U.S.-JAPAN CENTRAL ASIA DIALOGUE: PART ONE,

C O N F I D E N T I A L SECTION 01 OF 09 TOKYO 007097 SIPDIS C O R R E C T E D C O P Y (ADDED INFO ADDRESSEE) SIPDIS E.O. 12958: DECL: 12/20/2016 TAGS: PREL PHUM PGOV ECON ZK JA SUBJECT: U.S.-JAPAN CENTRAL ASIA DIALOGUE: PART ONE, STRATEGIC OVERVIEW TOKYO 00007097 001.3 OF 009 Classified By: CDA Joseph R. Donovan. Reasons: 1.4 (b, d) ¶1. (C) SUMMARY: Deputy Assistant Secretary for South and Central Asian Affairs Evan Feigenbaum and a team of State and USAID officials met December 8 with Japanese officials for a day of consultations on Central Asia. The U.S. team aimed to integrate an intensive strategic and policy consultation with focused discussions of U.S. and Japanese foreign assistance priorities in the region. The MOFA delegation was co-chaired by Shinsuke Sugiyama, Deputy Director-General of the Middle Eastern and African Affairs Bureau, and Takeshi Yagi, Deputy Director-General of the European Affairs Bureau, with participation from five MOFA bureaus and five Japanese government ministries and agencies. At the opening session, which focused on strategic priorities, topics of discussion included: (1) U.S. and Japanese strategic objectives in Central Asia, (2) relations among Central Asian states, Afghanistan, and others, and (3) U.S. and Japanese policies toward Central Asia, especially Uzbekistan and Kazakhstan. ¶2. (C) Summary, continued: Both sides agreed that Japan and the United States share the same broad goals for Central Asia, thus it would be beneficial to pursue complementary programmatic efforts in the region. Both explicitly rejected the nineteenth century "Great Game" as an analogy for the region's current strategic environment, although aspects of Russian and Chinese involvement in the area raise a number of questions for both Washington and Tokyo. Each side shared its assessment of the political and economic situation in the five Central Asian countries, generally agreeing that Uzbekistan, while perhaps the country with the most inherent potential, has been difficult to work with and continues to be a disappointment, while Kazakhstan, less populous but with natural endowments of oil and gas and better macroeconomic policies, is showing promising signs, despite insufficient progress on political reform. Relations with Kyrgyzstan, Tajikistan, and Turkmenistan also present challenges, but both Japan and the United States are willing to continue focused engagement on a spectrum of interests in each country. The Japanese side stressed Russian and Chinese sensitivity about Japan's role in Central Asia and asked that the United States not broadcast the fact that the two allies had held a consultation on the region; doing so, the Japanese said, would raise questions in Moscow and Beijing about Tokyo's motives. Septels report DAS Feigenbaum's discussions concerning foreign assistance and trade and investment in the region. END SUMMARY. -------------- SHARED INTERESTS -------------- ¶3. (C) DAS Feigenbaum opened the meeting by thanking the Japanese for hosting and by pointing out that it made sense for two allies with an increasingly global partnership to compare and coordinate, as feasible, their strategic plans for Central Asia. Washington tries to pursue an integrated strategy involving the coordination of strategies and policies with programs and budgets, he said, thus it made sense to try to do this, too, in consultations with key partners. For this reason, said Feigenbaum, he had brought to Japan a team that included USAID representatives, both from the field and from Washington, and he had also brought the SCA bureau's senior advisor for regional economic integration. Feigenbaum noted that while the United States has more traditional partners on Central Asia, especially in Europe, not all of them are as serious as Japan with respect to assistance budgets and project finance. The United States and Japan each hit the four major baskets of interest in Central Asia; both countries have: (1) strong strategic and policy interest, (2) commercial activism, (3) robust assistance programs, and (4) a demonstrated capacity for project finance in the region. On that basis, said Feigenbaum, there may be opportunities for the two TOKYO 00007097 002.3 OF 009 governments to implement Central Asia programs in a complementary, though not necessarily joint, fashion. ¶4. (C) Sugiyama agreed and then described Japan's overall policy in Central Asia in the context of FM Aso's recent foreign policy speech, in which he described the strategic importance to Japan of cultivating strong political and economic relationships with nations that lie along a path of what Aso described as an "Arc of Freedom and Prosperity." As described by Aso, the arc begins in Northeast Asia, continues into Southeast Asia (Cambodia, Laos, Vietnam) through Central Asia and the Caucuses, and into northern Europe. ¶5. (C) While the FM's presentation did not particularly emphasize Central Asia, Sugiyama continued, it did refer to the region in an important manner. In Central Asia and elsewhere, Japan intends to pursue what Aso described as "values-oriented diplomacy," aimed at promoting modern values such as freedom, the rule of law, market-oriented economies, and human rights, etc. Based on Japan's experience in the Middle East and Africa, Tokyo officials believe this values-oriented approach is the only way free people can achieve economic and social prosperity, he said. The process of adjusting Japan's diplomacy will take some time, he added. Japan will need to employ values oriented diplomacy in a prudent manner, taking into account the diversity inherent in each Central Asian state. ¶6. (C) Sugiyama cautioned that the U.S. and Japan should avoid being seen as "ganging up" on Central Asian countries, or on other countries with interests in the region, notably Russia and China. Tokyo would not insist on doing things Japan's way -- some nations in the area must be able to adopt their own approaches to development, especially political development. Japan seeks to employ a "sensitive approach" to states of the region, even as it implements values-oriented diplomacy, he said. The Japanese delegation hoped to hold more detailed discussion with the U.S. side about each nation in the region. ¶7. (C) European Affairs Deputy Director Yagi concurred. Noting that he had read some of Feigenbaum's recent speeches on Central Asia, he pointed out that Tokyo's language on Central Asia was almost identical to the views expressed in Feigenbaum's speeches. "Like you," he said, "we are not 'anti-anyone'" in the region, he said. -------------- CHALLENGES FACING CENTRAL ASIA -------------- ¶8. (C) Yagi provided an overview of basic Japanese strategies toward Central Asia. In Japan's view, he said, the Central Asian region faces a number of challenges. These challenges range from classic geopolitical problems to new transnational threats, and they include the resurgence of Russian influence in the area -- especially following the withdrawal of U.S. forces from Uzbekistan. Continued instability in Afghanistan is worrisome. China, meanwhile, has a growing strategic role backed by an economic focus on the countries of the region. Although the threat of political instability does not appear to be a problem, said Yagi, Russian influence, especially when combined with Chinese influence, is most undesirable for Japan. As a result, Yagi noted, Japan has two main aims in Central Asia: (1) pursue regional development, conducted in a sustainable manner, that will leave Central Asian nations open to the international community, and (2) share the universal values of democracy, human rights, and market economics. ¶9. (C) China and Russia, on the other hand, do not, said Yagi, demand that Central Asian governments adhere to internationally accepted standards of human rights. The region's leaders are therefore more comfortable with Russia TOKYO 00007097 003.3 OF 009 and China than with the United States and Japan. Especially following the "color" revolutions in Ukraine and elsewhere, Central Asian heads of state have become alarmed by the concept of democracy. Their reaction in this regard tended to be somewhat illogical, he maintained. A second complicating factor for Japan involves Russian and Chinese trade with Central Asia, which amounts to USD 8-9 billion, according to Yagi; U.S. and Japanese trade with the region amounts, he said, is just one-third that amount. However, Yagi maintained, despite an affinity among the region's leaders for Russia and perhaps China, they, too, are nevertheless concerned about the rising influence of these two major outside powers. And they also seem open to increased economic cooperation with Japan and the West to counter trade barriers from these two giant neighbors. ¶10. (C) Faced with these challenges to Japanese interests, Yagi continued, FM Aso hopes to promote bilateral and regional cooperation with Japan. In the absence of cross-border coordination, Central Asian nations would find it difficult to face challenges such as transnational narcotrafficking, terrorism, and environmental problems. On the economic front, regional leaders might find it useful to develop a common market. FM Aso hopes to emphasize three guidelines for Japan's work with Central Asia: (1) look at the area from a broad-based perspective, especially with regard to the southern neighbors, e.g. Afghanistan, (2) develop several trade routes that could be used as alternatives to the PRC and Russia by stressing regional cooperation, and (3) strive to work in a coordinated fashion with the United States, "because we share the same values and ideas about democracy, and because resources are limited." ¶11. (C) Turning to Afghanistan, Sugiyama said that observers sometimes remark that while the Taliban did nothing correct in Afghanistan except to halt the narcotics trade, the current Karzai administration appears to be doing everything better except stopping narcotrafficking. Sugiyama stressed that Japan understands the importance of achieving political stability in Afghanistan and that Tokyo is prepared to further international efforts in that direction. The United States and Japan, he said, still have much to do in trying to support Karzai's government. Asked by SCA Senior Advisor Robert Deutsch about whether Japan would move forward with tenders on its section of the Ring Road, Sugiyama reaffirmed the Japanese government's commitment to complete its segment of the Ring Road project, noting that the tender process was underway. -------------- U.S. VIEWS -------------- ¶12. (C) DAS Feigenbaum responded to the Japanese presentation by stating that although Central Asia is admittedly not the most pressing region of foreign policy concern to the United States, the issues manifest there constitute a microcosm of nearly everything that is important in current U.S. foreign policy, with the obvious exception of the future of Iraq: (1) a resurgent Russia, increasingly active in its neighborhood, (2) an emerging China, with its growing regional and global footprint (3) a problematic Iran, (4) the challenge of Islam's future and the struggles within Islam, (5) the future of Afghanistan, (6) the promotion of democracy in tough, often hostile, environments; (7) the challenge of terrorism, and (8) balancing promotion of political liberalization with other goals. All of these challenges are manifest in Central Asia in interesting, sometimes complicated ways, thus the region receives more high-level attention than one might expect from simply looking at its remote location on a map. The United States, said Feigenbaum, remains committed to staying involved in the area and is committed for the long-haul -- by virtue of its presence, assistance, programs, and high-level policy attention. TOKYO 00007097 004.3 OF 009 ¶13. (C) The United States, Feigenbaum noted, looks to avoid the debilitating effects of Great Power confrontation and rejects the "Great Game" metaphor for Central Asia. This is not to say that competition among the major powers does not exist. But the term is an oversimplification that is, in the first place, insulting to Central Asian states because it reduces countries of the region to little more than passive receptacles of a game played by others, as if they lacked independent interests, policies, goals, or capacity to pursue those goals. Indeed, Feigenbaum said, some Central Asian countries had pursued a balance to maximize their independence, sometimes playing the major powers off against each other. He offered the example of Kazakhstan's "multivector" foreign policy; Kazakhstan had sought to balance relations with Russia, China, the United States, and now Europe. The "Great Powers" -- the United States, Russia, China, India, Japan, and others -- also enjoy relatively productive relations at a global level, with many of the powers improving their relations with one another. The major outside powers have some overlapping interests in Central Asia, including the problems of narcotrafficking and counter-terrorism. Central Asians should not, therefore, be seen merely as objects of a struggle among outsiders. Rather, said Feigenbaum, they are the very focus of U.S. (and, hopefully, Japanese) policy in this part of the world. ¶14. (C) Washington takes a multi-dimensional approach to Central Asia, he continued, focusing on several "baskets" of interests simultaneously, including security, trade, diversification of energy supply, promotion of political reform, and combating transnational challenges. The United States has worked to build capacity in the region across the seams of these baskets -- for example, promoting the rule of law has implications for both democracy promotion and trade; modernizing customs and borders prevents terrorism but also facilitates commerce. The U.S. has supported the development of Drug Control Agencies in Kyrgyzstan and Tajikistan, provided vaccinations to several hundred thousand children in Uzbekistan (where U.S. assistance has constituted some 10 percent of Tashkent's public health budget),and offers micro-credits to small businesses in various countries. Among U.S. programs in the region, the economic "basket" remains the largest. ¶15. (C) The U.S., Feigenbaum noted, also takes an active role in promoting regional economic integration by: (1) encouraging Central Asian states to integrate with each other by removing economic and political obstacles to trade, such as cross-border travel, (2) promoting integration between Central Asia and its southern neighbors by looking to Afghanistan as a bridge; and (3) helping Central Asia integrate into the global economy by promoting WTO membership and improving their investment climate. In short, the U.S. has an "omni-directional" approach to the region, pressing for expansion of economic linkages in every direction on the compass; but Washington now places special emphasis on trade routes to the south because it is the least developed direction and new opportunities exist for energy trading and infrastructure development. Supporting Central Asia's sovereignty and independence, said Feigenbaum, means giving these countries options: more than one dominant trading partner, more than one market, and more than one pipeline through which to move exports to the world. This policy is not "anti-Russian," just "anti-monopoly." The countries of the region, he concluded, deserve to have choices. ¶16. (C) Sugiyama agreed that political and institutional development must advance in tandem with social, economic, and trade reform. This, however, is difficult to do, and presents an important impetus for the United States and Japan to work together. Yagi concurred that Aso, too, rejected the Great Game analogy, stating that Japanese policy toward the Central Asians was to give them ownership of the issues. In TOKYO 00007097 005.3 OF 009 addition, Japan wants to be careful not to do anything that will provoke or upset Russia or China. ¶17. (C) Japan also realizes that enhancing regional cooperation in Central Asia is more easily said than done, said Yagi. When it comes to promoting regional cooperation, it is best to start with issues that involve only one or two countries but which might have regional impact and hope that, by demonstrating success, other projects will follow. -------------- COUNTRY-BY-COUNTRY ASSESSMENTS -------------- Uzbekistan -------------- ¶18. (C) Yagi observed that for Japan, Uzbekistan was the most difficult country in Central Asia to work with. At the same time, it is the indispensable nation in Japan's Central Asia policy. It has the largest population of the Central Asian states and a long border with Afghanistan that can potentially be destabilized. Whether or not President Karimov remains in power, it will remain critical to work with the Uzbeks. Everyone, said Yagi, is familiar with the human rights and democratization problems of the country. He noted that when former Prime Minister Koizumi visited Tashkent in August, he personally raised the issue with Karimov of the need to make progress on human rights and reform, pointing to Japan's own experience to illustrate the point. Karimov's responded that Japan's experience offered useful lessons, and predicted his relations with the United States would improve. Yagi said the Japanese have a "realistic" view of this response, but nevertheless thought it was a positive, if vague, statement. Japan views some recent steps by the Uzbeks as positive improvements, such as agreeing with the European Union to discuss Andijan and to an Uzbek-EU human rights dialogue. Yagi asked for a U.S. view on Uzbekistan. ¶19. (C) Feigenbaum responded that he was pleased Koizumi had raised the issues of reform and human rights. The United States (and Japan, for that matter) share several goals in their approach to Central Asia: expansion of markets, more openness and political reform, and promotion of regional cooperation and integration. On all of these counts, said Feigenbaum, Karimov's government appeared to be pursuing policies at odds with our common approach to the region. In contrast with Kazakhstan, Karimov had made some poor economic choices, relying on discredited planning methods and emphasizing cotton and gold. Politically, the GOU maintained that the U.S. vision of democracy is a threat. On regional cooperation, instead of being the economic lynchpin it should be, Uzbekistan had rejected many aspects of integration, insisting on its own way or no way. This is not, said Feigenbaum, a uniquely "American" view of Uzbekistan; the Tajiks, Kyrgyz, and Kazakhstanis all are skeptical of Uzbek policies, find Tashkent a difficult partner, and have a jaundiced view of its role in the region. The United States, moreover, has a unique problem that Japan does not face, namely Uzbekistan's effort to reduce the U.S. presence in the country by removing the Peace Corps, NGOs, corporate investors, a U.S. airbase, and some U.S. personnel. Yet the United States continued to pursue dialogue with Uzbekistan and would continue to do so. In 1991. most observers expected Uzbekistan to be the most successful country in the region. Instead, we are struggling to move forward even on the issues we ostensibly agree upon, such as the threat of terrorism or the need for investment in youth and education. In short, Uzbekistan is a very difficult country, but we can, and should, have a better relationship, and the United States will continue to try, running programs and pursuing dialogues where it is realistic to do so. TOKYO 00007097 006.3 OF 009 ¶20. (C) Asked by Yagi about the U.S. view of Europe's sanctions and dialogues, Feigenbaum noted that the U.S. approved of the decision to extend sanctions. The U.S. hoped the dialogue would produce progress but had cautioned EU partners not to conflate dialogue in itself with forward movement on expressed European concerns. Yagi asked whether the measures taken by the Uzbeks to harass non-governmental organizations were aimed only at American NGOs. USAID's Central Asia Mission Director Christopher Crowley responded that steps have been taken to shut many NGO's, not just American ones. Karimov simply sees the long term development of a civil society and democratization as a threat. In addition, the Uzbeks seem to be trying to block our cooperation with other countries in the region. Highlighting again that we are not hostile to the Uzbeks and that we want to work with them, where feasible, Feigenbaum explained that it is important that the United States, Japan, and the European Union work together. Kazakhstan -------------- ¶21. (C) Kazakhstan is viewed by the Japanese as relatively more stable than Uzbekistan, and is very important to Tokyo's programs in the region, Yagi said. Japan maintains good foreign relations with Kazakhstan but recognizes that, in essence, it is still ruled by an authoritarian regime. In addition, Russia remains Kazakhstan's most important partner. ¶22. (C) Feigenbaum agreed that President Nazarbayev should move forward on political reform but noted macroeconomic and structural reforms in Kazakhstan. Corruption remains a problem. Washington enjoys a robust and multi-dimensional partnership with Astana and had hosted Nazarbayev in September and issued a forward-looking Joint Statement. Nazarbayev appears persuaded that we and our programs are not a threat to him and has played an active role in promoting educational exchanges. Crowley noted that, in a first for USAID programs, Kazakhstan is actually co-financing many of U.S. assistance projects in that country. Kyrgyzstan -------------- ¶23. (C) Kyrgyzstan is a "bitter disappointment" to the Japanese, said Yagi. The few projects the Japanese have agreed upon have not gone well, and the country seems plagued by a basic instability. Nevertheless, Tokyo will continue to support the Kyrgyz and look for ways to work with them. ¶24. (C) Feigenbaum agreed that the Tulip Revolution had not lived up to expectations, but noted that Kyrgyzstan faces many challenges, including grinding poverty, a lack of political will, and neighbors who are not supportive of Kyrgyz democracy. After a rough patch over the summer, U.S.-Kyrgyz relations had improved. Recent street demonstrations had ended peacefully, Kyrgyzstan had a new constitution, and the media and civil society remain brighter spots. The U.S. maintains its airbase at Manas. Tajikistan -------------- ¶25. (C) Yagi noted that Tajikistan is the only country in the region in which Islamic parties are active. Japan is unclear on the direction President Rahmanov is taking the country. It appears that in his most recent cabinet shuffle he had dismissed many of his allies, and this might be a setback. Feigenbaum replied that the country had come a long way from its civil war and was an increasingly important U.S. partner. Tajikistan faces many challenges in the economic basket, but we are excited about the potential for developing the country's hydropower potential. We have also seen successes in the field of counternarcotics, and Rahmanov seems eager TOKYO 00007097 007.2 OF 009 for more American investment, even if the challenges remain great. Turkmenistan -------------- ¶26. (C) Yagi and Feigenbaum agreed that prospects for improved relations with Turkmenistan are bleak. Yagi pointed out that, despite Japanese attempts to engage, the Turkmen refuse all proposals for cooperation and rarely participate in regional meetings, such as the "Central Asia plus Japan" Forum. When they do come, it is usually at a low level. Feigebaum agreed the country is suffering from a personality cult, but argued that efforts should continue to be made to work constructively with Ashgabat. The U.S. maintains a Trade and Investment Framework Agreement in Central Asia that includes Turkmenistan. We also engage in some security-related cooperation. The human rights situation is poor. -------------- RUSSIA, CHINA, IRAN -------------- ¶27. (C) Over a restricted luncheon hosted by MOFA, discussion turned to the role of Russia, China, and Iran in the region. With regard to China, Yagi said Japan casts a wary eye on its activities in the region. Japan has noted the expansion of Chinese commercial activity and is concerned that the large loans Beijing is making in the region, e.g., 637 million USD to Tajikistan, will lead to a debt burden and thus financial instability. Although not interested in full membership, Japan would like to know more about what the Shanghai Cooperation Organization is about. Tokyo is inclined to view the SCO as an organization where ideas are exchanged but little actually gets done. Nevertheless, the potential for cooperative political action exists, such as SCO summit meetings or even military exercises. Feigenbaum raised similar questions about the functions of the SCO. "What is it," he asked, "a security group? an economic group? an anti-American vehicle? or a "safe-zone," as A/S Boucher had put it, for authoritarian leaders? The United States, he noted, also wonders about SCO goals and purposes, particularly in the field of security. The role of Iran in the SCO and its 2005 statement about the U.S. military presence were of concern. But the Chinese are playing an interesting role in the region, building infrastructure and restoring old trade patterns. This had begun to produce some disquiet in the region, e.g., in Kazakhstan. ¶28. (C) Japan, said Yagi, fears provoking China in Central Asia because it hopes to improve relations with Beijing more broadly, particularly with regard to the Six Party Talks. So far, according to Yagi, the Chinese have not reacted to Japan's activities in Central Asia, e.g., the Japan plus Central Asia forum. They seem preoccupied with promoting stability in the Uighur areas of northwest China and advancing their economic penetration of the region. ¶29. (C) Feigenbaum asked about Japan's views of Iran's involvement in Central Asia. Despite the fact that the Iranain brand of political Islam makes Central Asian leaders nervous, they seem to willing to engage with Iran at least as far as economic links are concerned. Hiroshi Fukada, Deputy Director General of MOFA's International Cooperation Bureau, noted that Iran seems to be seeking expanded influence in the region, perhaps through involvement in the SCO. He warned that the rise of radical or fundamentalist Islam is something that should be watched. Sugiyama said there is concern that Iran is trying to recreate the Persian Empire and is looking to expand its influence, including to the north. ¶30. (C) Yagi noted that, among the major outside powers, Russia seems most concerned about Japanese activities in TOKYO 00007097 008.3 OF 009 Central Asia. The Russians have made it clear to FM Aso that they are opposed to any "outside" activities in in the region and that Moscow believes Central Asia is "theirs." As a result, Tokyo is trying to be very transparent about what it is doing in the region in order to avoid raising suspicions. It has briefed Russia on the Central Asia plus Japan dialogue and will continue to pursue this type of dialogue and engagement with Moscow to lessen its suspicions. Feigenbaum agreed the Russians are sensitive about Central Asia. He noted A/S Boucher's recent trip to Moscow: we, too, have tried to engage in bilateral discussions about Central Asia, he said, but Moscow still feels threatened and is not much interested in talking to us. They have occasionally tried to block U.S. initiatives. The United States is realistic about Russia's role, said Feigenbaum. -------------- PARTICIPANTS -------------- ¶31. (SBU) The following participants attended the meeting: U.S. Delegation -------------- SCA Deputy Assistant Secretary Evan Feigenbaum SCA Senior Advisor for Regional Economic Integration Robert Deutsch USAID Central Asia Mission Director (Almaty) Christopher Crowley USAID Europe and Eurasia Bureau Senior Program Officer Timothy Alexander Embassy Tokyo Political Officers (notetakers) Japanese Delegation -------------- Deputy Director General Shinsuke Sugiyama Middle Eastern and African Affairs Bureau, MOFA Deputy Director General Takeshi Yagi European Affairs Bureau, MOFA Deputy Director General Hiroshi Fukada International Cooperation Bureau, MOFA Director Takeo Mori First North America Division, MOFA Director Manabu Miyagawa Economic Security Division, MOFA Director Akira Muto Fourth Division, Intelligence and Analysis Service, MOFA Director Tsutomu Nakagawa Policy Planning Division, Foreign Policy Bureau, MOFA Director Hideki Uyama Central Asia and Caucasus Division, MOFA Director Toshikazu Masuyama Middle East/Africa/Russia Division, Trade Policy Bureau Ministry of Economy, Trade and Industry Senior Deputy Director Rintaro Tamaki International Bureau Ministry of Finance Deputy Director General Hiroshi Niino TOKYO 00007097 009.3 OF 009 Regional Dept. II (including Central Asia) Japan International Cooperation Agency Team Director (Afghanistan) Yodo Kakuzen Regional Dept. V, Middle East, Europe) Japan International Cooperation Agency Team Director Hiroto Kamiishi Global Development Partnership Team, Planning Group Japan International Cooperation Agency Director Shohei Hara Division 2, Development Assistance Dept. IV Japan Bank for International Cooperation ¶31. (U) This cable was cleared by Deputy Assistant Secretary Feigenbaum. DONOVAN