and security levels. TIFA -------------- ¶6. (SBU) We signed a Trade and Investment Framework Agreement (TIFA) with Kuwait in February in anticipation of eventually concluding a Free Trade Agreement (FTA). The first TIFA Council meeting was held in Washington in May and USTR outlined three issues on which Kuwait must make substantive progress to ensure continuation of the TIFA process: intellectual property rights (IPR),standards (technical barriers to trade),and service and investment requirements. The Embassy has engaged the GOK on IPR, in particular, as a test of GOK resolve for the TIFA/FTA process and the Ambassador recently got agreement from the Commerce Minister to convene a bilateral roundtable in order to map out a way forward to bring Kuwait into compliance with international standards. You will want to reaffirm U.S. interest in working with Kuwait in fleshing out the TIFA process and moving expeditiously to an FTA, noting that this depends on genuine reforms. Iraqi Debt -------------- ¶7. (C) There was considerable interest in your September 24 comments that pre-invasion loans from Gulf states to Iraq should be considered grants, not loans. Iraq's total current debt to Kuwait is estimated to be approximately $45 billion, comprised of pre-1990 invasion loans of $17 billion and awarded-but-unpaid UNCC reparations of $28 billion. To date, Kuwait has received $9 billion in compensation payments. The USG has urged Kuwait to forgive the vast majority of its debt claims on Iraq. In particular, we have supported the IIG request for 95% debt reduction. We first plan to negotiate a debt reduction agreement in the Paris Club, and then non-PC creditors such as Kuwait would be invited to extend at least comparable terms. On reparations claims, we support maintaining the status quo, i.e. 5% of Iraqi oil export revenues should continue to go to the UN Compensation Commission. Kuwait is the main recipient of funds through this mechanism. Article 98 -------------- ¶8. (C/NF) The FM recently told A/S Bloomfield and PDASD Flory the Article 98 issue would be resolved shortly. He said ratification would be fast-tracked in Parliament which reconvened October 26. Although GOK action on Article 98 has been slow, its resolve is certain. Nevertheless, the National Assembly has no deadline by which it must act and the issue will require monitoring. (Note: We treat the existence of the agreement as confidential because it has not been publicly confirmed by the GOK. End Note) Guantanamo Detainees -------------- ¶9. (S/NF) Twelve Kuwaitis are among the detainees at Guantanamo, nine of whom have been designated enemy combatants. Arrangements are underway for the return to Kuwaiti authorities of detainee Nasser Al-Mutairi and the GOK has requested the repatriation of Adel Zamil Abdul Mohsin Al-Zamil. The case of Abdalla Salis Ali Al-Ajmi will be subject to Administrative Review Board proceedings to determine whether he can be released or transferred to GOK authority. Embassy contacts report GOK requests for the return of all twelve detainees are for public consumption only. The PM and several other senior officials are glad not be burdened with the problem. In addition to the Guantanamo detainees, a Kuwaiti minor is being held in Abu Ghraib. The FM has noted GOK interest in interrogating the young jihadi and the matter is being addressed through U.S. law enforcement channels. Anger Over Visa Procedures -------------- ¶10. (SBU) Just as we finalized this report, the Ambassador received a call from the Chief of Protocol advising that the PM is angry over treatment of Kuwaiti royal family members and other notables who need to apply in person for visas at the Embassy. A formal request will be forthcoming requesting exemption from interviews for members of the royal family, diplomatic passport holders, and other special passport holders, such as Members of Parliament. The Kuwaiti official noted pointedly the facilities granted to U.S. military and private Americans to easily grant them entry into Kuwait, including airport visas, with the threat of some sort of retaliation barely veiled. We will work this issue before you arrive, but there is a chance that you will hear about it from your Kuwaiti interlocutors. LeBaron