SCENESETTER FOR THE SECRETARY'S VISIT TO THAILAND

C O N F I D E N T I A L SECTION 01 OF 05 BANGKOK 004324

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DEPARTMENT FOR THE SECRETARY, EAP, EAP/BCLTV

E.O. 12958: DECL: 06/28/2015
TAGS: PGOV PREL OVIP TH
SUBJECT: SCENESETTER FOR THE SECRETARY'S VISIT TO THAILAND

Classified By: Ambassador Ralph L. Boyce. Reason 1.4 (a and d)

SUMMARY


1. (C) Madame Secretary, all of us in Thailand look forward
to your visit to Phuket. The Royal Thai Government is
particularly enthusiastic about hosting you: Prime Minister
Thaksin Shinawatra (Prime Minister TOCK-sin) and Foreign
Minister Kantathi Suphamongkhon (Minister KHAN-ta-tee) plan
to join you for meetings there. Deputy Prime Minister and UN
Secretary General Candidate Surakiart Sathirathai (Deputy

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Minister SUR-a-ki-aht) plan to escort you as you tour tsunami
recovery sites. Coming six months after the devastating
December 26 tsunami, your visit will give you an opportunity
to showcase private and public sector assistance to the
region and highlight the resilience of the Thai people as
they rebuild their lives. In your meetings with senior
leaders, you can tap into the good will generated by
America's historic response to the tsunami to advance a
number of key foreign policy objectives. On the security
front, you can express our willingness to deepen dialogue
about strategic issues while urging Thailand to provide more
material support for recovery operations in Iraq and to
endorse the Proliferation Security Initiative. The Thai have
strong relations with Beijing (Thaksin is there right now, as
a matter of fact, celebrating the 30th anniversary of
diplomatic relations) and will welcome hearing about your
trip to Beijing and sharing views on China's growing role in
Southeast Asia. You can discuss our ongoing bilateral Free
Trade Agreement (FTA) talks and express our hopes that we
conclude a comprehensive agreement. With former FM
Surakiart's UN candidacy a key Thai objective, you can expect
your interlocutors will be ready and willing to discuss UN
reform. While supportive of constructive engagement with
Burma, PM Thaksin has recently expressed growing frustration
with the ruling junta in Rangoon and can share his views on
prospects for reform in Rangoon. Thaksin remains a key ally
in the Global War on Terror and will welcome your thoughts on
this subject as well as developments in Iraq and Afghanistan.
He will likely share his opinions on his largest domestic
challenge -- unrest in the predominantly Muslim provinces of
southernmost Thailand. FM Kantathi plans to visit Pyongyang
shortly after your visit and wants to discuss the North
Korean situation. End Summary.

AFTERMATH OF THE TSUNAMI -- RECOVERY UNDERWAY


2. (U) The massive rescue and recovery operation undertaken
by the U.S. military as a result of the December 26 tsunami
was historic and will likely be studied as a model for years
to come. Mercifully, U.S. casualties were much lighter (two
dozen confirmed or presumed dead) than those suffered by
other countries. Thousands of Thai, Europeans and other
Asians were killed -- primarily in resorts north of Phuket --
a haven for vacationers during the holiday season. Total
fatalities will likely never be known; the official number is
about 5,400 but Thai officials privately say they expect the
final death toll to top 8,000.


3. (SBU) While previous dignitaries visiting the devastated
area were able to focus on the destruction itself, your visit
can highlight recovery efforts. Such a message would be
welcomed by senior Thai officials who are telling the world
that Phuket is again open for business and asking foreigners
to spend their tourist dollars there as a way to help locals
recover. The outpouring of assistance from around the world
has been overwhelming. There are a number of sites you may
wish to visit to witness for yourself this generosity. For
example, students at the International School of Bangkok have
raised over 800,000 dollars from children around the world to
help rebuild a school in the Khao Lak area that was destroyed
by the wave. The project site, jointly supported by the King
of Thailand, is a beehive of activity and is already the home
of 700 students, including 181 tsunami orphans. Other
possible sites include new housing developments, repaired
fishing boats and infrastructure projects.

THE ASSISTANCE EFFORT ITSELF


4. (C) U.S. disaster relief efforts, led by the U.S.
military, had an immediate impact on affected areas in
Thailand. III MEF Commander, Lt. Gen. Robert Blackman, was
the commanding general of Combined Support Force 536 (CSF
536),which was based out of Utapao Thai Naval Air Station.
CSF 536 worked closely with the Embassy and JUSMAGTHAI to
ensure that requests for assistance were promptly addressed
and to assist coordination of relief from civilian agencies,
NGOs and corporate donors. The Royal Thai Armed Forces
granted the U.S. military blanket overflight clearances for
relief operations in the region, including for aircraft from
the USS Abraham Lincoln Battle Group which operated off
Sumatra. In addition to permitting our use of Utapao, the
Royal Thai Government integrated Thai officers into the CSF
staff where needed. During the height of operations, over
1800 USG personnel operated out of Utapao. We distributed
over 660,000 pounds of supplies within Thailand including
medicine, food, dry ice and body bags. USAF C-130s made
regular delivery runs from Utapao and Bangkok to affected
areas for time sensitive supplies while bulk shipments tended
to go overland. USN P-3s positioned at Utapao conducted
search and rescue missions in the region. Teams made up of
medical specialists from the CDC, the Armed Forces Research
Institute of Medical Science and the Joint POW/MIA Accounting
Command in Hawaii were also deployed to Thailand to assist
with victim identification. U.S. Navy SEALS and a
representative from the Office of Foreign Disaster Assistance
worked closely with Thai military units to search for the
remains of American and other victims of the disaster.
Embassy Bangkok provided 24-hour American Citizens Services
for weeks after the crisis to assist Americans, claim Amcit
remains and coordinate USG relief efforts and operated a
virtual Consulate in Phuket City to assist Americans. The
coordination among U.S. military and civilian officers
forward deployed in the Phuket area was a model of
cooperation. Longer-term assistance is being provided by
USAID in the form of replacement of small fishing boats and
the provision of start-up loans for the recovery of
small-scale aquaculture and tourism-related businesses.
Thailand is also eligible for a USD $150 million soft loan
facility OPIC is making available to tsunami-affected areas.
The Thai seek assistance in setting up a tsunami early
warning system and will welcome assurances from you that we
are providing technical assistance to help countries in the
Indian Ocean Basin establish a network.


THE BILATERAL RELATIONSHIP


5. (SBU) Bilateral relations with Thailand are excellent.
The goodwill generated by America's quick and massive
response to the tsunami is palpable. American businesses
have over $20 billion in direct investment in Thailand. The
United States is Thailand's largest export market and second
only to Japan as a foreign investor. U.S. visitors to
Thailand during the past few months have included former
Presidents Bush and Clinton, former Secretary Powell,
Governor Jeb Bush, Secretary Rumsfeld, Deputy Secretary
Zoellick, and then-Deputy Secretary of Defense Wolfowitz.


6. (SBU) Nonetheless, there are several points of friction.
Human rights remain a key concern. On October 25, 2004,
poorly trained Thai military and civilian security forces
forced nearly 1,300 Thai Muslim protesters into trucks to be
transported to a military base nearly three hours away. 78
protesters died en route. The Department's annual human
rights report, which in 2004 voiced concern over the lack of
accountability for approximately 1,300 extrajudicial killings
in 2003 during a "war on drugs" promoted by the Prime
Minister, rankles the Thai Government. The United States
also has a substantial (about USD 10 billion) trade deficit
with Thailand.


7. (C) Thailand's policy of "constructive engagement" with
the military junta in Burma and provision of economic
assistance to Rangoon is a source of continuing frustration
for us. The Thai government supports democracy in Burma but
maintains, not altogether convincingly, that engagement with
the SPDC is the only realistic approach it has to make
progress on the major cross-border flows of refugees, illegal
economic migrants, and methamphetamines it faces from Burma.
Recently PM Thaksin has voiced growing frustration with
Rangoon and his Ministers tell us that Thai policy may become
less favorable towards Burma.


8. (C) China's growing influence in Thailand and Southeast
Asia is evident in business, the arts, and the media. While
Thai military links with the United States are deeper and far
more apparent than Sino-Thai links, the Thai military has
increased contacts with the PLA and a number of Chinese
weapons systems in its arsenal. Recent visitors have found
PM Thaksin to be an engaging interlocutor when discussing
China -- he would likely welcome a chance to discuss China's
role in the region. He is there at the moment, celebrating
the 30th anniversary of diplomatic relations.

THE DOMESTIC SCENE -- PM THAKSIN'S DOMINATION OF THAI
POLITICS


9. (SBU) Prime Minister Thaksin was returned to power with
a strong majority in early February, winning 377 of the 500
seats in Parliament. His Thai Rak Thai (Thais Love Thais)
political party dominates domestic politics. This election
was the first time in Thai history that an elected civilian
Parliamentary government filled out its entire term and was
reelected. The Prime Minister's populist policies, public
relations savvy and a booming economy resonated well with the
Thai electorate. Thaksin comes from a prosperous Sino-Thai
family in Thailand's second largest city, Chiang Mai, and
placed first in his class at the National Police Academy. He
spent several years studying in the United States -- earning
a master's degree in Criminal Justice from Eastern Kentucky
University and a Doctorate in Criminology from Sam Houston
State University. (Thaksin jokingly likes to refer to
himself as an "honorary Texan.") After a few years with the
police, he left government service to run the family business
(Shinawatra Corporation or Shin Corp),which he turned into
Thailand's largest telecommunications company, making himself
a multi-billionaire in the process. Thaksin characterizes
himself as a "CEO Prime Minister" and portrays himself as a
decisive leader. Critics, with some justification, accuse
him of stifling dissent within his government and filling key
government positions with family members or classmates.
Following several meetings in Washington and the very
successful October 2003 Bangkok APEC Summit, Thaksin believes
that he enjoys a special relationship with the President.

VIOLENCE IN THE SOUTH


10. (C) Prime Minister Thaksin's biggest domestic challenge
is the unsettled security situation in the far southern part
of the country. Southern Thailand, in particular the
southernmost Muslim majority provinces of Pattani, Yala, and
Narathiwat, has experienced episodic violence since it was
incorporated into the Siamese Kingdom in 1902. However, 2004
witnessed a dramatic increase in the level of violence, with
over 500 people killed either by militants or by security
forces. Local Muslim separatist militants have attacked
symbols of Thai and Buddhist authority, and there continue to
be almost daily incidents of violence, notably even after the
tsunami disaster of December 26. Attacks most often involve

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isolated shootings of local officials, although increasingly
sophisticated bombing attacks have become more common. While
there is no credible evidence of Jemaah Islamiyah (JI) or
al-Qaeda direction of the violence, there is concern that
they might attempt to exploit the local violence for their
own purposes.


11. (C) Thaksin has recently acknowledged that the problem
in Thailand's south is not simply the work of criminal gangs
as he once declared, and that recent RTG policies towards the
South have failed to halt the violence. Thaksin recently
appointed a National Reconciliation Commission (NRC) headed
by highly respected former Prime Minister Anand Panyarachun
to look for alternative solutions to the long-running
insurgency, and has indicated that he might replace martial
law with something less harsh. Until recently, this violence
was directed primarily at RTG institutions with no evidence
of attacks directed towards foreign interests. On April 3,
however, simultaneous bombs exploded outside a French-owned
Carrefour supermarket and at an international airport,
killing two persons. Since then there have been no other
attacks on foreign-owned targets. You may wish to point to
our current efforts to improve human rights training for Thai
soldiers and officers who will rotate to the south. We are
working with U.S. experts to develop a multi-faceted training
program to educate enlisted soldiers, mid-level officers and
senior Thai leadership. Thaksin -- and most Thais -- are
sensitive about any perception that the U.S. wants to
establish a security presence in the south. Outrageous but
widely circulated rumors that the U.S. has fomented violence
in the South also need to be considered when discussing
offers of possible U.S. assistance.
THAILAND AND IRAQ


12. (C) Thailand has played an important role in supporting
the Global War on Terror. In addition to capturing terrorist
mastermind Hambali -- the link between the Jemaah Islamiah
and al Qaeda -- Thailand sent troops to both Afghanistan and
Iraq. Thailand dispatched two six-month deployments to Iraq
as part of OIF. In December 2003, two Thai soldiers were
killed by a car bomb while on duty in Karbala. Thailand's
second six-month deployment of 443 medics and engineers to
Iraq ended on September 20, 2004. While participation in OIF
has not caused the domestic furor in Thailand that it has in
other countries, Thaksin's critics have used Thailand's
deployments to Iraq against him. Several RTG officials have
told us that Thailand's deployments have been used by
militants to stir up dissent in the Muslim south. Recently,
CJCS General Myers sent a letter asking Thailand to consider
sending staff officers to man the OIF Multinational
Headquarters. Although in recent meetings with PACOM
Commander ADM Fallon and Deputy Secretary Zoellick Thaksin
had said that he would consider some "humanitarian" presence
in Iraq, at a private dinner wit me on May 12, Thaksin seemed
extremely sensitive to the issue, particularly the symbolism
that a Thai presence in Iraq would have among Muslims in
southern Thailand. Thaksin stressed that as an ally Thailand
supported the U.S. on Iraq, but asked us to be sensitive to
his own efforts to manage the situation in Thailand's south.

MILITARY COOPERATION


13. (C) The massive U.S. military response offering relief
to tsunami victims and our use of Utapao Thai Naval Air
Station as the hub for our relief efforts in Indonesia, Sri
Lanka and Thailand was possible in large part to our having
more than fifty years of close cooperation with the Thai
military. Thailand also affords the United States a unique
platform in Asia to work jointly with other Asian military
forces, including those from Japan and Indonesia, and to
conduct multinational peacekeeping, disaster relief, and
other exercises. Our largest exercise, Cobra Gold, is
America's only annual joint/combined multinational training
exercise in the Asia Pacific region. We are working with the
Thai military to build a National Training Facility (NTF) --
which could become a regional center -- to improve Thai
peacekeeping and counterterrorism capabilities. Further
expansion of our cooperative exercises with Thailand coupled
with our expected use of the NTF could go a long way toward
establishing a near-continuous U.S. presence in Southeast
Asia in support of our stability and security goals. We are
exploring at the working-level the possibility of improving
strategic talks with the Thai MFA and military to share views
on the region and to shape Thai thinking about proliferation,
terrorism, threats to the free flow of commerce and the
future role in the region of China and India.

FREE TRADE AGREEMENT (FTA)


14. (SBU) Our premier economic initiative with Thailand is
a bilateral FTA. Initiated in mid-2004, talks have
progressed, albeit at a moderate pace. The FTA we seek is
far more comprehensive than previous trade deals inked by
Thailand: areas of concern include inclusion in the FTA of
labor rights and environment safeguards, financial services,
and stronger intellectual property laws and enforcement.
Thailand is pressing us on improved access to the United
States for Thai workers. With other Southeast Asian
countries eager for an FTA with the United States, it is an
open question how long we will continue to devote the bulk of
our negotiating resources to the slow-moving Thai talks.

PROLIFERATION SECURITY INITIATIVE (PSI)

15 (C) After a year and a half of lobbying from the U.S.
and others, Thailand apparently has made the basic policy
decision to be more supportive of PSI and is moving through
the final steps towards endorsement of the PSI Statement of
Interdiction Principles (SOP). However, despite recent
assurances by both the Foreign Minister and Deputy Prime
Minister that official Thai endorsement of PSI awaits only
final Cabinet approval, the Royal Thai Government has failed
to move forward with the initiative. Prime Minister
Thaksin's final scrutiny of the decision will be key, and his
endorsement cannot be taken for granted given his mercurial
decision making style. Thai leaders told Secretary Rumsfeld
that Thailand will likely endorse PSI only after another
ASEAN nation besides Singapore does so.

F-16 SALE


16. (C) Thailand recently announced its plans to purchase
18 fighter aircraft to replace aging F-5s in the Royal Thai
Air Force (RTAF) fleet. Thaksin has made it clear that the
company winning the contract must be willing to engage in
barter/countertrade for Thai agricultural products. Bidders
on the contract include Sweden's Saab's Gripen fighter,
Russia's Sukhoi SU-30 and Lockheed Martin's F-16. Senior
U.S. leaders visiting Thailand, including Deputy Secretary
Zoellick and Secretary Rumsfeld have urged Thailand to
seriously consider Lockheed Martin's F-16. You also raised
the issue with FM Kantathi in Washington in May. The F-16 is
demonstrably a better aircraft and Lockheed Martin recently
made it clear that it is willing to offer a 100 percent
barter trade financing package. The Embassy believes that
continued pressure from senior U.S. officials like yourself
is essential for Lockheed Martin's prospects. It is our
belief that a transparent competition that takes into
consideration capability of the aircraft, interoperability
with U.S. forces, and cost would result in F-16 winning the
contract.

BURMA


17. (C) Although Thailand remains committed to its
engagement strategy with Burma -- and you can expect frequent
reference to the 2,400 kilometer long border the countries
share -- PM Thaksin has recently confided to us his
frustration with the SPDC. He will be prepared for you to
urge Thailand to take a tougher stance with Burma. FM
Kantathi will probably tell you that the SPDC will postpone
Burma's turn in the ASEAN chair rotation and could make such
an announcement in Vientiane.

REFUGEES


18. (SBU) We are in the latter stages of refugee
resettlement programs for 15,500 Hmong and about 2,500
Burmese. We recently reached agreement with the Thai on
starting another major resettlement effort which will draw
from the 145,000 Burmese currently residing in nine refugee
camps along the Thai-Burma border. This is likely to be a
multi-year project that will move tens of thousands of
Burmese refugees to the United States. Thai cooperation on
these programs, which serve the interests of both sides, has
so far been excellent.

IN CLOSING


19. (U) We are excited about your visit. The Thai are
honored that you are going out of your way to visit their
country on a trip that will take you to Tokyo, Seoul and
Beijing. We look forward to helping make your visit a
success.
BOYCE