THE DEPUTY SECRETARY,S MAY 21 MEETING WITH

C O N F I D E N T I A L CAIRO 003227 SIPDIS NSC FOR SINGH E.O. 12958: DECL: 05/29/2016 TAGS: PGOV PREL ECON KDEM LE SUBJECT: THE DEPUTY SECRETARY,S MAY 21 MEETING WITH LEBANESE PM SINIORA ¶1. (U) Classified by: Minister-Counselor Michael H. Corbin, Reasons 1.4 (b) and (d) ¶2. (U) MAY 21, 2006; 12:45; Sharm El Sheikh, Egypt ¶3. (C) Participants: U.S. -------------- The Deputy Secretary NEA DAS Scott Carpenter D Executive Assistant Mike Matera D Senior Advisor Rich Mills D Special Assistant Aaron Jost LEBANON -------------- Prime Minister Fouad Siniora Prime Minister's staff ¶4. (C) Summary: The Deputy Secretary met briefly with Lebanese PM Siniora on the margins of the World Economic Forum in Sharm El Sheikh Egypt. The Deputy Secretary and PM Siniora discussed Siniora's recent trip to the U.S., economic and political reform, and U.S. support for the PM's reform program. End Summary. -------------- U.S. Trip -------------- ¶4. (C) Siniora informed the Deputy that he had had a "very successful" trip to the U.S., specifically citing meetings with National Security Advisor Hadley, the Department of Treasury and the U.S. Trade Representative. Lebanon appreciates U.S. assistance, Siniora stated. -------------- Reform -------------- ¶5. (C) In response to the Deputy's questions about progress on economic reform, Siniora said his government was seeking public buy-in for reform, focusing on improving relations with its trade partners (particularly the U.S.),and working to accede to the World Trade Organization (WTO). ¶6. (C) Siniora confirmed that his government was working with Parliament on reform, but noted that Lebanon was emerging from a transition "from one situation to another." In particular, the GOL was attempting to consolidate sovereignty over its territory. Shebaa Farms was of particular concern; "once" the Farms were declared to be Lebanese by the UN, he said, Israel would be required to withdraw under its UN Security Council resolution obligations. The ongoing "National Dialogue" was discussing important issues. Though the March 14 alliance holds two-thirds of the cabinet seats and the majority of the legislature, "Lebanese society does not ensure majority rule." Nonetheless, the parliament "is quite active in preparing to pass (reform) legislation," in particular on social and economic issues that would ease Lebanese entry to the WTO. ¶7. (C) Siniora also confirmed that his government was working to address Lebanon's high debt levels. Past governments had been unsuccessful in dealing with Lebanon's crushing debt burden, budget deficit, low revenue, and sluggish growth due to political problems. In contrast, his government had recently met with the U.S. Department of Treasury to discuss Lebanon's "major" economic reforms that were increasingly converging with the International Monetary Fund's expectations. Lebanon's success in pursuit of economic reforms, Siniora and the Deputy Secretary agreed, would be important not just for the Lebanon, but the region. ¶8. (C) The Deputy Secretary concluded the meeting by assuring the Prime Minister that the United States strongly supported his efforts. ¶9. (U) The Deputy Secretary' party has cleared this cable. RICCIARDONE