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