AMBASSADOR'S INTRODUCTORY CALL ON PRIME MINISTER

C O N F I D E N T I A L SECTION 01 OF 02 BAKU 000992 SIPDIS SIPDIS E.O. 12958: DECL: 07/05/2016 TAGS: PREL PGOV PHUM ETRD ECON KISL IR AJ SUBJECT: AMBASSADOR'S INTRODUCTORY CALL ON PRIME MINISTER RASIZADE Classified By: Ambassador Anne E. Derse, reasons 1.4 (b,d). ¶1. (C) Summary: During the Ambassador's July 4 introductory call, Prime Minister Rasizade urged the U.S. to consider the root causes of terrorism. The Ambassador responded that U.S. policy focuses on eliminating terrorism by giving people hope in the future, and urged Azerbaijan, as Chair of the OIC Foreign Ministers Conference, to encourage tolerance and moderation. The Prime Minister welcomed U.S. interest in promoting global energy security, and sought U.S. support for the Kars-Alkhalkalaki-Tbilisi-Baku railroad, pitching it as an energy transport issue. He expressed concern about U.S. financial assistance to the so-called Nagorno-Karabakh Republic and made an implicit plea for greater U.S. action to resolve the Nagorno-Karabakh conflict. He also warned that Iran was trying to export its Islamic revolution to Azerbaijan. The Prime Minster agreed that continued political and economic reform was necessary for Azerbaijan's long-term prosperity. End summary. ¶2. (C) During her July 4 introductory call on Prime Minister Artur Rasizade, the Ambassador reviewed U.S. priorities for the bilateral relationship: global and regional security, energy security, and reform. She thanked the Prime Minister for Azerbaijan's staunch support in the Global War on Terrorism and offered U.S. support for Azerbaijan's efforts to bring Caspian gas to European markets. She urged the Prime Minister to continue Azerbaijan's political and economic reform efforts, noting that speedy progress toward WTO accession could play a key role in diversifying Azerbaijan's economy. ¶3. (C) While affirming Azerbaijan's support for U.S.-led efforts to combat terrorism, the Prime Minister also urged the U.S. to think about the reasons behind terrorism. He rued the tendency of countries -- not the United States, he pointedly noted -- to connect terrorism to Islam, and said the world needs to think instead about the injustices that lead teenagers to become martyrs. The Ambassador thanked the Prime Minister for his views, noting that Azerbaijan -- as a secular, reform-minded Muslim country deeply engaged in combating global terrorism -- brings a unique perspective to the issue. The Ambassador said that President Bush had made clear in many public statements that Islam is one of the world's great religions. United States foreign policy focuses on eliminating the causes of terrorism by giving people hope in the future. Azerbaijan, as Chair of the OIC Foreign Ministers Conference, can play an important role in furthering this message by encouraging tolerance and moderation. ¶4. (C) Noting U.S. Vice President Cheney's remarks on energy in Vilnius, the Prime Minister told the Ambassador that Azerbaijan's energy projects are growing in importance. He welcomed U.S. support for Azerbaijan's efforts to bring Caspian gas to European markets, and said the Cabinet of Ministers had created a new office for Energy Security in order to further increase regional cooperation on energy issues. While Azerbaijan and Kazakhstan were working closely (as evidenced by the June 2006 Inter-Governmental Agreement), the Prime Minister said that relations with Turkmenistan were more difficult. Turkmenistan, he said, wants to export its natural gas via Russia. ¶5. (C) The Prime Minister asked for U.S. support for the planned Kars-Alkhalkalaki-Tbilisi-Baku railroad, expressing concern that the U.S. Congress had passed legislation prohibiting Ex-Im financing for the railroad. Given U.S. support for the export of Azerbaijan's energy resources, the Prime Minister said he could not explain to the Azerbaijani people U.S. Congressional opposition to the planned railroad. Noting that the Bush Administration does not support this legislation, the Ambassador said that the Administration views the proposed railroad as a commercial undertaking among sovereign states. However, we strongly support regional integration in the Caucasus. ¶6. (C) The Prime Minister also asked the Ambassador why the U.S. Congress had appropriated USD 5 million in assistance to the so-called Nagorno-Karabakh Republic, when the U.S. Congress had not appropriated assistance funds for other break-away regions in the Caucasus, such as Abkhazia. The Prime Minister made an implicit plea for greater U.S. action to resolve the Nagorno-Karabakh conflict. While the OSCE Minsk Group Co-Chairs had always stressed that the parties themselves must agree on the solution to the conflict, the situation is different now with the two sides deadlocked. The Prime Minister said that Azerbaijan wants peace. The Ambassador responded that the U.S. and the other Co-Chairs are ready to re-engage in the peace process; the parties know BAKU 00000992 002 OF 002 the core principles and must tell us whether they can be adopted or can be adjusted to form the basis for a lasting agreement. Affirming U.S. support for the territorial integrity of Azerbaijan, the Ambassador said that U.S. assistance to the so-called Nagorno-Karabakh Republic is purely humanitarian in nature, and determined by the U.S. Congress. ¶7. (C) Briefing the Ambassador on Azerbaijan's "tough neighborhood," the Prime Minister said that Iran is working actively to export its Islamic revolution to Azerbaijan, using its intelligence services and humanitarian assistance programs. While Azerbaijan definitely does not want an Islamic revolution, he said Azerbaijan also does not want to break relations with Iran. "We depend on Iran," the Prime Minister said, particularly for energy supplies to the Azerbaijani exclave of Nakhchivan. He said that Iran does not like the fact that Azerbaijan maintains good relations with the United States and Israel. Azerbaijan, however, highly values its relationship with the United States, particularly as a safeguard of Azerbaijan's stability and independence. For these reasons, the Prime Minister said, Azerbaijan must think carefully about all foreign policy issues. ¶8. (C) The Prime Minister agreed that continued political and economic reform must be a priority, but said that the Government of Azerbaijan alone cannot make this happen. The people of Azerbaijan must also be involved, and reform will take time. We have "our way" of doing things, he said. The Prime Minister also agreed that Azerbaijan must improve its investment climate and develop the non-energy sectors. He promised that Azerbaijan would "do its best" on WTO accession and said continued U.S. support for Azerbaijan's accession would be extremely useful. In response to the Prime Minister's complaint that Armenia received Millennium Challenge Account (MCA) funds, the Ambassador said that countries are selected to receive MCA funds based on objective criteria. The reforms initiated as part of the WTO accession process would help Azerbaijan meet this criteria. The Ambassador offered to work with the GOAJ to identify areas where progress was required to meet MCA criteria. DERSE