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