BOUTEFLIKA ANNOUNCES MINOR CABINET RESHUFFLE

C O N F I D E N T I A L ALGIERS 000790 SIPDIS SIPDIS E.O. 12958: DECL: 06/05/2017 TAGS: PGOV KDEM INRB AG SUBJECT: BOUTEFLIKA ANNOUNCES MINOR CABINET RESHUFFLE REF: ALGIERS 330 Classified By: DCM Thomas F. Daughton; reasons 1.4 (b, d) ¶1. (U) President Bouteflika made minor changes to the cabinet on June 4 as a culmination of the May 17 national elections and the May 31 installation of the new parliament. The six ministerial changes did not live up to public speculation about a major reshuffle. As was widely expected by the press and political observers -- and in spite of grumbling within his own party about the result of the election -- Prime Minister Belkhadem retained his post. Also as expected, Foreign Minister Bedjaoui (aged 78) departed the government, to be replaced by the previous finance minister, Mourad Medelci. Karim Djoudi, previously minister-delegate for financial issues, will take Medelci's seat at the cabinet table. The other new faces in the cabinet are: -- Abderrachid Boukerzaza, Ministry of Communications; -- Noureddine Moussa, Ministry of Housing and Urbanism; -- Hachemi Djiar, Ministry of Youth and Sports; -- Mahmoud Khedri, Ministry of Relations with Parliament. (The entire list of Bouteflika's June 4 appointments has been emailed to NEA/MAG.) HO-HUM -------------- ¶2. (C) Up to the day of the announcement, MPs from the presidential coalition parties were telling us that Bouteflika would not announce the new cabinet until his return from the G-8 Summit in Germany. The strong resemblance of the new cabinet to the old was also apparently unexpected -- at least by the official government daily newspaper El Moudjahid, which had lately been replete with articles on "reform" and Bouteflika's dynamic program. Unphased by the new cabinet list, El Moudjahid's lead headline on June 5 described it as "A Government to Accelerate Reforms." ¶3. (C) Amara Ben Younes, president of the opposition Democratic and Republican Union (UDR),told PolEc Chief June 5 that the announcement was disappointing even by the standards of Algerians who are lukewarm about reform. He predicted another new government would be formed following local elections in the fall because the newly named government had no credibility in advancing reform. Ben Younes acknowledged that presidential coalition members all had talking points welcoming the president's move, but predicted that in a few days the reformers among them would privately express their disappointment. CONFIDENCE NOT COMPETENCE -------------- ¶4. (C) Hamid Lounaouci of the Rally for Culture and Democracy (RCD),another opposition party, told us there was much disappointment, even among the coalition parties, in the naming of Medelci as foreign minister. He joked that Bouteflika gave Algerians "a man of confidence, not a man of competence" to look after Algeria's external relations. Lounaouci said Bouteflika had clearly chosen someone close to him and in whom he had much confidence, rather than someone well versed in diplomacy. It was well known that Bouteflika placed a high premium on loyalty and trust, he observed, and the president clearly gave those factors the greater weight in choosing Bedjaoui's successor. ¶5. (C) BIO NOTE: Medelci's government experience is confined to the financial realm. He has served as finance minister since May 2005. In the 1980s, he served as the second-highest official at the ministry of commerce and the president of "the shareholders' fund" created in June of ¶1988. In November 1988, he was named minister of commerce. In the 1960s and 1970s, Medelci was the financial director of the National Company for Studies and the director general of the national tobacco company. He is the married father of five children and holds an economics degree. Medelci speaks Arabic and French. He understands some English but does not speak it. ¶6. (C) COMMENT: Belkhadem's continued tenure as prime minister was a setback for former PM Ahmed Ouyahia, who has behind-the-scenes support (reftel) to succeed Bouteflika as president. While the ailing Bouteflika could still seek to amend the constitution and create a vice presidency for Ouyahia or someone else, he has not even hinted to date that he is thinking about succession. Indeed, aside from handing pro-reform Minister of Privatization and Investments Abdelhamid Temmar added responsibility for the ministry of industry, Bouteflika did nothing to suggest that an "acceleration of economic reform" (El Moudjahid's headline notwithstanding) is high on his agenda. More than anything, the new cabinet typifies the inertia that has increasingly mired the Algerian government. FORD