CAMBODIA: DAS JOHN'S REINFORCES BILATERAL

C O N F I D E N T I A L SECTION 01 OF 03 PHNOM PENH 000894 SIPDIS SIPDIS STATE FOR EAP/MLS; GENEVA FOR RMA E.O. 12958: DECL: 05/04/2016 TAGS: PREL KDEM KJUS PHUM EAID CB SUBJECT: CAMBODIA: DAS JOHN'S REINFORCES BILATERAL RELATIONS WITH FOREIGN MINISTER Classified By: A/DCM Margaret McKean; Reason 1.5 (b),(d) ¶1. (C) Summary. In a May 4 discussion with visiting DAS Eric John, FM Hor Namhong lauded US-Cambodia bilateral relations and said Cambodia would seriously consider DAS John's request that the RGC support Guatemala's candidacy for the UNSC. The FM was open on Burma and prospects for democratic change. He pushed Cambodian membership in APEC and suggested that Cambodia join the ASEAN Seven leaders on the margins of the APEC Summit in Hanoi. The FM requested that the United States consider joining the East Asian Summit. DAS John noted that Cambodia cannot compete economically in Asia on the basis of price; Cambodia's best opportunity is to capitalize on respect for labor and human rights -- and to continue implementing reforms that reinforce democratic institutions. He pressed Cambodia to do more on Burma, both publicly and privately. End Summary. MFA: Cambodia in a Good Place Politically, Economically -------------- -------------- ¶2. (C) During DAS John's May 4 meeting with Minister of Foreign Affairs Hor Namhong, the FM said 2006 had been marked by positive developments in the political and economic environments. Politically, the government's cooperation with opposition leader Sam Rainsy has contributed to a more open political dialogue, defamation is being decriminalized, the RGC and SRP are working on the land dispute issue -- all of which is good for Cambodia's political stability. Economically, 2005 growth estimates run at 8-9 percent, the FM continued, stronger than the country's 2004 performance (over 7 percent) as well as the period 1999-2003 (over 6 percent). Hor Namhong attributed the reasons behind 2005's strong showing as good economic management, increased tourism, steady garment exports and (for the first time in recent history) the export of Cambodia's rice surplus as a result of good rains. ¶3. (C) Cambodia's bilateral relationship with the United States is also on a positive track, affirmed the Foreign Minister, who listed counterterrorism, education, and health as areas of excellent cooperation. He welcomed the recent announcement of the Peace Corps program, noting that the PC would be of assistance in poverty reduction -- particularly in the rural areas. Cambodia would like to sign the Trade and Investment Framework Agreement (TIFA) as soon as possible, he said, which will lead to the future implementation of the Enterprise for ASEAN Initiative begun in 2002. Hor Namhong urged stronger USG-ASEAN ties, and noted that 2007 will mark the 30th anniversary of US-ASEAN relations; he hoped that there might be an ASEAN-US Summit to mark the event. The FM pressed DAS John on Cambodia's membership in APEC, adding that PM Hun Sen has offered to join the US-ASEAN Seven meeting in Hanoi on the margins of the APEC Summit in Hanoi later this year. Cambodia is also seeking USG support for the former's bid to the UNSC rotational seat for Asian countries in 2013-2014. ¶4. (C) DAS John thanked the FM for his overview and concurred on the positive political and economic trends in Cambodia, as well as the increasing importance the USG places on our bilateral relationship. He linked continued economic growth with further reform measures, such as addressing land disputes and land grabbing, enhanced respect for human rights through legal reforms (e.g., decriminalization of defamation) as such institutional changes send the right signals to foreign investors. Cambodian remains in a competitive region of the world for pricing, but can continue on a growth track if it remains committed to fair labor laws and respect for human rights. TIFA will also establish investor confidence, and DAS John noted that both countries can move forward as a result of agreement on the issue of bilateral debt. ¶5. (C) DAS John took note of the RGC's request for support in its bid for a UNSC seat in 2013-14, but added that the more immediate issue is the choice between Guatemala and Venezuela later this year for the Latin American rotational seat. DAS John said that Venezuela has shown itself to be a poor performer in international fora; FM Hor Namhong responded that Cambodia would consider this issue very seriously. On the Enhanced Partnership with ASEAN, DAS John said that this will represent the first time the USG will pursue a TIFA with a regional organization. The FM raised the Trade Act and asked about prospects for passage. DAS PHNOM PENH 00000894 002 OF 003 John replied that while he understands the benefits for Cambodia, he cannot make any assurances. Burma -------------- ¶6. (C) Thanking Cambodia for its position on Burma, DAS John noted that the USG cannot participate in a US-ASEAN Summit with Burma's head of state. It is desirable to go beyond the ASEAN Seven and include Laos and Cambodia in meetings such as APEC, he continued, and the U.S. welcomes Cambodia's interest but no decision has been made. Much depended on Cambodia's continued progress in democratization and human rights. In working towards a full US-ASEAN Summit with all ten ASEAN countries, dramatic changes must take place in Burma, underscored DAS John. Cambodia could be an important ally in that regard. The main steps to take are national reconciliation between the government and the NLD, release of all political prisoners including Aung San Suu Kyi, a true dialogue on the future of Burmese democracy, and the ability of the UN and NGOs to work in the country. So far, concluded DAS John, the military junta has found all these points to be difficult obstacles. ¶7. (C) Hor Namhong said that in last year's ASEAN leaders meeting in Kuala Lumpur, all nine ASEAN leaders had talked very strongly with Burma, saying that they could no longer defend the regime. At the recent FM's retreat in Bali, he continued, all again expressed disappointment in Malaysian FM Hamid's visit to Rangoon. The Cambodian FM said that in his opinion, the regime in Rangoon will one day realize the road map, but the ultimate problem will be elections -- will the military accept the results? DAS John responded that the USG has worked assiduously to get key players in the region -- such as China, Japan, India and ASEAN -- to deliver a common message to the Burmese regime on the need for national reconciliation and a true dialogue on democracy, the release of political prisoners including Aung San Suu Kyi, and freedom for the UN and NGOs to operate in Burma. ASEAN's recent statements have been a significant step. DAS John welcomed ASEAN efforts at quiet diplomacy while publicly noting disappointment with the regime. EAS --- ¶8. (C) Hor Namhong asked about the USG position on the East Asian Summit (EAS),noting that a number of countries (China, India, Korea, Japan, New Zealand) have joined. DAS John said that the USG is still evaluating its position but does not oppose the new organization. The USG prefers to watch with positive interest and not discourage; the USG still has questions regarding focus and possible duplication with other regional organizations. DAS John added that it was important for ASEAN to have a stronger voice in the region. Hor Namhong explained that the EAS evolved from the East Asian Study Group's recommendations. He underscored ASEAN's wish that the United States join the EAS. DAS John said that the USG wants to be engaged in Asia in a positive manner and did not rule out the possibility. (Note: Secretary of State for ASEAN Affairs Kao Kim Hourn has also said ASEAN is in favor of U.S. membership in the EAS; while Cambodia is supportive, we cannot comment on other ASEAN thinking. End Note.) China -------------- ¶9. (C) China and its role in the region is the topic of a significant public debate in the U.S., said DAS John. Deputy Secretary of State Zoellick has said that China must be a SIPDIS responsible stakeholder in Asia, which could be positive for Southeast Asia's economic growth and stability. Cambodia's economy can grow as China's grows, he added, and Cambodia's democratic institutions can provide a positive model for China. China and the U.S. can co-exist in the region in friendly competition. The FM stressed that Cambodia and China have good relations based on China's providing loans, investment, and tourists. China, he added, has always respected Cambodia's sovereignty and had not interfered in preparations for the Khmer Rouge Tribunal. China has a role in Southeast Asia to maintain peace and security, the FM affirmed. DAS John remarked that both China and the U.S. have elevated their level of engagement with ASEAN to the PHNOM PENH 00000894 003 OF 003 region's benefit. Comment -------------- ¶10. (C) This was Hor Namhong's best performance with a U.S. diplomat in recent memory and one of the best represented by senior MFA officials as well. In addition to the FM, three out of five Secretaries of State were in attendance, as well as Sar Sambath, head of the Americas desk. We understand that Singapore Foreign Minister George Yeo's criticism of Hor Namhong's poor grasp and handling of U.S.-Cambodian relations reached the Prime Minister's ears, and since then the normally anti-U.S. Foreign Minister has been more accessible, engaging, and animated in discussions with us. End Comment. STORELLA