SCENE SETTER FOR THE VISIT OF OSD PRINCIPAL

C O N F I D E N T I A L SECTION 01 OF 05 BANGKOK 000358 SIPDIS SIPDIS OSD PLEASE FORWARD TO BRIGADIER GENERAL TOOLAN MANILA PLEASE PASS TO BRIGADIER GENERAL TOOLAN E.O. 12958: DECL: 01/17/2017 TAGS: PGOV PREL OVIP MARR MASS TH SUBJECT: SCENE SETTER FOR THE VISIT OF OSD PRINCIPAL DIRECTOR BRIGADIER GENERAL JOHN A. TOOLAN, JR. Classified By: Ambassador Ralph L. Boyce. Reason 1.4 (a and d) ¶1. (C) Summary. General Toolan, your visit to Bangkok will be the first by a senior Pentagon official since the September 19 coup in Thailand and will provide an excellent opportunity to press Thai officials to rescind martial law and maintain timetables for drafting a new constitution and holding elections. After a three month honeymoon with the domestic media and intelligentsia, the Council for National Security (CNS) is under increasing criticism for imposing limits on press freedom and displaying economic ineptitude. Public confidence in the effectiveness of the junta to manage the country, let alone reform politics, is dropping. Despite our concerns over the return to democracy, Thailand remains important to U.S. strategic interests in the region. Thailand affords the United States a unique platform in Asia. Our largest exercise, Cobra Gold, is America's only annual joint/combined multilateral training exercise in the Asia Pacific Region and includes the active participation of Japan, Singapore and Indonesia. You can explain to the Thai that the policy decision whether the United States will participate in Cobra Gold in 2007 will be made at senior levels in Washington and will be determined in large part by how effectively the Thai fulfill their commitment to lift martial law and return to democracy. Thai troops deployed to Afghanistan and Iraq and we are working closely with the Thai to make them better able to address separatist elements in the Muslim majority South. Before the coup, working with PACOM and other U.S. embassies in the region, we had won Thai endorsement of joining a regional maritime security network to create a layered approach providing coverage of the northern shipping lanes feeding into the Strait of Malacca. END SUMMARY. THE POLITICAL SITUATION ¶2. (C) Most in the Thai media and chattering class welcomed the September 19 coup d'etat that removed former Prime Minister Thaksin Shinawatra and ushered in the military-led Council for National Security (CNS). CNS chair General Sonthi Boonyaratklin and the military were able to capitalize on popular opposition to Thaksin, particularly within Bangkok and the monarchy, to topple Thaksin's government. The swift selection of respected privy councilor General Surayud Chulanont as Prime Minister, the appointment of a qualified civilian cabinet, and the promulgation of a timetable to draft a new constitution and to hold a national election were seen as hopeful signs that the CNS was dedicated to democratic principles. Recently, however, the CNS has been pummeled in the press for a number of missteps including not moving quickly enough to investigate corruption by Thaksin officials, a ham-fisted attempt to control the rising baht that resulted in the stock market plunging 14 percent in a single day, failure to respond effectively to a rash of bombs that went off in Bangkok on New Year's Eve, and a general perception of incompetence. Critics have also raised concern that the interim legislature appointed by the CNS is not representative of Thai society and that the initial framework under which the new Constitution was to be drafted favors elite interests. CNS Secretary General Winai Phattiyakul has been criticized for telling the press not to run stories about Thaksin -- although Winai denies reports he threatened the media if they would not cooperate, the electronic media is engaging in obvious self-censorship. ¶3. (C) The CNS has not yet demonstrated an ability to govern effectively or to steer Thailand through the difficult months ahead. Further complicating issues are recent rumors, so far unsubstantiated, that some hard-line members of the CNS might sponsor a new coup to push out CNS moderates or Cabinet members who are not responding adequately to political challenges. Regarding martial law, Embassy officials have raised repeatedly our desire that the CNS move with dispatch to return the country to the situation that BANGKOK 00000358 002 OF 005 existed prior to the coup -- when martial law was in effect in a limited number of border areas. It would be useful for you to echo this sentiment. We have also emphasized the need for the CNS not to let milestones slip in drafting a new constitution and holding elections. We have requested meetings for you with a number of key officials and hope you will underscore all these points, emphasizing the Washington perspective. THE BILATERAL RELATIONSHIP ¶4. (C) Prior to the coup, bilateral relations with Thailand were very good and we are optimistic that this will be the case after a new government is in place. The goodwill generated by America's quick and massive response to the December 26, 2004 tsunami was palpable. Thailand is a Treaty Ally and has been firmly supportive of the International War on Terror and has participated in Operation Enduring Freedom (OEF) and Operation Iraqi Freedom (OIF). American businesses have over $20 billion in direct investment in Thailand. The United States is Thailand's largest export market and its second-largest foreign investor. ¶5. (C) Senior officials have not been as energetic in supporting our policy efforts on Burma as we had hoped. The new Thai approach of not actively defending Burma, however, is an improvement over Thaksin's policy of "constructive engagement" with the military junta in Burma. THE OVERALL SECURITY RELATIONSHIP ¶6. (C) The U.S.-Thai security relationship is based on over 50 years of close cooperation. Thai soldiers, sailors and airmen participated in the Korean and Vietnamese Conflicts and Thai peacekeepers served in Afghanistan and Iraq. Prior to coup sanctions, Thailand was the fourth largest participant in the U.S. International Military Education and Training (IMET) program. Thailand's willingness to allow the United States to use Utapao Naval Air Station as the hub for our regional tsunami assistance program was key to making Operation Unified Assistance a success. In fact, PACOM recently designated Utapao as the most important Cooperative Security Location (CSL) in the Asia Pacific Region. While we avoid using the term "CSL" with the Thai due to their sensitivities about bases, Utapao remains vital to our interests in the region. In your meetings with Thai military officials, you will want to note our desire to return to a more healthy military-military relationship once a democratically elected government is in place. COUNTERTERRORISM AND SOUTHERN THAILAND ¶7. (C) Until recently, Thailand's biggest domestic challenge was the unsettled security situation in the far southern part of the country. Southern Thailand, in particular the southernmost Muslim majority provinces of Pattani, Yala, and Narathiwat, has experienced episodic violence since it was incorporated into the Siamese Kingdom in 1902. However, since January 2004, we have witnessed a dramatic increase in the level of violence. Press reports indicate that over 1,900 persons have been killed either by militants or by security forces during this period. Local Muslim separatist militants have attacked symbols of Thai and Buddhist authority, civilians, and local citizens suspected of collaborating with the Government. Thaksin was sharply criticized for not having an effective policy to curb violence in the South. Despite initial optimism that the CNS under General Sonthi might be able to make progress, the new government has not demonstrated an improved ability to counter the unrest in the near term. ¶8. (C) Southern separatists direct their anger at the government in Bangkok, not at the United States. Since a U.S. presence or perception of U.S. involvement in the South BANGKOK 00000358 003 OF 005 could redirect that anger towards us and link it to the international jihadist movement -- a link that is currently absent -- we ensure that any offers of assistance or training pass the "location and label" test. Put simply, we keep U.S. military personnel away from the far South and we make sure that we do not label any assistance or training as directly linked to the southern situation. Likewise, we work to avoid feeding rampant, outlandish speculation that we are somehow fomenting the violence in the South in order to justify building permanent bases -- a very sensitive issue in Thailand. We do not want to jeopardize our access to key military facilities in Thailand like Utapao Naval Air Station. ¶9. (C) Although some of our tools to work with the Thai military on Southern issues have been affected by coup sanctions, the Embassy maintains a three-pronged focus to improve our military cooperation in order to address the violence in the South: --1) Using our exercise and training program to improve the professional and operational skills of the Royal Thai Armed Forces, especially the Thai Army; --2) Help the Thai break down stovepipes between the Thai military, police forces, and civilian agencies; --3) Do everything we can to ensure the Thai respect international human rights norms as they counter the violence. MILITARY EXERCISE PROGRAM ¶10. (C) Thailand gives the U.S. military a platform for exercises unique in Asia. Thailand offers the United States military good base infrastructure, large areas in which our aircraft and ground forces can conduct unrestricted operations and access to bombing ranges -- all in short supply in Asia. Located near strategic maritime choke points and having good liberty ports, Thailand also has the potential to play a greater role in U.S. Naval planning. Perhaps due to their lack of a colonial heritage, Thai leaders are far more willing to host multilateral exercises than are other countries in Asia. Unlike Japan, which only hosts annual bilateral exercises due to legal prohibitions over collective security, or Australia, which avoids multilateral exercises so as not to "dumb down" its own training opportunities, the Royal Thai Government supports multilateral exercises as a way to show regional leadership. This has allowed us to use our exercises in Thailand to further key U.S. objectives such as supporting Japan's growing military role in Asia and engaging the TNI. The Thai are aware that we only approved this year's COPE TIGER air exercise after high-level discussions in Washington and will be eager to hear from you whether we will likely proceed with COBRA GOLD this year. This conversation again will afford you an opportunity to underscore steps the CNS and interim government can take that would allow Washington to approve COBRA GOLD. THE ROLE OF CHINA AND INDIA IN THE REGION ¶11. (C) Southeast Asia continues to feel the rising influence of China and India. While emphasizing the vital role of the U.S. in the region -- and Thailand's desire to intensify U.S. engagement -- Thai leaders also focus on developing stronger relations with the two regional powers. Bangkok views both countries as sources of unlimited consumer demand and hopes to conclude Free Trade Agreements with both nations. The Thai military has a number of Chinese weapons systems in its arsenal. While Thai military links with the United States are deeper and far more apparent than Sino-Thai links, China's growing influence in Thailand and Southeast Asia is evident in business, the arts, the media and the military. The PLA Navy has close links with the RTN and recently conducted a major ship visit to Phuket. After jointly holding a limited naval exercise in the Andaman Sea in 2005, BANGKOK 00000358 004 OF 005 Thailand and China are exploring conducting joint SAR exercises. The RTN has acquired several ships from China over the past decade. China is refurbishing tanks and air defense equipment provided to Thailand in the late 1980's. Mil-to-mil exchanges between China and Thailand have expanded in recent years as has the number of bilateral military VIP visits. REGIONAL MARITIME SECURITY ¶12. (C) A key U.S. objective in the region is to improve maritime security. As part of an effort funded by Section 1206 of the National Defense Authorization Act of 2006, we worked closely with PACOM and sister Embassies in Manila, Kuala Lumpur, Jakarta and Colombo to develop a regional maritime security architecture to improve communications, domain awareness and intercept capabilities in the waters surrounding Southeast Asia. The Thai portion of the initiative, approved by Congress but suspended as part of coup sanctions, was a layered approach to assist the Thai military secure territorial waters while also providing coverage of the northern shipping lanes feeding into the Strait of Malacca. We hope to revisit this initiative and work closely with neighboring countries when Thailand returns to a democratic government. THE ROLE OF THE ARMY ¶13. (C) The Royal Thai Army (RTA) is a legacy force faced with serious modernization issues. The RTA is still primarily designed to defeat the large conventional threat that Vietnam represented in the mid-1980's. On paper, the RTA would seem to possess the capability to defeat a large conventional attack -- however, it is plagued by an almost universally low Operational Readiness (OR) rate. This problem is a systemic weakness based on insufficient sustainment of equipment as well as budget shortages since the 1997 financial crisis. ¶14. (C) Much of this decline in effectiveness is due to the budget constraints that were imposed from 1997-2001 after the Asian Financial Crisis. Since that time, budgets have increased slightly, but not to pre-1997 levels. Correcting this military budget shortfall is a key focus of CNS leaders and there is a strong likelihood that the interim government will expand the defense budget, allowing all the services to improve their capabilities. ¶15. (C) While the RTA has a long history working with the U.S. Army, recently we have also been working with MARFORPAC and III MEF to improve links between the U.S Marine Corps and the RTA. In many ways, our Marines are perfect training partners for the RTA and field exercises in Thailand afford our Marines many opportunities they don't have elsewhere in Asia. We have explored hosting the USS Essex Amphibious Assault Ship and will look for other training opportunities in the future. THE NAVAL RELATIONSHIP ¶16. (C) While our overall relationship with the Thai military is good, our links with the Royal Thai Navy (RTN) are not as strong as those with the Royal Thai Army or Air Force. The RTN is smaller than the other services and tends to be less willing to be open with U.S. counterparts. In the past we have had a better relationship with the RTN and we were working to reverse the current trend through potential projects like the 1206 Andaman Sea Maritime Security Initiative. Prior to the coup, we worked with PACFLT and Seventh Fleet to increase the tempo of U.S. Navy ship visits. Recent U.S. aircraft carrier visits were well received by the RTN, received front page and prime time media coverage, and were successful opportunities to demonstrate the benefits of the U.S.-Thai security relationship. Recently, the Chinese have improved their ties to the RTN as mentioned BANGKOK 00000358 005 OF 005 above. Likewise, the RTN has been developing a closer relationship with the Indian Navy and has conducted some exercises with the Indians. ¶17. (C) In addition to supporting our annual Cooperation Afloat Readiness and Training (CARAT) exercise with Thailand, JUSMAGTHAI has worked closely with RTN Special Warfare units to increase their capacity. USN SEALS have helped to provide their Thai counterparts with some impressive capabilities. For instance, Thai SEALS regularly conduct exercises aimed at protecting oil and gas platforms in the Gulf of Thailand. This NSW relationship was graphically demonstrated during the tsunami response when USN and RTN SEALS rapidly deployed to SIPDIS Phuket to assist in the recovery efforts. The Prime Minister was photographed in a recovery boat manned by the SEALS. Despite their improved professionalism, the Thai SEALS are not well-supported by senior RTN officials. THE AIR FORCE RELATIONSHIP ¶18. (C) The annual COPE TIGER flight training exercise among the United States, Thailand and Singapore is scheduled to run from January 29 until February 9 in Thailand. COPE TIGER is the largest joint/combined air combat exercise in Thailand. Since its beginning in 1994, COPE TIGER has evolved into a multinational exercise conducted in two phases. Phase one was a tactical seminar/command post exercise coupled with a final planning conference that took place in Singapore from December 11-16. The flying training exercise is scheduled to take place at Korat Air Force Base in Thailand from January 29 until February 9. U.S. Marine Corps aircraft scheduled to participate in COPE TIGER are based in Japan and hope to conduct warm weather operations in Thailand. U.S. Air Force aircraft include A-10 ground support aircraft based in Korea. The A-10s hope to conduct ground support training that they only have a limited ability to conduct in Korea. ¶19. (C) In 2005, Thailand announced its plans to replace aging F-5s in the RTAF fleet. Former Secretary Rumsfeld, Secretary Rice and the President all urged Thailand to either SIPDIS use its defense budget to perform mid-life upgrades (MLU) on its existing F-16s and/or to buy F-16 Block 52s. A vast majority of senior RTAF officers favor the F-16 over SU-30. However, Russian officials and Israeli contractors have reportedly offered inducements to senior RTAF officers to buy Russian planes and former PM Thaksin reportedly promised President Putin that he would look favorably on Sukhoi's bid. We are urging the Thai to proceed with the MLU purchase or procure new F-16s but not to procure any Russian planes for interoperability reasons, the impact such a move could have on technology releases in the future, and the effect such a procurement might have on Thailand's ability to eventually purchase the Joint Strike Fighter. WE LOOK FORWARD TO YOUR VISIT ¶20. (U) I look forward to hosting you for dinner when you come to Bangkok and to sharing views on how best to promote our strategic interests in Thailand. BOYCE