UNCLAS SECTION 01 OF 02 KABUL 003852

SIPDIS

SIPDIS, SENSITIVE

STATE FOR SCA/FO (DAS GASTRIGHT), SCA/A, S/CRS, SCA/PB,
S/CT, EUR/RPM
STATE PASS TO USAID FOR AID A-AA/ANE MARK WARD, CDHA/DG,
NSC FOR AHARRIMAN
OSD FOR BREZINSKI
CENTCOM FOR CG CFC-A, CG CJTF-76, POLAD

E.O. 12958: N/A
TAGS: PREL PGOV EAID ETRN ELTN SNAR ASEC AF
SUBJECT: DEMARCHE REQUEST FOR JAPANESE RING ROAD



1. (SBU) Summary and Action Request: Representatives of
Embassy Economic Section, CFC-A, USAID/Afghanistan, and
U.S. Army Corps of Engineers Afghanistan Engineering
District (AED) have held several recent meetings with the
Japanese Embassy to discuss the status of suspended work on
their 114-kilometer section of the ring road. The Japanese
report that work is about to resume on Phase A of this
stretch; due to security-related cost overruns, however,
they are seeking additional funding to allow completion of
Phase B. Embassy requests that Washington demarche the GOJ
at a high level to ensure adequate and timely funding to
complete the project. The Japanese stressed that they have
legal constraints against contracting with a foreign
military to perform the work. End Summary.


2. (U) Representatives of Embassy Economic Section, CFC-A,
USAID/Afghanistan, and U.S. Army Corps of Engineers
Afghanistan Engineering District (AED) have held several
recent meetings with the Japanese Embassy to discuss the
status of suspended work on the 114-kilometer section of
the ring road that Japan is funding from KH Sec 2 - KH Sec

116. This stretch is the only section of the ring road
between Kabul and Herat that has experienced serious
delays; the section funded by Saudi Arabia will be
completed this year. [Background: the company previously
contracted by Japan to build this road abandoned work -
without having actually improved any part of the road - for
security reasons in April 2005. The road therefore remains
in extremely poor condition, passable only with difficulty
and very slow travel times.]


3. (SBU) CFC-A, USAID, and AED met Sunday August 20 with
the Japanese DCM and Economic Cooperation Officer. The

Japanese thanked us for clarifying a previous offer of USG
support and requested detailed information on what AED and
USAID could do "informally." AED gave the Japanese DCM a
sheet of suggested advisory technical services that AED
could supply on a pro bono basis. These included:

a) Advice and consultation (no cost) to the Government of
Japan during the different stages of the project.

b) Prior to issuing a contract tender, AED could advise on
the standard and special contract stipulations that are
applicable to construction in the region.

c) During tendering of the contract, AED is available to
provide advice regarding procurement methods in Afghanistan
and specifically in the region of the Ring Road.

d) During evaluation and negotiations, AED could provide
unit cost information regarding materials, supplies, and
labor.

e) After contract award, AED could offer advice on the
initial coordination that should occur with the local
villages, local sub-contractors, local Afghan Police and
Army, and with the regional U.S., Coalition and ISAF
forces.

AED is preparing a letter for signature by Commanding
General Eikenberry to cover a white paper that contains
more detailed information to assist the Japanese in
defining contract terms that will expedite the process and
enable road work to get underway soonest.


4. (SBU) The group then discussed the status of Japan's
effort to find a new contractor for this roadwork. Through
a competitive procurement, Japan has selected an Indian
firm (one with which USAID has worked successfully) to do
as much of the 114 kilometers as possible. Unfortunately,
security concerns have significantly increased the cost of
this road from the original estimate of 62 million dollars.

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For approximately this amount, the proposed contractor now
estimates that it can complete only half the length of the
road. Accordingly, the Japanese have divided their portion
of the road into Phase A and Phase B. Phase A covers
approximately half the total number of kilometers and will
include the portions of the road that are four-lane (those
closest to Kandahar City). They intend to proceed with
Phase A now; indeed, they believe that bringing U.S.
expertise to bear on the contracting for Phase A would
actually slow them down. Their best guess is that the
contracting process will be complete by late September, and
that roadwork will resume on Phase A, in October. The
Japanese Embassy has asked Tokyo to provide the remaining
funds required to allow them to complete Phase B.


5. (SBU) In a dinner hosted August 22 for the USAID Mission
Director, Econ Counselor, and the head of USAID's
Infrastructure Office, the Japanese DCM spoke frankly and
colloquially about the need for U.S. support for his
Embassy's request that Tokyo provide the additional funding
needed to complete Phase B and to do this in a timely
manner. He did not provide a cost estimate, but Post
assumes that it will be a lower cost than Phase A.


6. (SBU) Comment: The Japanese here understand the urgency
of completing the road. They also know that, now that work
has resumed on the Saudi-financed portion of the Ring Road
(KH Sec 116 - Sec 231), they are the odd man out. In
Post's opinion, an appropriately high-level demarche to
Tokyo might prove very helpful in convincing the Japanese
Ministries of Foreign Affairs and Finance to support their
Kabul Embassy's request for additional funding. One point,
however, emerged very clearly from the conversations
described above: while the Japanese Embassy welcomes the
offer of pro bono AED advisory assistance, they stressed
that the U.S. military cannot be used to actually carry out
the Japanese project.


7. (U) Action request: Embassy recommends the suggested
demarche to Tokyo be delivered at a high level and as soon
as possible.

NEUMANN