BASRAH PC MEMBER: SECURITY PROBLEMS IN BASRAH IMPEDES

C O N F I D E N T I A L SECTION 01 OF 02 BASRAH 000086 SIPDIS SIPDIS E.O. 12958: DECL: 5/27/2016 TAGS: PGOV PREL ECON EINV ETRD IZ SUBJECT: BASRAH PC MEMBER: SECURITY PROBLEMS IN BASRAH IMPEDES FOREIGN INVESTMENT REF: BASRAH 85 BASRAH 00000086 001.2 OF 002 CLASSIFIED BY: Mark Marrano, DEPUTY REGIONAL COORDINATOR, REO BASRAH, DEPARTMENT OF STATE. REASON: 1.4 (b),(d),(e) ¶1. (C) Summary: On May 25, the Basrah Deputy Regional Coordinator (DRC) and Poloff met with Munathil Abd Khanjar, Basrah Provincial Council (BPC) member and head of the Economic Committee. Munathil provided a bleak picture of economic development in Basrah, saying that deteriorating security portrayed on international news was detracting potential foreign investments. The BPC was too busy trying to replace Governor Mohammed Wahili to devote any attention to resolving the security crisis. End Summary. Poor Security in Basrah Dissuading Investment -------------- -- ¶2. (C) On May 25, the DRC and Poloff met with Munathil Abd Khanjar, Basrah Provincial Council member and head of the Economic Committee. Munathil, a political independent on the Basrah Islamic List (BIL),gave a levelheaded and frank assessment of the overall security situation in Basrah and how it was affecting the city. Poor security in Basrah was giving it a bad reputation internationally and dissuading potential investors. He recently returned from a trip to Jordan, where he had contacted a number of Arab countries and invited them to open branch offices in Basrah in an effort to increase foreign investments and boost economic development. He said he had invited a Jordanian company called Al Nassir to come to Basrah to open up a trash removal business during this trip abroad. He expressed disappointment that the company delayed their trip based on negative security reports of Basrah they saw in the news. ¶3. (C) If just one foreign company could be attracted to Basrah, Munathil said, he believed many more would follow. Expressing frustration, he said that a recent effort to negotiate a contract with a Kuwaiti company called "Blue Wave" to collect trash in Basrah fell through when the company's representative in Basrah received a death threat and fled the city. "We have the money," Munathil stressed, saying the contract would have provided lots of local jobs. ¶4. (C) According to Munathil, 75 percent of the security problem is due to unemployment in Basrah, and more jobs would cause security to improve drastically. Munathil said that he believed outside forces from neighboring countries were the primary cause behind the increase in violence in Basrah over the past months. He noted that Basrah is in close proximity to three other countries, Saudi Arabia, Kuwait, and Iran, and that each of these countries has its own interests; some of these countries are benefiting from the lack of security in Basrah (Comment: It was clear that Munathil meant Iran, as he had earlier stated he was trying to increase Kuwaiti and Saudi investments in Basrah. End Comment). ¶5. (C) Because all efforts to hire a foreign company for trash removal in Basrah had failed thus far, Munathil said that his committee was looking to purchase about 100 second-hand garbage trucks from Germany with BPC funds. Once the trucks arrived in Basrah, the BPC itself would hire workers to collect trash in the city. Munathil requested U.S. government assistance in transporting the garbage trucks from Europe to Umm Qasr port. Once the trucks arrived in port, he said, the BPC would be able to transport them to Basrah (Note: Umm Qasr port is about 35 miles southeast of Basrah. End Note). The DRC replied that we would look into the possibility of USG assistance. Violence Flourishes as BPC Obsesses on Governor -------------- -------------- ¶6. (C) The DRC stressed that the overall security situation in Basrah was something that the BPC would have to address seriously. Lack of security was not just affecting foreign investments, but degrading public trust in the council. Munathil replied that the BPC had been caught up in efforts to remove Governor Mohammed Wahili from his office for the past month and had not been able to make progress on other issues (see reftel). All of the projects put forward by the Economic Committee, he noted, needed BPC approval to go forward; so far, the BPC had not approved anything because it was only discussing the issue of the Governor. ¶7. (C) Comment: Munathil's assessment of the impact of the security situation on Basrah's economic development, as well as the inability of the BPC to move forward on important issues because of its obsession with replacing Governor Mohammed, was BASRAH 00000086 002.2 OF 002 spot-on. Moreover, Munathil was one of the first BPC members we have spoken to in a long time who seemed more concerned with delivering basic services to Basrah's population, like trash removal, than blaming the governor for all of the city's problems. Until overall security in Basrah improves, however, it is unlikely that Munathil and his colleagues will be able to make headway on picking up trash and attracting investors to Basrah. End comment. MARRANO