AMBASSADOR'S MEETING WITH MOF/MFA SECOND MINISTER

UNCLAS SECTION 01 OF 02 SINGAPORE 000990

SIPDIS

SIPDIS
SENSITIVE

STATE PASS TREASURY FOR PBROWN AND HLOUIE

E.O. 12958: N/A
TAGS: ECON EFIN EINV ETTC PGOV PREL SN
SUBJECT: AMBASSADOR'S MEETING WITH MOF/MFA SECOND MINISTER
RAYMOND LIM



1. (SBU) Summary. Second Minister for Finance and Foreign
Affairs Raymond Lim told the Ambassador during a March 24
courtesy call that the United States and Singapore could resolve
issues separating us on a double taxation agreement (DTA). On
casinos, he said that Singapore would implement additional laws
and regulations needed to keep the country's clean and uncorrupt
reputation intact. The Ambassador emphasized that a robust
casino regulatory regime required laws governing cash couriers
(which Singapore lacks). Acknowledging the good cooperation
under the Container Security Initiative (CSI) to monitor cargo
bound for the United States, the Ambassador stressed that the USG
remained concerned about the lack of screening for cargo bound
elsewhere. Second Minister Lim said that he was worried about
the ramifications for free trade stemming from the recent Dubai
ports decision. On encouraging Thailand to join the
Proliferation Security Initiative (PSI),Lim urged patience as
the Thai government worked through its political difficulties.
He noted that Iran's making its nuclear ambitions a matter of
national pride had made dealing with that country's nuclear
ambitions increasingly difficult. End summary.

Double Taxation Agreement
--------------


2. (SBU) The Ambassador raised our ongoing discussions to
negotiate a mutual legal assistance treaty (MLAT) and, possibly,
a DTA. She noted that in both cases, Singapore would need to
meet Treasury's requirements on certain, fundamental
prerequisites such as information sharing. In reference to the
DTA, Second Minister Lim said that Singapore wanted to conclude a
tax treaty with the United States. In his correspondence with
Secretary Snow, he had asserted that the issues could be

SIPDIS
resolved, he said; they were not insurmountable. (Note: the
Attorney General's Chamber has the lead on negotiating an MLAT.
End note.)

Casinos
--------------


3. (SBU) Asked how Singapore would cope with the law enforcement
and social ramifications of two multi-billion dollar casinos
slated to come online in 2009, Second Minister Lim said that
Singapore was "quite seized" with this issue, especially since
Singapore's reputation for "integrity, honesty, and
trustworthiness" was at stake. He expressed confidence that
Singapore had a solid anti-money laundering and terrorist finance
regime. The government was working to implement the Financial
Action Task Force's (FATF) legal and regulatory recommendations
in this regard, he said. The Ambassador emphasized that laws
governing cash couriers (which we are urging Singapore to enact)
would be a critical component of a robust casino regulatory
environment.

Screening Transshipped and Transit Cargo
--------------


4. (SBU) Asked about Singapore's efforts to enhance its
screening of transshipped and transit cargo, especially for WMD,
Second Minister Lim said that this was a question of balancing
efficiency with security. Timely and useful intelligence -- upon
which Singapore will promptly act -- was the best way to manage
the security angle, he asserted; it was not sensible to check
every container. The Container Security Initiative (CSI)
represented a positive step, and we could do more, he concluded.
The Ambassador agreed that we enjoyed good cooperation on
containers bound for the United States under CSI. She
emphasized, however, that the USG remained concerned about
unscreened cargo bound for dubious destinations like the DPRK.


Dubai Ports
--------------


5. (SBU) Second Minister Lim said he worried that the recent
Dubai ports decision, coupled with the earlier CNOOC controversy
over its attempt to acquire Unocal, portended more than just a
temporary spike in protectionist sentiment in the United States.
The Ambassador agreed that politics was partially to blame, but
observed that Dubai Ports World probably could have undertaken a
more thorough lobbying effort in Washington and with the media in
order to build consensus ahead of time.

PSI
---


6. (SBU) Asked how best to convince Singapore's neighbors like
Thailand to join the Proliferation Security Initiative (PSI),

SINGAPORE 00000990 002 OF 002


Second Minister Lim said that PSI partners would have to be
patient as Thailand sorted through its political preoccupations.
In dealing with Thailand, he stressed the need to engage multiple
channels and not just the respective Minister. Although the
situation had improved under Prime Minister Thaksin, the tenure
of ministers in previous Thai administrations had been generally
short. This had emboldened certain civil servants opposed to
their minister's views to wait him or her out, he said. The
result--policy stagnation.

Iraq and Iran
--------------


7. (SBU) The Ambassador expressed appreciation for Singapore's
logistical and other support in Iraq and its position on Iran vis-
a-vis the International Atomic Energy Agency (IAEA). Recalling a
recent conversation with a non-proliferation expert based in
Geneva, Second Minister Lim said that he was concerned about the
way Iranian President Mahmoud Ahmadinejad had linked the nuclear
stand-off to national pride. In effect, the Iranian government
sat passively while those around them did the negotiating, he
ventured; high oil prices made the Iranians even less inclined to
compromise.

HERBOLD