UNCLAS BAGHDAD 002374

SIPDIS

SENSITIVE

USDA FOR FAS/OA/ESTERPSTRA,
FAS/FAA/CALEXANDER/JDEVER
FAS/EX/MMCAMBLISS,
FAS/ITP,
CMP/G&F/PLETARTE, LBACHELDER, DWILLIAMS
FAS/IRAQ TASK FORCE/LASCHATZ

E.O 12958: NONE
TAGS: EAGR ETRD PREL IZ ECON
SUBJECT: LATEST FROM IRAQ'S MINISTER OF TRADE ON THE PDS.


THIS CABLE CONTAINS SENSITIVE BUT UNCLASSIFIED INFORMATION -
FOR GOVERNMENT USE ONLY - NOT FOR DISTRIBUTION ON THE
INTERNET.


1. (SBU) In a June 1 meeting with IRMO reps Minister of
Trade Abd' al-Bassit Kareem informed us that he does not
expect new wheat, sugar or rice imports into Iraq for the
Public Distribution (food ration) System (PDS) until mid-
July. According to the Minister, US wheat, including a
shipment from Cargill continues to offload in Tartous, Syria
and is being distributed throughout Iraq. He also informed
us that on May 31 he was interviewed by Al Arabiya
television and informed the audience that new procedures are
being developed by the Ministry that should allow PDS food
supplies to flow more regularly in July.


2. (SBU) The Minister also developed and proposed new
contracting procedures for the Ministry and submitted them
to the Cabinet. He believes these will be approved in the
coming week. Minister Kareem agreed to share the new
procedures with us once they are approved. Wheat, sugar and
rice tenders are currently being finalized for the PDS.
Minister Kareem will limit these tenders to well-established
international suppliers and consortia, sticking to a vow he
made during our initial meetings with him. (septel)


3. (SBU) In addition to expecting a two-week timeline for
bids to come in for the Ministry's tender, Minister Kareem
is meeting twice weekly with the Ministry of Finance (MOF)
to ensure funding for the anticipated tenders. In addition
to the current tenders, he continues to work closely with
the MOF to line up funding for an additional 2 to 5 months
worth of PDS requirements. His intention is to build
reserves, funding permitting.


4. (SBU) In addition to PDS issues, the Minister continues
to worry about security: both his own and that of the new
Ministry compound. IRMO is working to address his concerns.
A new MOT satellite office within the International Zone
should be ready for occupancy in the next weeks, providing a
more secure location for the Minister to meet with USG
representatives.

Satterfield