KOSOVO: CONTROVERSIAL AND WEALTHY EXPAT FORMS NEW

C O N F I D E N T I A L SECTION 01 OF 02 PRISTINA 000989 SIPDIS SIPDIS DEPT FOR DRL, INL, AND EUR/SCE, NSC FOR BRAUN, USUN FOR DREW SCHUFLETOWSKI, USOSCE FOR STEVE STEGER E.O. 12958: DECL: 09/29/2016 TAGS: PGOV PREL KCRM EAID KDEM INR YI SUBJECT: KOSOVO: CONTROVERSIAL AND WEALTHY EXPAT FORMS NEW KOSOVO ALLIANCE PARTY REF: 05 PRISTINA 83 Classified By: COM TINA KAIDANOW FOR REASONS 1.4 (B) AND (D). ¶1. (C) SUMMARY: Bexhet Pacolli's Alliance for a New Kosovo (AKR) recently held its first convention in Pristina, evolving from a U.S.-based lobbying group for Kosovo independence into a registered political party. Pacolli, a wealthy Kosovar Albanian who lives in Switzerland, has plastered the Kosovo countryside with billboards advertising his new party and promising to work all manner of miracles for Kosovo. The party convention revealed Pacolli's autocratic style, but his wealth, ambition, and connections to former Assembly Speaker Nexhat Daci translate into influence. He remains unpopular and distrusted by many Kosovars for his murky ties to former Russian President Yeltsin, Slobodan Milosevic and -- allegedly -- to organized crime. END SUMMARY. Bexhet Pacolli: Controversial Emigre Millionaire ¶2. (C) The AKR held its first national convention on October 26, unanimously electing founder Bexhet Pacolli as party president. Pacolli is a controversial Swiss-Kosovar multi-millionaire who made his fortune through a series of lucrative deals between his company Mabetex and the Russian and Kazakh governments. He has been viewed with suspicion in the past because of rumored connections to the Russian political elite and the late former Yugoslav President Slobodan Milosevic (reftel). His first foray into post-conflict reconstruction in Kosovo was the 1.6 million euro renovation of the Kosovo Assembly building interior, which took place under former Assembly Speaker Nexhat Daci's tenure and may come under scrutiny for procurement irregularities as part of an ongoing audit process. In September 2004 Pacolli founded the Kosovo daily newspaper, Lajm Ekskluzive. Pacolli's brother, Selim Pacolli, runs the paper, which gives Daci-related scandals scant coverage while regularly following corruption stories involving other politicians. On the more reputable side, Pacolli is also the principal donor to the American University of Kosovo. AKR: From U.S. Lobbying Group to Party ¶3. (SBU) AKR began as a U.S.-based group lobbying for Kosovo independence; it was established in March 2006 and continues under the name New Kosovo Alliance. The New Kosovo Alliance website (www.newkosovo.org) is in English only, designed for a Washington and international audience rather than potential suporters in Kosovo. ¶4. (U) The AKR political party (slogan: "Enough Talk") applied to the OSCE for party status on April 18 and was registered two weeks later pursuant to OSCE rules. In October, Pacolli mounted an extensive advertising campaign in advance of the convention, plastering the countryside with huge billboards featuring himself and the headings "Alliance for Stability," "Alliance for Employment," or "Alliance Against Corruption." Pacolli told the convention that he anticipates the AKR participating in national elections in ¶2007. ¶5. (SBU) Pacolli's main focus is his pledge of economic development. The AKR economic platform promises to reduce unemployment, revitalize industry and agriculture, and strengthen the banking system. Pacolli participated in an October 5 CSIS event in Washington on economic cooperation and investment opportunities in south-eastern Europe, as did Deputy PM Lutfi Haziri, Minister of Trade Bujar Dugolli, and others. Pacolli also helped establish the Southeast Europe Economic Development (SEED) Foundation. Autocratic Convention ¶6. (C) The convention itself was hardly a study in democracy, as Pacolli brooked little debate or dissent. The delegates elected him by a show of hands rather than by secret ballot, PRISTINA 00000989 002 OF 002 and endorsed 31 members of the Steering Council, which then authorized Pacolli to hand-pick 20 others from experts in various fields, to reach the total of 51 members required by OSCE rules. Delegates also approved the party platform without objection. In the initial stages of the convention some delegates abstained from voting, but this ended when Pacolli asked for an explanation from an abstaining delegate. Some delegates wanted to modify the party statute, but the working committee decided to deal with written revision proposals "at a later stage." Though some delegates complained about the lack of openness in the process, little attention was paid to their remarks. ¶7. (C) Delegates included 15 representatives of the diaspora, 15 women, and 15 representing youth. Guests and observers at the October 26 convention included former Assembly speaker Nexhat Daci's son, Daci's advisor Ahmet Alishani (later arrested October 31 on corruption charges related to the recent audit report on Daci's tenure as Assembly Speaker),and representatives from OSCE, the Albanian Liason Office, the Democratic Party of Kosovo (PDK), Alliance for the Future of Kosovo (AAK),the Justice Party (PD),the Liberal Party of Kosovo (PLK),the Turkish Democratic Party of Kosovo (KDTP),and the Green Party of Kosovo (PGJK). Former Prime Minister and current ICTY indictee Ramush Haradinaj sent a letter of greeting, which was read aloud during the convention. ¶8. (C) Pacolli gave a wide-ranging speech accepting the party's nomination, arguing that Kosovo should be a presidential republic, and depicted AKR's goals as economic development and fighting corruption in politics. He said Kosovars can only restore their dignity through hard work, and cited his own wealth as a sign that Kosovars could trust him not to steal from the government budget. He claimed many international businessmen have promised him they will invest in Kosovo, and also said Russia would be constructive on Kosovo status, which he asserted would be resolved by March ¶2007. Pacolli complained that despite being a major employer, he was never consulted by Kosovo politicians, and also incorrectly told delegates and observers that the State Department had no Kosovo desk prior to his lobbying efforts. Comment ¶9. (C) Despite Pacolli's wealth, it is unlikely that the AKR will have an immediate impact -- as a party -- in Kosovo politics. Thus far, Pacolli has been unwilling to insert himself directly into the political scene, though he is likely bankrolling Daci's current efforts to take control of the ruling LDK. Both for his money and his links to Daci, Pacolli bears watching. However, given his reported unsavory business connections, we will continue to do so from a distance. END COMMENT. ¶10. (SBU) U.S. Office Pristina clears this cable in its entirety for release to U.N. Special Envoy Martti Ahtisaari. KAIDANOW