SRI LANKA: TRO DESIGNATION WELCOMED BY GOVERNMENT

C O N F I D E N T I A L SECTION 01 OF 03 COLOMBO 001565

SIPDIS

SIPDIS

DEPT FOR SCA/INS, S/CT, AND EEB/ESC/TFS
TREASURY/TSDN FOR J PHILIPP, P LURIE AND M DRAKE

E.O. 12958: DECL: 11/16/2012
TAGS: KTFN PTER PREL SL
SUBJECT: SRI LANKA: TRO DESIGNATION WELCOMED BY GOVERNMENT

REF: SECSTATE 156467 & SECSTATE 156985

Classified By: Ambassador Robert O. Blake, Jr. for reasons
1.4 (b) and (d).


1. (C) Summary and comment: Ambassador informed the
Government of Sri Lanka the evening of November 15 of the
forthcoming U.S. designation of the Tamils Rehabilitation
Organisation shortly before Treasury's Washington
announcement of the Executive Order 13224 designation. The
government welcomed the move and thanked the United States
for its support against the Liberation Tigers of Tamil Eelam.
Major newspapers reported the U.S. freeze TRO assets on
their front pages. The Ambassador held a press conference
the day after the Treasury action to describe the U.S.
measures and their implications. The Australian, Canadian,
and British High Commissioners appreciated receiving advance
notice of the U.S. action. Each predicted accurately that
the government would seek to make maximum political gain from
the designation. End summary and comment.

GOVERNMENT WELCOMES TRO DESIGNATION
--------------


2. (C) Ambassador informed Sri Lankan Foreign Secretary
Palitha Kohona by telephone at 7:30pm Colombo time November
15 that the United States Treasury was about to announce
designation of the Tamils Rehabilitation Organisation (TRO)
under Executive Order 13224 (reftel). Kohona said the news
would be very welcome and thanked the United States for its
continued strong support of Sri Lanka as it defends itself
against the ethnic separatist Liberation Tigers of Tamil
Eelam (LTTE).


3. (U) The government-run Daily News today quoted Foreign
Minister Rohitha Bogollagama saying that "the United States
was the first government to take tangible action against an
LTTE front organization." Bogollagama added "As has been
pointed out by Sri Lanka for some time, the proscription of
the LTTE has been undermined by the continuing ability for
front organisations of the LTTE, particularly the TRO, to
continue collecting funds to beef up the LTTE arsenal."
Press reports later in the day cited Bogollagama saying that
the government would ban all TRO activity in Sri Lanka.

MEDIA GIVE FRONT PAGE COVERAGE
--------------

COLOMBO 00001565 002 OF 003




4. (U) Major Sri Lanka newspapers today reported the U.S. TRO
designation as front page news. The Ambassador also held a
press conference today to discuss the U.S. action against the
TRO. In his prepared remarks he emphasized that the United
States was committed to enforcing its laws against support
for designated terrorist groups wherever they operate. He
explained the basis for the U.S. designation of the TRO and
noted that it was "an action against the LTTE, not against
the Tamil people." He affirmed U.S. "support for a just,
negotiated political settlement to the conflict that meets
the aspirations of all communities, including Sri Lanka's
Tamils."


5. (U) In response to a reporter who cited a Tamil National
Alliance statement that the TRO designation would encourage
the government's "military agenda," the Ambassador disagreed,
stating the designation was an action against the financing
of terrorism and did not change the U.S. view that no
military solution to the conflict was possible. To a
question regarding the view that the LTTE had in the past not
negotiated for peace in good faith, the Ambassador noted that
the United States' recent provision of radar and small craft
was intended to make the LTTE realize that it would not
become easier for the group to replenish its arms, and that
the LTTE should not expect to get a better political deal by
prolonging the conflict. Asked the value of the TRO assets
frozen, the Ambassador replied that we do not release that
information.

TAMIL HERO SAYS PEOPLE WILL SUFFER
--------------


6. (SBU) Also today, Ambassador met with elderly Sri Lankan
Olympic and cricket hero Nagalingam Ethirveerasingham, a
Tamil who has close connections to the TRO and some in the
LTTE leadership. Ethirveerasingham was subdued about the TRO
designation, saying it came as a surprise. He added that the
impact of the freeze was less significant to the LTTE than to
displaced persons and tsunami victims, who would suffer as a
result of it. He said he hoped the TRO might be able to
establish that it was fully independent of the LTTE, just as
his own sports organization had by having its own governing
council, financial means, and operations manual. He expected
that TRO would engage lawyers to explore appeal or
de-listing.


COLOMBO 00001565 003 OF 003


AUSTRALIA, CANADA, UK NOT SURPRISED
--------------


7. (C) DCM and EconOff on November 15 informed the
Australian, Canadian, and British High Commissioners of the
forthcoming TRO designation. None had heard from their
capitals about consultations that the USG had initiated on
the topic, but they were not surprised to hear of the United
States' planned action. All agreed that TRO does genuine
humanitarian work but appeared likely to have functional
links to the LTTE. Australian High Commissioner French said
that his government had conditioned financial assistance to
partners in Sri Lanka on none of the money going to the LTTE
or the TRO. Canadian High Commissioner Bogdan thought the
U.S. freeze on TRO might cause the group to shift its
activities to Canada to make up the shortfall in revenue from
the United States. Acting British High Commissioner
Owen-Edmunds asked what the implications of the asset freeze
would be on multilateral organizations like UNICEF, some of
which worked with the TRO.


8. (SBU) Action Request: Post would still welcome guidance,
if possible, on the implication of the designation for
multilateral organizations like UNICEF which funded TRO
relief work in the past. We do not have details, but it
appears possible that some multilateral agencies may continue
to have programs involving TRO as an implementing partner.


9. (C) Comment: Post will report further on media,
government, and public reactions to the TRO designation. It
is already clear that, as expected, the government is playing
the U.S. action as a major show of support for the government
and against the LTTE. Tamil politicians are also reacting
through a political lens. Upcountry People's Front Member of
Parliament P. Radhakrishnan, who is a member of the governing
coalition, told PolOff he was disappointed with the U.S.
action, which would "strengthen the hand of the government
against minorities."
BLAKE