IRAQI TRADE MINISTER ON RECONCILIATION

C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 004253

SIPDIS

SIPDIS

E.O. 12958: DECL: 11/14/2016
TAGS: EINV IZ PGOV PREL
SUBJECT: IRAQI TRADE MINISTER ON RECONCILIATION

Classified By: Ambassador Zalmay Khalilzad for reasons 1.4 (b) and (d)


1. (C) Summary: During a November 9 dinner with Ambassador
Khalilzad, Iraqi Trade Minister Abd al-Falah al-Sudani set
forth an unusually conciliatory view of Iraqi reconciliation
encompassing Iraqi and regional actors. Al-Sudani has not
developed details and or domestic allies for his ideas; the
Ambassador urged him to do so and offered U.S. help. End
Summary.

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Involve Regional Actors
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2. (C) In response to al-Sudani's question about how U.S.
election results will affect Iraq, the Ambassador predicted
that the USG and U.S. public will be increasingly looking for
signs that Iraqis are working together and making progress.


3. (C) Al-Sudani, from the Shiite Dawa party, told the
Ambassador he believes that Iran and other regional actors
must be part of Iraqi reconciliation. Iran can make life in
Iraq difficult or easier, he reasoned. However, al-Sudani
asserted that Saudi Arabia, Turkey, Syria and even Israel
have a role to play in Iraqi reconciliation. Al-Sudani cited
the regional agreement on Lebanon as a possible model. The
goal, he said, is for other countries to commit to stop
supporting violent groups in Iraq.

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Start With a Ceasefire
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4. (C) Al-Sudani noted that Iraq's October "Ramadan
Agreement" among political bloc leaders has so far failed to
produce results because both Shiites and Sunnis had
"unfinished business" they felt could be solved through
violence.


5. (C) Al-Sudani said a ceasefire in Iraq would be a first
step but conceded that this would be very difficult. He
hopes consultations could take place on issues including
federalism, power sharing between the GOI and local entities
and hydrocarbons. In addition, al-Sundani asserted that
minorities should be given some degree of veto power in order
to reassure them that their rights would be safeguarded.


6. (C) The U.S. and UK could serve as ceasefire "guarantors"
and provide financial assistance; Iran could also provide
financial assistance.

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Sequencing
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7. (C) The Ambassador pressed al-Sudani on sequencing. The
U.S. has put a great deal of thought into this process, the
Ambassador said, and into setting conditions for such an
agreement. Iraqis first must resolve a mix of issues,
including the ones al-Sudani identified. This would bring
stability and set the stage for amnesty, completing the
Constitution, and complete transfer of security
responsibility to the GOI.


8. (C) Al-Sudani replied that domestic and regional efforts
should be pursued simultaneously. Regionally, he believes
the process should begin as a series of Iraqi-led regional
bilateral consultations and understandings, melding into
wider consultations as consensus emerge. The simultaneous
domestic political task, as he sees it, is to show all
factions how they benefit from reconciliation.


9. (C) Al-Sudani said Baathists would fight as long as they
feel "excluded." He cited South Africa as a model for
dealing with Baathists, saying this should be a process that
proceeds in stages of up to two years. The GOI could
indemnify victims of Baathist violence, a policy he maintains
is rooted in sharia. If Baathist violence diminishes, the
U.S. should be prepared to respond by reducing troop presence.

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Iraqi Shia Alliance
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10. (C) Al-Sudani believes that his Iraqi Shia Alliance
(UIA) would be willing to develop such a proposal.
Thereafter, it could be presented to other Iraqi parties.
Al-Sudani concluded, remarkably, that his fellow Shiites had
to move forward on reconciliation quickly, before they become
too accustomed to power and reluctant to share it. The
Ambassador strongly endorsed al-Sudani's approach. He urged
al-Sudani to further develop the proposal and support for it,
and offered U.S. help.

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Investment Issues
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11. (SBU) Al-Sudani named Director General (DG) Abdul Hadi
as his point of contact on investment issues at the Ministry
of Trade. The Ambassador also noted that USAID's Izdihar
project is working with Deputy Planning Minister Fayk Rasool
on developing implementing regulations for the investment law
that recently passed October 10. Al-Sudani said he believed
Izdihar's contract was set to expire soon. (NOTE: Izdihar's
funding was renewed in the past couple of months after a
hiatus. Izdihar continues to provide technical assistance to
the GOI on investment and World Trade Organization (WTO)
issues, among others. Minister al-Sudani appeared unaware of
this development. END NOTE).
Speckhard