IRAQIS TREADING CAUTIOUSLY ON ARAB LEAGUE BOYCOTT

C O N F I D E N T I A L BAGHDAD 000861 SIPDIS SIPDIS E.O. 12958: DECL: 03/16/2016 TAGS: ECON ETRD KBCT PGOV PREL IS IZ SUBJECT: IRAQIS TREADING CAUTIOUSLY ON ARAB LEAGUE BOYCOTT DIPLOMACY REF: BAGHDAD 765 (NOTAL) Classified By: EconMinCouns Delare for reasons 1.4 (b) and (d). ¶1. (C) Econoff on March 15 met with Hikmat M. Abdullah, Minister Plenipotentiary and Director of the Arab League Boycott Office within the Ministry of Foreign Affairs (MFA), to discuss removal of the Arab League Boycott (ALB) from Iraqi law. Hikmat said Iraqi officials understand the negative economic consequences of continuing the boycott, especially in light of GOI interest in WTO accession. He claimed that enforcement of the boycott is getting weaker every year. However, he argued that repealing the boycott from Iraqi law at this time would likely lead to a negative public reaction that Iraq does not need. -------------- Political Consequences -------------- ¶2. (C) Director Hikmat had additional objections to repealing the boycott. He said that under current political conditions, Iraq could be viewed as caving to U.S. and Israeli pressure. He also mentioned the significance of the sizable Palestinian population in Iraq. Hikmat predicted that all Iraqis, regardless of sect or region, would react negatively to a public repeal of the ALB. He said for now Iraq should leave the ALB law alone while considering ways to gradually repeal it. -------------- Getting Out of a Corner -------------- ¶3. (C) Hikmat said that at the most recent ALB meeting, in November 2005 in Damascus, attendees from other countries accused Iraq of having Israeli goods and threatened to put this accusation into official meeting proceedings. GOI officials told the meeting that Iraq does not import Israeli products and does not have any in the country. When some at the ALB meeting alleged that the U.S. military in Iraq uses Israeli products, Hikmat told his interlocutors that this is not an issue the GOI is interested in pursuing with the USG. Hikmat told us the condition for removing statements from the official proceedings was that the discussion of Iraq's ALB enforcement would continue at the May 2006 ALB meeting in Damascus. ¶4. (C) Hikmat admitted that Iraq imports Israeli products. He has requested guidance from the Prime Minister's office (reftel) on how to respond to queries at the next Damascus meeting, as well as how to proceed with the ALB as Iraq simultaneously moves to achieve WTO status. KHALILZAD