PRESIDENT ALIYEV, A/S LOWENKRON AGREE TO ESTABLISH

C O N F I D E N T I A L SECTION 01 OF 04 BAKU 000038

SIPDIS

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E.O. 12958: DECL: 01/02/2017
TAGS: PGOV PREL PHUM KDEM ETRD ECON IR RU AJ
SUBJECT: PRESIDENT ALIYEV, A/S LOWENKRON AGREE TO ESTABLISH
A PERMANENT DEMOCRACY DIALOGUE

Classified By: CDA Jason P. Hyland, Reasons 1.4 (b,d).


1. (C) SUMMARY: President Aliyev told Assistant Secretary
for Democracy, Human Rights and Labor Barry Lowenkron on
December 18 that the US and Azerbaijan need a "permanent
dialogue, every two months," in which we can address openly
and frankly issues related to Azerbaijan's democratic
development. Aliyev agreed with A/S Lowenkron's suggestion
that Foreign Minister Mammadyarov head the Azerbaijani side
and asked Mammadyarov to travel to the US as early as
February. Underscoring Azerbaijan's commitment to
Euro-Atlantic values and integration and the coincidence of
US and Azerbaijani goals in the bilateral relationship,
including democracy, Aliyev argued that Azerbaijan is
unfairly held to a higher standard than others in the region.
Aliyev also said that with US and Turkish support, it will
not be difficult for Azerbaijan to join NATO, but this step
must be taken when "the time is right" and in a way that
minimizes risks of a negative reaction from Azerbaijan's
neighbors. Aliyev outlined for Lowenkron his desire to be
remembered as a leader who made Azerbaijan a modern nation,
politically and economically. He opposed any decision to
sign into law pending US legislation to block USG financing
for a new regional railroad, and again urged greater US
commercial engagement in Azerbaijan's development projects.
END SUMMARY.


2. (C) After an introductory meeting in his office on
December 18 (septel),President Aliyev hosted a dinner for
Assistant Secretary Lowenkron. The Ambassador and Foreign
Minister Mammadyarov attended.

Dialogue on Democracy
--------------


3. (C) Pointing to the framework Azerbaijan is putting in
place for democratic development, A/S Lowenkron asked Aliyev
how we can work together going forward on this key element in
the bilateral relationship. Aliyev replied that we need "a
permanent dialogue, conversation, consultation." This
approach "completely fits with our agenda - for us it is also
one of the goals of development. We want Azerbaijan to be
modern. We have the opportunity" to achieve this goal with
Azerbaijan's new oil wealth. Aliyev said that he has visited
the US, Europe, Asia and the Muslim world. "I see where the
success stories are - some say Azerbaijan has oil wealth and
that's enough, but we need modernity in everything, in
political development, in economic development, for the
people to be proud," Aliyev said. Aliyev pointed to his
programs to send Azerbaijani students abroad and to provide
internet access in all schools in Azerbaijan to ensure wide
access to information as two key steps to develop Azerbaijan
as a modern nation.


4. (C) Aliyev said that general modernization of the country,
the building of roads, bridges, hospitals and schools, is key
for the Azerbaijani people after centuries of being deprived
of their right to enjoy the benefits of Azerbaijan's oil
wealth - wealth which was "barbarically extracted by the USSR
leaving behind great environmental damage." In seeking to
modernize the country economically, it is impossible to avoid
political modernization, Aliyev said. "When my term ends, I
want to tell my people I achieved modernization."


5. (C) Underscoring again that the US and Azerbaijan should
engage in regular dialogue on Azerbaijan's political
development -- "we need that, we would like that to be more
intensified" -- Aliyev argued that Azerbaijan is one of the
"best" in the region. Democratic development in Azerbaijan,
he stated, "is not behind Georgia -- Georgia has arrested and
put oppositionists in prison -- but there is a perception
that Georgia is the showroom for democracy. In fact, we and
Georgia talk more or less the same language." Aliyev noted
that perceptions of Azerbaijan are tinged due to the facts
that it is a Muslim country, an oil-rich state, and that he
succeeded his father. Misperceptions of Azerbaijan are
fueled by the efforts of the Armenian lobby working against
Azerbaijani interests in the US, the EU and Russia, Aliyev
said. The more successful Azerbaijan is, "the more they
fight, very often the strikes are coming from them," he said.
Perceptions put Azerbaijan in the worst position, but "look
at the South Caucasus, compare us to our neighbors,
Azerbaijan is surrounded by not very progressive states like
Russia, Iran, Kazakhstan, and Armenia. Sometimes it seems

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like we should be Sweden, while everyone else can be what
they are."


6. (C) Aliyev agreed with A/S Lowenkron that we need a forum
in which to raise difficult issues on democracy and human
rights frankly, saying that it is very important that the US
and Azerbaijan "have a really open and candid dialogue, to
exchange views, discuss and send messages.' Azerbaijan is
not perfect, Aliyev acknowledged. "We make mistakes,
sometimes we must admit it is our fault, sometimes it is
historical." He suggested that it would be good to continue a
"permanent dialogue every two months," underscoring that "our
goals coincide 100 percent." Aliyev agreed with Assistant
Secretary Lowenkron's suggestion that Foreign Minister

SIPDIS
Mammadyarov head the dialogue on the Azerbaijani side and
said Mammadyarov should travel to the US as early as
February.


7. (C) Aliyev noted that Azerbaijan engages in regular
interaction with other important partners including Turkey,
Georgia and Russia, with visits every month at the
ministerial level. Lamenting that he had tried
unsuccessfully some years ago to engage the EU - which "just
woke up to, and now understands" Azerbaijan's importance -
he emphasized that in contrast, he has seen the US as a key
partner since he spent almost two months in Houston in the
summer of 2001 to finalize the agreement on the BTC. "Our
goals coincide on energy, security and even the most
difficult subject, democracy," Aliyev reiterated. Foreign
Minister Mammadyarov interjected that while our goals and
strategy coincide, it is sometimes difficult for Azerbaijan
to see clearly how to implement democratic change. There may
be steps that Azerbaijan should take and does not, and "these
we should discuss openly and frankly with a minimum of
diplomacy," he said. "Sometimes we are criticized and we
don't know why."


8. (C) Assistant Secretary Lowenkron pointed to the
particular importance of regular and serious bilateral
engagement on human rights and democracy given continuing USG
concern with respect to due process for those imprisoned, as
evidenced by Senator McCain's recent letter regarding several
high-profile cases. Noting that he has met and has great
respect for Senator McCain, Aliyev said he does not
understand and regrets the Senator's involvement. He
recalled past instances in which some senior USG officials
had congratulated him on electoral successes privately, while
others, including Senator McCain, the Embassy and the State
Department, had levied criticism in the press and in public
statements. These experiences were "a great shock and very
painful." Aliyev concluded that "we need more contacts, and
more information on what's happening here, to avoid such
misunderstandings in the future."


9. (C) Aliyev agreed that human rights is a key element of
development but in Azerbaijan, the issue "seems monopolized
by NGOs and the opposition, and by NGOs that are used by the
opposition as 'branches'," Aliyev said. Civil society in
Azerbaijan is still very weak. Opposition-related NGOs get
grants and treat them like a business, sharing the funding
with the opposition parties, often "fighting over who got
what," Aliyev alleged.

NATO
--------------


10. (C) Aliyev told Lowenkron that he believes Azerbaijan
would have a good chance of joining NATO with the support of
Turkey and the US. Georgia has declared its intention to
join publicly, but does not enjoy the same degree of support.
It "will not be difficult" for Azerbaijan to join NATO, but
"it should be done at the right time," Aliyev noted. Just as
with the Baku-Tblisi-Ceyhan and Baku-Tblisi-Erzerum
pipelines, Azerbaijan must move "consistently, but minimizing
risks," to achieve its objective. In the case of the
pipelines, Azerbaijan's "neighbors did not realize" until the
projects were well underway what the implications were. This
was because Azerbaijan pursued these projects with "no
political agenda," in a "very businesslike" manner.

Russia
--------------


11. (C) Russia is "very stupidly trying to use gas and

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migrants against us," Aliyev said. By next year, he averred,
Azerbaijan will have developed its own gas resources and
Russia will no longer have leverage through gas and in four
to five years, as Azerbaijan develops economically, Russia
will no longer have leverage through migrants -- "Russian
migrants will be coming here." In response to A/S
Lowenkron's comments on Putin's "managed democracy," Aliyev
said that Putin "really believes - he has told me many times
- that the US overthrew Shevardnadze, your closest friend."
For countries like Azerbaijan from the former Soviet empire,
it is very important to see a fair, just approach on the part
of its international partners. Putin says the West has
double standards, but so does Russia, in Aliyev's view.
Russia installed a puppet regime in Chechnya so it could
claim and react to "terrorism." "We lose confidence when we
see" such actions, Aliyev said. Azerbaijan is not a big
country and so must always be alert for when and from where
danger may come. Russia has been re-establishing its
position over the past two years in Central Asia -- in
Uzbekistan, Kyrgyzstan and Kazakhstan. Kyrgyzstan was a
"Russian orchestrated change of President, there is a 100
percent Russian President now."


12. (C) Aliyev opined that Cuba, as a poor and completely
totalitarian country, could change dramatically overnight
just as the USSR did under Gorbachev. "He opened a small
window, and a big river that he could not control" came in.
Aliyev said that Azerbaijan considers Gorbachev "a criminal"
for sending troops to kill Azerbaijanis and for his support
for separating N-K, which ultimately led to the USSR's
collapse. Azerbaijanis had a unique experience living under
the Soviet system and even for young people today the Soviet
mentality that the State "owes you, is obliged to care for
you," lingers.

Azerbaijan's Development
--------------


13. (C) Aliyev outlined for A/S Lowenkron his intention to
create an American-style university in Azerbaijan to provide
the education, research and think-tank capacity the country
currently lacks. Government decision-making at present is
"by intuition" in the absence of policy and decision making
capacity and process, Aliyev said, adding that "the US style
of decision-making is the best." Mammadyarov added that the
goal is to create a new generation that understands
government as government, and business as business, and how
to separate the two.


14. (C) Aliyev said it is important to create the think tank,
social and university infrastructure, and the modern
services and facilities, to support a standard of living that
will allow Baku to develop as a center for regional
researchers. In the past Azerbaijanis would go to Turkey.
Now, "we need to create such a country that our children
will never think of going to live somewhere else and the
Turks will come here. We are working on that - we already
see the first signs." Azerbaijan is a multi-ethnic and
multi-religious society. "We want to protec and stimulate"
this identity and are "working o preserving this spirit,"
Aliyev said.


15. (C Stating that "Azerbaijan is the only real secular
country in the Muslim world with a predominantly uslim
population," Aliyev said that Azerbaijan's secular identity
is not an issue with other Muslim countries, even with Saudi
Arabia. Once Iranian President Ahmadinejad had tried to
raise the issue with him; "I said, the Jews are our
brothers," Aliyev noted, adding that "it is very important to
be straightforward" with the Iranians. Aliyev said he does
not allow Islamic sects to put money into building mosques in
Azerbaijan ("there is a danger of Wahabbism from there")
but he has financed from the state budget the building of
some mosques and the provision of headquarters for the Sheikh
who heads the Caucuses Muslim board. He said that it would
be better to build schools from the perspective of the
development of the country. In Azerbaijan's southern
regions, near the border with Iran, Aliyev said he instructs
his officials to help with "concerts, discos, pop performers
from Baku to orient people to these values, not elsewhere."

Railroad
--------------


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16. (C) Aliyev said he understands there is legislation
awaiting the President's signature to block USG financing for
the Kars-Akhalkalaki-Baku railroad. He said he does not
understand how the US could support the BTC pipeline and
oppose the railroad. If Armenia liberates the occupied
territories, it can participate in the project. Azerbaijan
has provided a $200 million loan to Georgia to support the
railroad. If the President decides to sign this legislation,
it will mean the US is supporting Armenian interests over
Azerbaijan's and Turkey's interests and this will be a
"painful political decision."

US Commercial Engagement
--------------


17. (C) Aliyev renewed his plea for more US commercial
engagement in Azerbaijan, especially investors and service
providers in connection with Azerbaijan's major industrial
development program to be financed by the new State
Investment Company. Through this company, foreign companies,
including SMEs can participate in projects to be financed by
the state budget. The French are very active in sanitation
and the Chinese in water projects. Azerbaijan is building
ten new hospitals in the regions, with plans to build up to
50 in the next three years. Siemens recently beat General
Electric on a project in Nakhchivan because of its presence
in Azerbaijan. Aliyev recalled that State Department
Commercial and Business Advisor Frank Mermoud had offered to
help engage the National Association of Manufacturers'
interest in Azerbaijan and said he would be interested in
following up.

Comment
--------------


18. (C) A/S Lowenkron's two separate extended talks with
President Aliyev (septel) indicate that he can "talk the
talk" when it comes to what Azerbaijan needs to do in the
coming years to successfully transition to a viable
market-based democracy, with the main question being one of
whether he "walks the walk" on implementation. We will work
closely with Washington to make optimal use of Aliyev's call
for increased US dialogue on democracy.


19. (U) A/S Lowenkron cleared this message.
HYLAND