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

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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
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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

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John replied that while he understands the benefits for
Cambodia, he cannot make any assurances.

Burma
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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

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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

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region's benefit.

Comment
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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