UN DEVELOPMENT PROGRAMME'S IRAQ DIRECTOR LAYS OUT

UNCLAS SECTION 01 OF 02 BAGHDAD 003547

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SUBJECT: UN DEVELOPMENT PROGRAMME'S IRAQ DIRECTOR LAYS OUT
HIS PRIORITIES FOR IRAQ

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1. (SBU) SUMMARY: Paolo Lembo, Country Director of the
United Nations Development Programme Iraq, met with IRMO
Director Daniel Speckhard on August 14 to discuss UNDP
priorities in Iraq after having recently opened its liaison
office in Baghdad. He stressed UNDP's focus on building
Iraq's weak government capacity and expressed support for
IRMO's participation in the August 18th southern
reconstruction conference, especially if the message is "we
are here to listen and want to work with you." He wants to
support the creation of a Committee for the Implementation
of the Constitution to maintain momentum on key contentious
issues, such as human rights and decentralization, and to
promote civil service reform as well. Lembo requested
discreet US assistance in pressing UN headquarters in New
York to establish more quickly a permanent UNDP mission in
Iraq.
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BUILDING LOCAL GOVERNMENT CAPACITY
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2. (SBU) Paolo Lembo, Country Director for the United
Nations Development Programme (UNDP) met with IRMO Director
Daniel Speckhard on August 14 to discuss UNDP's priorities
for Iraq after having recently established a liaison office
in Baghdad. Lembo stressed the need to build the capacity
of Iraq's local government, which he described as "in worse
shape than in the countries emerging immediately after the
collapse of the Soviet Union." He characterized local
government as "a fragmented mixture of parties, tribes and
mafias" and bemoaned their lack of skills in basic
organization, budgeting, project preparation and
implementation. He expects power will be gradually
decentralized in the post-Constitutional period and,
therefore, sees a supportive role for donors to play in
facilitating this process.


3. (SBU) Lembo said the Prime Minister intends to allocate
$50 million to support small-scale rehabilitation. For its
part, the UNDP, Lembo averred, will try to match those
funds and use this partnership initiative as a vehicle to
build local capacity. Lembo admitted that he sees an "us
versus them" attitude between the Prime Minister's Office
and Planning Minister Barham Salih but couched it by
saying, "I would not want to over-dramatize it."

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SOUTHERN RECONSTRUCTION CONFERENCE IN NASIRIYAH
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4. (SBU) Lembo said he and an aide to the Prime Minister's
Higher Reconstruction Council will participate in
the Southern Iraq Reconstruction and Development Co-
ordination Group (SIRDCG) monthly meeting in Nasiriyah, in
which Planning Minister Salih will lead a ministerial
delegation, and send a message of international support for
more local/regional ownership of the rebuilding process.
Though the SIRDCG has functioned poorly in the past, Lembo
expressed confidence that this time the Group will be
better organized (NOTE: The SIRDCG is an emerging Iraqi-led
donor coordination institution composed of leaders from the
four southern governorates and launched earlier this year
through British mentoring. Recently, the United Nations
became its co-Chair END NOTE). Lembo plans to use the
occasion to announce eight UN-funded projects worth $15
million. He suggested that the US also use the occasion to
announce its projects in the region. These eight UN
projects are part of a larger $60 million UNDP initiative
to promote community development in Iraq.


5. (SBU) As to suggestions that IRMO attend the Nasiriyah
meeting, Lembo agreed that high level US support for more
regional ownership of the rebuilding process would be well
received in the south, especially if the message is "we are
there to listen and we want to work with you." As for
Provincial Reconstruction Development Councils (PRDCs) and
Provincial Support Teams (PSTs),Lembo regards them
favorably and thought the PST system could include capacity
building as well as program delivery support. IRMO Daniel
Speckhard explained to Lembo that though American
initiated, over time some PSTs could be led by other donors
interested in supporting local and regional initiatives
(NOTE: Due to a conflicting Council of Ministers meeting on
that day, Salih instructed his deputy to lead an Iraqi
delegation of two Assembly Members and the Prime Minister's
Reconstruction Advisor to attend the Nasiriyah conference.
The Iraqis were joined by senior donor officials led by AMB
Dan Speckhard END NOTE).


6. (SBU) As for the National Development Strategy, Lembo
described it as "a document that remains alien to most
people." He said he would propose to the Planning Ministry
that it launch a program of local roundtables to spur
discussion about key elements of the document. Lembo hopes
Minister Salih will raise the NDS at the conference in
Nasiriyah.
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SEEKS CREATION OF NEW IRAQI-LED INSTITUTIONS
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7. (SBU) Lembo expressed a desire to spur the establishment
of a Committee for the Implementation of the Constitution,
a new and independent Iraqi institution that would maintain
momentum on contentious constitutional issues, such as
decentralization and human rights. This Commission could
sustain a sense of continuing progress within the Iraqi
public in the post-referendum period. UNDP is ready to
provide financial and technical support to this new body.
In addition, he also wants the UNDP to offer Iraq technical
expertise in the area of civil service reform.

8. (SBU) Lembo lauded Planning Minister Salih's effort to
promote investment in Iraq but thought this work is better
suited for USAID, which is already supporting the
establishment of an investment promotion agency. Lembo
hoped, though, that Salih would focus more on making
practical changes to the country's unattractive legal
structure. IRMO Director Speckhard noted the focus of US
reconstruction on private sector development and need for
Iraq to prepare itself for looking to private capital
markets to help finance its reconstruction.

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UN-NEW YORK DELAYS SETTING UP PERMANENT UNDP OFFICE IN IRAQ
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9. (SBU) Lembo shared his frustration with his headquarters
in New York, which he described as negative to the idea of
establishing a more fully-staffed permanent UNDP office
within the UN Assistance Mission in Iraq (UNAMI). He
requested from IRMO Director Speckhard discreet US
assistance in encouraging UN headquarters to move forward
more quickly on a permanent UNDP presence in Iraq. As to
the upcoming visit of World Bank Country Director Joseph
Sabah, Lembo mentioned that he had worked with him in the
past. He recounted his offer to Sabah to form a joint
UNDP-World Bank office within UNAMI in which UNDP would
offer the Bank security, administrative support and
transportation.

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COMMENT
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10. (SBU) The assigning of a UNDP Country Director in Iraq
signals the multilateral organization's increasing
commitment to engage more seriously in the rebuilding of
Iraq. This includes opening UN regional offices in Erbil
and Basrah. However, other UN officials working in Iraq
routinely echo Lembo's complaint that the UN bureaucracy in
New York City is delaying a fuller UN presence. END
COMMENT

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