JORDAN'S GROUP OF ELEVEN INITIATIVE

UNCLAS AMMAN 007789

STATE PASS USTR

E.O. 12958: N/A
TAGS: EFIN ETRD ECON EAID JO
SUBJECT: JORDAN'S GROUP OF ELEVEN INITIATIVE


1. (SBU) SUMMARY: Jordan joined ten other countries on the
margin's of last month's UN General Assembly to launch a
"Group of Eleven." Nine lower middle income countries joined
Croatia and Pakistan to form a group dedicated to advance
mutual interests in the global economic, investment and trade
arena and to pursue a "targeted and results-oriented package
of additional assistance," according to the September 20
communiqu released in New York. Next steps include
establishing a ministerial-level secretariat, completing a
policy matrix by early next year, and holding a summit
meeting on the margins of the World Economic Forum meeting at
Jordan's Dead Sea in May 2007. END SUMMARY.


2. (U) On the margins of the UNGA last month, Jordan's King
Abdullah and ten other heads of state or their
representatives launched the "Group of Eleven/Lower-Middle
Income Countries Initiative." The initiative brings together
countries following "a path of prudent macroeconomic
management, economic liberalization, ... strengthening the
rule of law, building good governance, zero tolerance for
corruption, enhancing the role of civil society, and
expanding freedoms." According to the communique, the G-11
will focus on the burdens of high debt and high energy costs,
with the hope of increasing capital spending within their
economies. Targeted foreign assistance would then be
complemented by developed countries exploring ways to enhance
market access for G-11 countries, increase foreign direct
investment and increase technology transfer.


3. (SBU) A senior economic advisor in Jordan's Royal Court
provided Ecouns on September 28 with background on the G-11
initiative and next steps. The advisor explained that King
Abdullah launched the initiative as a way of bridging the G-8
process with that of the G-77. The G-11 brings together
countries that are determined to push ahead with economic
reforms, he said, despite the burdens of debt, high oil
costs, and damage from the 2004 Indian Ocean tsunami. NOTE:
The G-11 consists of Croatia, Ecuador, Georgia, Honduras,
Indonesia, Jordan, Morocco, Pakistan, Paraguay and Sri Lanka.
Poland was originally a member but withdrew and Tunisia
replaced it. END NOTE.


4. (SBU) The process was begun via Ministries of Foreign
Affairs, but later shifted to Economy Ministries. Senior
officials met in July to prepare for the leaders' event in
New York. The New York event was launched by the heads of
state of Pakistan, Sri Lanka, CROATIA and Jordan, as well as
by six Foreign Ministers. The 11 countries were chosen
because of their commitment to economic reforms, stability,
and improving freedom for their own societies.


5. (SBU) The group is currently developing a policy matrix.
After a technical meeting in November or December, the matrix
should be ready early in 2007. In addition, Jordan will
establish a ministerial-level secretariat which it will head
the first year. Jordan intends to hold a G-11 Summit on the
margins of the Dead Sea World Economic Forum meeting in late
May 2007 A G-11 meeting will be held on the margins of the
G-8 summit to pass on the recommendations developed.


6. (SBU) The advisor commented that the focus of the group's
work would initially be on debt and aid, targeting the World
Bank and the IMF, but not the Paris Club. Trade issues and
addressing the WTO will be considered later.


RUBINSTEIN