GUEBUZA UPBEAT AT AMBASSADOR'S COURTESY CALL

C O N F I D E N T I A L SECTION 01 OF 02 MAPUTO 000248 SIPDIS STATE FOR AF/FO AND AF/S - TREGER MCC FOR HARRINGTON AND GAULL E.O. 12958: DECL: 02/24/10 TAGS: PGOV PREL KDEM EINV MZ SUBJECT: GUEBUZA UPBEAT AT AMBASSADOR'S COURTESY CALL Classified by Ambassador Helen La Lime for Reason 1.4(d) ¶1. (C) Summary: In the Ambassador's courtesy call, a confident and relaxed President Guebuza expressed appreciation for USG assistance, particularly our support for democracy, fighting HIV/AIDS, promoting rural development, and defense. Guebuza highlighted the need to take action against rural poverty and change the mindset that led to corruption, "bureaucratism," the spirit of "letting things slide", and criminality. The Ambassador outlined USG activities in Mozambique. Guebuza expressed interest in sending a Mozambican delegation to the Corporate Council on Africa's June Business Summit in Baltimore. He raised the Nyati Beach Lodge investment dispute as a concern, and he reacted favorably to the Ambassador's expression of hope that it could be resolved favorably and quickly. Guebuza's government appears to have gotten off to a good start, though we understand that high public expectations may be a challenge. End Summary. ¶2. (U) Ambassador La Lime paid a courtesy call on President Guebuza at the GRM's request on February 23. Guebuza was accompanied by Minister in the Presidency for Diplomatic Affairs Francisco Madeira, Vice Foreign Minister Henrique Banze, and Presidential Private Secretary Renato Matusse. The Ambassador was accompanied by the DCM (notetaker). ¶3. (C) Guebuza started the meeting by expressing his thanks to the USG and President Bush for USG support. He emphasized the importance of our "exemplary" support for Mozambican democracy and for fighting diseases like HIV/AIDS. He added that Mozambique's economy would not be where it was today without USG assistance. He showed himself well-briefed, praising nontraditional USG efforts such as AGOA, OPIC, and the MCA, which he said would help Mozambique speed up its fight against rural poverty. In a reference to the ongoing investment dispute involving the OPIC-supported Nyati Beach Lodge, he expressed regret that OPIC had had problems in Mozambique. He did not go into details, but said the problems were due in part to the country's "bureaucratic problems" and "our structure." He thanked the USG for support during the recent elections period and also for support in sensitive areas like training and equipment for defense. He repeated a theme from his July trip to Washington in saying �00A;that his government would respect Mozambique's international commitments and continue the general policy line of the Chissano government. He expressed interest in continuing to deepen the bilateral relationship. ¶4. (SBU) Guebuza then gave an overview of his aims for his government. He emphasized his desire to fight poverty, saying that this would require a change in attitudes, which in turn would help Mozambique better use its human and natural resources and donor assistance. He highlighted the need to fight corruption, "bureaucratism," the spirit of letting things slide ("deixa-andar"),and criminality. He expressed optimism that the Mozambican people were ready to contribute. ¶5. (SBU) Guebuza stressed the importance of rural development. He said he would push for rural infrastructure, take steps to stimulate rural markets such as creating a rural bank, and increase the quality of the rural labor force through training. He noted that Mozambican universities lacked the sort of courses on rural development that were found in U.S. universities, and he said he wanted Mozambique's intelligentsia to focus its talents on fighting rural poverty. ¶6. (C) The Ambassador responded by noting that Guebuza's impact was already being felt. An Embassy FSN had reported that morning that he had renewed his driver's license in 48 hours without paying any bribes; a pleased Guebuza said he assumed this had not been the case before. The Ambassador reviewed the USG presence and activities in Mozambique. Guebuza responded favorably to the Ambassador's mention of the Peace Corps, saying he had seen many of its volunteers in rural areas. She noted the increase in USG assistance levels in recent years, emphasizing the President's Emergency Plan for AIDS Reduction and the Millennium Challenge Account. She said that Mozambique had not taken much advantage of AGOA benefits but said that the Corporate Council on Africa wanted to increase its relationship with the country. She added that the Council's June 21-24 summit in Baltimore would be an opportunity for the new government to increase Mozambique's international profile. She also noted our interest in obtaining a site for a New Embassy Compound and explained that we would need certain rights to the land as part of our lease. ¶7. (SBU) Guebuza expressed interest in sending a Mozambican delegation that would include ministers to the CCA event. He did not know if he would be able to attend but said he needed to get to the U.S. at some point. ¶8. (C) The Ambassador raised the Nyati Beach Lodge investment dispute, to which Guebuza had referred earlier. She also previewed the March 2 visit of Assistant Secretary of State Newman and suggested that she might raise the issue. She noted that the dispute was hurting the country's image and expressed hope that it could be resolved favorably and quickly. Guebuza's response was an understanding, "Yes, yes." ¶9. (C) Comment: Guebuza appeared confident and more relaxed than at any time in recent months. He seemed well-briefed on USG programs and enthusiastic about deepening our relationship. He was aware of the importance to the bilateral relationship of the Nyati dispute. His reaction when the Ambassador returned to the issue was much more positive than in his January meeting with charge, OPIC Senior Adviser Shore, and the U.S. investor. ¶10. (C) Comment Continued: Several of Guebuza's ministers appear to have gotten off to good starts, and we are hearing anecdotal evidence of service to the public improving. Offices are opening at their scheduled hours, and ministers are carrying out surprise inspections. One minister even locked out all employees who arrived after the 7:30 opening time. We also have heard that public expectations are high, which may be a challenge as Guebuza settles in. End Comment. LA LIME