MGLE01: SCENESETTER FOR CODEL DODD

UNCLAS BEIRUT 001164

SIPDIS

SENSITIVE

SIPDIS

DEPT FOR H, NEA/ELA

E.O. 12958: N/A
TAGS: OREP PGOV PREL LE
SUBJECT: MGLE01: SCENESETTER FOR CODEL DODD

SUMMARY
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1. (SBU) The current political situation in Lebanon is
highly uncertain: the National Dialogue process, which
raised expectations for significant political progress when
it began six weeks ago, appears to have run its course.
The rivalry between the pro-reform "March 14" coalition
(consisting of blocs led by Saad Hariri, Walid Jumblatt and
Samir Ja'ja') and the pro-Syrian "March 8" coalition (led
by Hizballah, Amal and Michel Aoun) is as heated as ever.
Prime Minister Fouad Siniora, who leads the pro-reform
government, claims a mandate to pursue the goals of "March
14," but the way forward has not been easy since he took
office in July 2005. Lebanese sovereignty has been under
attack during his term in office, and "governance by
consensus" has limited Siniora's ability to push for
closure in the Hariri assassination case. The government
has moved ahead gradually with plans for reform --
specifically on the economic and electoral fronts -- but
there is well-organized resistance to these efforts which
have not moved substantially forward. Pro-Syrian President
Emile Lahoud remains in office in defiance of UNSCR 1559
and is an additional obstacle to reform. PM Siniora and
four of his ministers are visiting Washington from April
17-20 to discuss the government's reform efforts and U.S.
support for the country in its transition to democracy.
End summary.

A PRO-REFORM PM HEADING
A "MADE IN LEBANON" CABINET
--------------


2. (SBU) Fouad Siniora, longtime associate and political
supporter of assassinated Prime Minister Rafiq Hariri, took
office as Prime Minister in July 2005. Supporting the
government is a 72-member (out of 128) parliamentary
majority, elected in May-June 2005 and led by Hariri's son,
Sa'ad. Commencing work just months after the withdrawal of
Syria's military and overt intelligence personnel from
Lebanon, Siniora's cabinet was the first genuinely "made in
Lebanon" cabinet after nearly 30 years of de facto rule
from Damascus.


3. (SBU) The pro-reform, pro-sovereignty March 14
coalition is led by the younger Hariri, along with Druze
leader Walid Jumblatt, and Lebanese Forces leader Samir
Ja'ja' (this coalition takes its name from the massive
rally held in Beirut one month after the elder Hariri's
murder on February 14, 2005). The coalition's stated
political objectives are: determining the truth and meting
out justice in the Hariri assassination, restoring
Lebanon's sovereignty, and pursuing much-needed, but
long-delayed reforms.


4. (SBU) Facing the pro-reform bloc is the "March 8"
coalition, composed of the Shia movements Hizballah, led by
Hassan Nasrallah, and Amal, led by Speaker of Parliament
Nabih Berri. Free Patiotic Movement leader Michel Aoun,
with 21 parliamentary seats representing the traditionally
powerful Maronite community, often sides with Hizballah and
Amal on political issues and entered into a "cooperative
alliance" with Hizballah on February 6, with the issuance
of a joint communique that outlined common political
goals. Michel Aoun has made clear on numerous occasions
his desire to be Lebanon's next president.

AN OBSTACLE COURSE TO THE TRUTH AND SOVEREIGNTY
-------------- --


5. (SBU) Despite the government's advantage of a strong
parliamentary majority, its room for maneuver is limited.
The uniqueness of post-civil war Lebanese politics makes
the Siniora Cabinet more like a miniature Parliament (minus
Michel Aoun's bloc) than an executive body controlled by
the parliamentary majority. In it are ministers belonging
to, or at least serving at the pleasure of, Hizballah and
the Amal Movement, which are pro-Syrian and opponents of the
"March 14" coalition.


6. (SBU) This situation has made it difficult for Siniora
to pursue closure in the Hariri case, the truth of which is
surely not to the Asad regime's taste. He was able to win
grudging acquiescence from his Hizballah and Amal cabinet
ministers in calling for an extension of the initial
mandate of the UN International Independent Investigation
Commission (UNIIIC). Later, the Amal/Hizballah alliance
answered him with a crippling, seven week boycott of the
Cabinet from December 12 until early February. Their
pretext was that the Prime Minister had asked the UN,
without full Cabinet approval, for a broadening of the
UNIIIC mandate to include all terrorist incidents since
October 2004 and for the creation of an international
tribunal to try suspects in the Hariri assassination.
Since February, the full Cabinet has met but friction is
never far below the surface.

CAUSES OF INSTABILITY
--------------


7. (SBU) Throughout 2005, Lebanon faced an ongoing
terrorist campaign that appeared aimed at eliminating some
of Syria's critics, spreading fear, discrediting the
Lebanese government, and ultimately rolling back Lebanon's
recent gains in sovereignty. The September 2005 attempted
assassination of television broadcaster May Chidiac, the
December 2005 assassination of MP and leading journalist
Gebran Tueni, and three other bombings in Beirut and its
surroundings since July undercut confidence in the
government. The response of the security sector has been
slow, and a deadlock between Siniora and President Lahoud
prevents it from more effective action.


8. (SBU) By closing its border crossings with Lebanon in
August 2005, the Syrian regime demonstrated its willingness
to put an economic stranglehold on Lebanon when it saw
fit. Even more importantly, Syria's ally Hizballah remains
a state-within-a-state, with an armed force that is a match
for the Lebanese Armed Forces. Hizballah has ignored UNSCR
1559's requirement for disarmament of all militias and
reserves the right to make decisions on inciting violence
through its conduct of paramilitary operations along the
Blue Line between Lebanon and Israel. Hizballah justifies
its violent actions by claiming that is a legitimate
"resistance" to Israeli occupation of the Shebaa Farms,
which it and many other Lebanese parties claim to be
Lebanese territory. This claim is not widely shared by the
international community.

PUSHING AHEAD ON REFORM...
--------------


9. (SBU) Prime Minister Siniora, seeing an opportunity to
break a deadlock on economic policy that existed for years
between President Lahoud and then-Prime Minister Rafiq
Hariri, assembled a capable economic team and forged ahead
in drafting a detailed reform program. Its goal is to
bring under control Lebanon's mammoth debt-to-GDP ratio, a
problem that cannot afford to wait. Beyond fiscal
adjustment, the government's plan also aims at increasing
economic growth and employment by making Lebanon an easier
place in which to do business. Finally, it aims at
building social safety nets that make sound economic policy
politically viable over the long term.


10. (SBU) The "Core Group" of friends of Lebanon --
including the United States, France, the United Kingdom,
the UN, and the World Bank -- has made it clear that
Lebanon enjoys an unprecedented window of opportunity for
support for a credible and sustainable reform program. The
government's economic team appears to understand this well,
and has worked, on the one hand, to develop a detailed
program that meets Core Group expectations. On the other
hand, it has steadily sought domestic political "buy-in" to
the program, starting within the Cabinet and with the goal
of including all political players capable of blocking it.
One significant problem is that President Lahoud can throw
a monkey wrench into these many moving parts, in economic
reform as well as the security sector.


11. (SBU) The Siniora government recognizes that political
reform must accompany economic reform, and the prime
minister has made reform of the electoral system a
priority. While still a work in progress, the draft
electoral law as currently written will introduce important
reforms, including the establishment of an independent
commission to oversee elections (in place of an Interior
Minister who is likely to be running for election
himself).


12. (SBU) Changing the electoral status quo will not
necessarily benefit the "March 14" parliamentary majority
in the next election. PM Siniora will face a challenge in
shepherding a draft law, once it is finally produced,
through his cabinet and on to the Parliament. For now, he
simply needs a final draft law.

REFORM AT A CROSSROADS
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13. (SBU) Lebanon is presently at a critical juncture. A
series of parliamentary "national dialogue talks" -- with
Siniora, as well as Aoun and the leadership of Hizballah
and Amal at the table -- has tentatively agreed to ask
Syria to demarcate the Syrian-Lebanese border, establish
normal diplomatic relations between the two countries, and
restrict armed Palestinians to the camps. However, the
talks show no sign of cutting through the immediate impasse
over the Lahoud presidency, as well as the longer-term
problem of Hizballah's disarmament.


14. (SBU) The next meeting of the National Dialogue is
scheduled for April 28, but no one is quite sure whether
further progress is possible. What comes after the
conclusion of the National Dialogue is also uncertain. The
pro-reform government faces numerous challenges and much
will depend on moving forward with political and economic
reform and the resulting support of the Lebanese people.
FELTMAN