NEW SRI LANKAN RECONSTRUCTION AND DEVELOPMENT

UNCLAS SECTION 01 OF 02 COLOMBO 002099

SIPDIS

SENSITIVE

DEPT FOR SA/INS MGOWER; TREASURY FOR SCHUN; MCC FOR
DNASSIRY AND EBURKE

E.O. 12958: N/A
TAGS: EAID ECON CE ECONOMICS
SUBJECT: NEW SRI LANKAN RECONSTRUCTION AND DEVELOPMENT
AGENCY PRIORITIES: FIRST - FIGURE OUT WHO SITS WHERE


1. (SBU) Summary: Ambassador met with the newly formed Sri
Lankan Reconstruction and Development Agency's newly
appointed Chairman, Tiran Alles, and COO, Saliya
Wickramasuriya, on December 5. While neither offered
significant insight into the operations of this new entity,
which will absorb the duties currently held by the country's
tsunami and conflict-related agencies and task forces,

SIPDIS
Wickramasuriya noted that a bill will be presented in
parliament in January giving the agency "authority" status,
thus giving it significant political power. The Ambassador
reviewed US observations about the reality of concluding an
aid sharing deal with the LTTE. Alles confirmed that the
coastal "buffer zone" would be relaxed signficantly. The
Ambassador praised this decision, but said it was important
to move quickly on implementation. Alles will be a new
contact for the Embassy, while Wickramasuriya is well known
to us in his capacity as Chairman of the Board of Investment.
Both are highly capable managers with strong reputations.
The tasks confronting the new reconstruction agency, however,
are significant, and will not wait for organizational charts
and personnel shifts. The upcoming one year anniversary of
the tsunami and implementation of the relaxation of buffer
zone requirements will pose the agency's first major test.
End Summary.


2. (SBU) On December 5, the Ambassador paid a courtesy call
on the newly appointed chairman of the newly formed Sri
Lankan Reconstruction and Development Agency, Tiran Alles,
and Reconstruction and Development Agency COO-designate
Saliya Wickramasuriya. The agency will assume all the duties
currently held by the Task Force for Relief (TAFOR),the Task
Force for Rebuilding the Nation (TAFREN),and the Ministry of
Relief, Reconstruction and Rehabilitation (RRR). Alles, who
is currently (and will remain) head of the Sri Lankan airport
authority, and Wickramasuriya, who is immediate past Chairman
of Sri Lanka's Board of Investment (BOI),told the Ambassador
they had literally just come from a briefing on what their
empire consisted of and were very much in the initial stages
of setting up the new operation, including finding office
space and determining which GSL ministries and agencies would
come under their authority (the meeting took place in Alles'
private office in the building that houses his private firm).
While neither had much substance to share at this juncture,
both expressed a strong desire to continue a close working
relationship with the US on reconstruction issues, for both
tsunami- and war-affected areas.

SIPDIS


3. (SBU) Alles gave the Ambassador a copy of the presidential
decree that establishes the agency and names a board of
directors. Wickramasuriya explained that a bill would be
presented to parliament in January 2006 to give the new
entity "authority" status, thus giving it fairly broad powers
and control over Government agencies and operations. The
authority would seem to be President Rajapakse's instrument
to push more decisionmaking and operational arrangements to
the local level (Note: Alles suggested that the agency would
come under a newly formed Ministry of Nation-building and
Development, which would be headed by the President. End
Note). The President has previously blasted the tsunami
reconstruction efforts in particular as being too
"Colombo-centric." When the Ambassadors asked how the
authority would move forward on establishing a joint GSL-LTTE
aid distribution mechanism for the north-east (in place of
the now defunct Post Tsunami Management Operating Structure
(P-TOMS),aka the "Joint Mechanism"),Alles demurred, asking
the Ambassador, "what would you suggest?"


4. (SBU) The Ambassador said that the situation had to be
considered on two levels. On the political level, the
political atmosphere is becoming more and more "poisoned."
On the working-level, the LTTE and the working-level GSL
agencies had been working well together. Whether those
relationships are still fruitful is unclear. Whatever
solution is adopted, however, it almost certainly will have
to come from the bottom-up, as the current climate is not
conducive to conclusion of an overarching agreement. The
Ambassador outlined US concerns about the LTTE and described
the US Foreign Terrorist Organization designation process and
consequences. He suggested that working with the LTTE is
particularly difficult, because one always has to keep two
contradictory ideas in mind: the LTTE's brutal, thuggish
behavior on one hand and the fact that it exists as a reality
on the ground that has to be dealt with. Often people want
to go too far in one direction, suggesting that you either
engage the LTTE and forgive all their wrongdoing, or that you
don't deal with them at all because of the their terrorist
activities. Neither is the right answer, but neither is a
solution easily identifiable or implementable in the near
term.


5. (SBU) The USAID Mission Director also attended and briefed
Alles and Wickremasuriya about USAID post-tsunami assistance.
During this conversation, the Ambassador sought
clarification about the status of the 100m/200m coastal
conservation "buffer zone" that has created signficant
confusion and delays in the permanent housing rebuilding
process, noting that the President had told him the buffer
zone would be "relaxed." Alles said it would be relaxed
considerably, but the final details were still to be worked
out. Ambassador suggested that whatever is done, it was
critical that the decision be broadcast as clearly as
possible, as widely as possible, to ensure that interested
parties are able to move ahead quickly.


6. (SBU) Comment: Alles has not previously been a main
Embassy contact, though his work as Chairman of Airport
Services has been positively highlighted recently as the
airport has gone through a significant expansion and upgrade.
Alles is also rumored to be a close confidant of the
President, and is reportedly a liaision with the LTTE (this
is unconfirmed and he did not discuss it with the Ambassador
during this meeting). Wickramsuriya is well and favorably
known to the Embassy in his prior capacity as Chairman of the
Board of Investment. He has a strong private sector
background, having spent the bulk of his career with the
petroleum giant Schlumberger. While having two such capable
people at the helm should help the organization overall,
there are numerous issues confronting the agency that need to
be sorted out quickly. There will not be time for a top-down
review and restructuring, while keeping its main work on
hold. The implementation of a relaxed buffer zone policy and
the first anniversary of the tsunami will prove major tests
for the new agency in just its first few weeks of operation.
End Comment
LUNSTEAD