Identifier
Created
Classification
Origin
05BAGHDAD2936
2005-07-13 06:33:00
CONFIDENTIAL
Embassy Baghdad
Cable title:  

BARONESS NICHOLSON; IRAQI COORDINATION COMMISSION KEY TO EU DONOR FUNDING

Tags:  ECON EAID PGOV PREL PINR IZ 
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C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 002936 

SIPDIS

C O R R E C T E D C O P Y - TEXT ADDED (PARA.
C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 002936

SIPDIS

C O R R E C T E D C O P Y - TEXT ADDED (PARA. 1)

E.O. 12958: DECL: 07/11/2015
TAGS: ECON EAID PGOV PREL PINR EAID PGOV PREL PINR IZ IZECON
SUBJECT: BARONESS NICHOLSON; IRAQI COORDINATION COMMISSION
KEY TO EU DONOR FUNDING

Classified By: Charge d' Affaires David M. Satterfield for reasons 1.4
(b) and (d)


1. (C) SUMMARY. European Parliament member Baroness Emma
Nicholson told Charge on July 9 that the Iraqi Transitional
Government must establish a 'coordination commission' in
order to receive European Union funding, as well as to
provide assurances of accountability. Nicholson worried that
the EU 200 million currently in the budget for Iraq
construction would be used for other programs if the funds
are not soon obligated, which could also be reflected in the
2006 budget. Nicholson envisions a EU delegation working
with an Iraqi coordination commission to funnel money through
either the World Bank or UN directly to the 'spending'
ministries. Expressing concern about this direct funding
approach, Charge nonetheless agreed to approach Minister of
Planning and Development Barham Salih about the need for such
a commission, as well as to suggest that the Iraqi Government
develop a prioritized list of feasible projects that the EU
could fund. Baroness Nicholson seemed uninformed on recent ITG
Progress, woking with BAghdad-based donors including the European
Commission/Council rep, developing a new donor coordination mechanism,
and fuzzy on the details of even EU assistance procedures. In a meeting

with Saleh at the Brussels Conference she gave him the impression that
the EU was about to pledge 130 million euros in "new" money, which,
when Saleh's staff pursued it, proved to be inaccurate. We would
welcome comment/insights from USEU. END SUMMARY.


2. (C) European Parliament member Baroness Emma Nicholson
told Charge on July 9 that the Iraqi Transitional Government
(ITG) must establish a 'coordination commission' in order to

receive European Union (EU) funding. Nicholson emphasized
the need to get the Iraqis to a point where they can make
coherent presentations on their requirements. Charge agreed,
noting that the ITG has found it difficult to articulate a
strategic vision, particularly with respect to taking the
difficult steps. The good and bad news, he continued, is the
fact that it is an election year. Government leaders will
need to show progress but, because of potential political
ramifications, getting them to make those decisions will be
difficult.


3. (C) Nicholson pointed to the lack of a donor coordination
mechanism and said Minister of Planning and Development
Barham Salih is under the mistaken impression that money is
pouring into the 'spending' ministries. Charge said that
Salih had previously not been in a position to coordinate,
but this has since been resolved to USG satisfaction.
Nicholson countered that neither the ministries nor ministers
can effectively coordinate, and hence the need to begin with
some kind of a commission structure on which the EU can "hang
its hat." Without that, insisted Nicholson, money will not
be forthcoming, even though EU 200 million is currently
budgeted for Iraqi reconstruction efforts. There have been
other pledges of assistance, said Nicholson, but realizing
those pledges is contingent on spending the money currently
allocated for reconstruction.


4. (C) Nicholson referred to the EU/Iraqi "Framework for
Engagement" the European Parliament adopted on July 6, which
she termed a "warning shot" in the context of the upcoming
2006 budget. There is money to be spent on Iraq's
reconstruction, but she emphasized that the EU will require
"absolute assurance" of a coordination mechanism at the
national level. The spending ministries -- which need to
convert their wish lists into tangible projects -- should use
this mechanism and provide the necessary accountability. If
the money is not obligated soon, worried Nicholson, it could
be used for other purposes. She was supportive of the PRDC
concept, but claimed it is at far too detailed a level for EU
consideration at this stage.


5. (C) Nicholson anticipated that the EU would send a
delegation to Iraq that would want to work with such an Iraqi
coordination commission. Funding, she said, would be
funneled through either the World Bank or UN, but the
ministries themselves would be able to spend the money.
Charge expressed surprise and concern that ministries would
have the flexibility to spend the money, pointing out that
the U.S. coordinates spending with the ministries, but does
not provide them with funding to do with as they please.
Nicholson countered that she had lost much support because of
"unwelcome" changes in the governments of European states in
the course of the last year, so it had taken a great deal of
effort to get even to this point.


6. (C) Charge agreed that the USG could press the ITG to
engage such a mechanism and would suggest that the Iraqis,
specifically Salih, develop a well-scrubbed list of projects,
as well as address the EU's concerns about accountability.
He noted that Mission personnel are currently in Jordan
preparing for the July 18-19 Dead Sea Donors meeting and said
he would direct them to coordinate accordingly with Salih.
E.O. 12958: DECL: 07/11/2015
TAGS: ECON EAID PGOV PREL PINR EAID PGOV PREL PINR IZ IZECON
SUBJECT: BARONESS NICHOLSON; IRAQI COORDINATION COMMISSION
KEY TO EU DONOR FUNDING



7. (C) Nicholson suggested that the most fund-worthy projects
are those that can deliver tangible results, including those
dealing with justice issues, capacity building, rule-of-law,
trade associations and unions, civil society, and police
training, as well as traditional 'bricks and mortar' projects
such as road building. Nicholson said other key areas
include providing potable water and gender mainstreaming
projects that focus on employment training. However, she
voiced concern about the amount of training taking place
outside of Iraq, suggesting that future training be conducted
in-country to the extent practicable.


8. (C) BIODATA: Baroness Nicholson was first elected to the
European Parliament in June 1999 and re-elected in June 2004.
She is the Vice President of the Committee on Foreign
Affairs and a member of the Committee for Human Rights. She
was a Member of Parliament for Devon and West Torridge from
1987-1997 and Vice-Chair of the Conservative Party from
1983-1987. Nicholson is also the founder and Chair of the
AMAR International Charitable Foundation, which she founded
in 1991 to provide emergency aid for refugees in southern
Iraq and the Iraqi marshlands. END BIODATA.


9. (U) REO HILLA, REO BASRA, REO MOSUL, and REO KIRKUK,
Minimize considered.
Satterfield