TANZANIA: DONORS INCREASINGLY WARY OF CORRUPTION

C O N F I D E N T I A L SECTION 01 OF 03 DAR ES SALAAM 001555 SIPDIS SIPDIS SENSITIVE DEPT FOR AF/E MBEYZEROV, AF/EPS FOR ABREITER AID WASHINGTON FOR AF OFFICE MCC FOR KFICKENSCHER, MKAVANAGH ADDIS FOR AU MISSION LONDON AND PARIS FOR AFRICA WATCHERS E.O. 12958: DECL: 11/16/2017 TAGS: EAID PREL PGOV ECON TZ SUBJECT: TANZANIA: DONORS INCREASINGLY WARY OF CORRUPTION REF: A. DAR ES SALAAM 1500 ¶B. DAR ES SALAAM 1009 DAR ES SAL 00001555 001.2 OF 003 Classified By: Deputy Chief of Mission D. Purnell Delly for reasons 1.4 (b) and (d). Summary -------------- ¶1. (SBU) In recent months, opposition leaders and the press have continued to batter the Kikwete administration with allegations of "grand corruption" at the senior-most levels of government related to the Bank of Tanzania, gold mining contracts, the "Richmond" power generation scandal, and a host of other high-profile corruption cases. Earlier this month the Director of the Prevention and Combating of Corruption Bureau was himself under attack in the press and on various Kiswahili internet sites. For the first time, donors have begun to raise questions about the magnitude of their assistance levels in the absence of genuine measures to confront corruption, aware that their respective governments and taxpayers may ultimately raise the same concerns. Donors engaged in direct budget support have expressed their concerns more forcefully that ever before to the government, insisting on greater transparency and better performance measures for their assistance. At the conclusion of the most recent donor review, the UK High Commissioner suggested future aid levels could actually be reduced. ¶2. (SBU) For our part, Ambassador Green has emphasized repeatedly in public statements that the MCC Compact is not a grant, but rather a package of reciprocal responsibilities, including a satisfactory grade on the corruption index each year over the five-year life of pact. He has also pointed to the corrosive effects of corruption on governance, while praising President Kikwete for creating a political climate in which a generally free press can investigate and expose malfeasance. We are concerned that indicators lag perceptions, and the perceptions here, both among donors and Tanzanians on the street, are that corruption is a growing problem, and that the political will may not exist to tackle it. If there is a silver lining to all this, it is that President Kikwete seems to appreciate the change in �A;perceptions here, and has vowed to take concrete measures shortly to signal corruption in his government will no longer be tolerated. End Summary. Donors Call for Answers to Corruption Allegations -------------- -------------- ¶3. (U) In a public statement on September 20, Dutch Ambassador Karel van Kestern became the first in a line of high-level officials from the donor community to address the recent barrage of corruption allegations against the GOT (Ref A),calling on the Kikwete administration to "issue timely and robust responses to the various allegations." In his statement, and in several subsequent interviews, Amb. van Kestern specifically referred to allegations of corruption contained in the "List of Shame" (Ref A) and specific instances of graft at the Bank of Tanzania (Ref B). He further noted that responses to the allegations against top officials are necessary to send positive signals to potential investors, governments, and taxpayers in donor countries. ¶4. (U) Shortly after, Belgian Ambassador and Chief EU Representative Peter Maddens publicly expressed disappointment that the GOT had failed to issue a comprehensive statement regarding the allegations, even though "in a democracy, the government is held to a higher standard than the opposition." German Charge d'Affaires Ingo Herbert called on the GOT to "give its side of the story as soon as it possibly can." ¶5. (U) On October 29, at a meeting of the 14 donors that provide general budget support to Tanzania (Britain, Canada, Denmark, Finland, Germany, Ireland, Japan, Norway, Sweden, Switzerland, The Netherlands, the World Bank, the EU, and the African Development Bank),British High Commissioner Philip DAR ES SAL 00001555 002.2 OF 003 Parham called on the GOT to strengthen accountability and combat corruption. High Commissioner Parham noted that it is important that the Kikwete administration be seen to proactively address the allegations made against it, explain where the allegations are misconceived, and prosecute where evidence warrants. He further stated that development partners feel less confident about Tanzania than they did a year ago. ¶6. (U) The above are but a few examples of statements concerning corruption in general, as well as concerning the specific allegations of grand corruption within the Kikwete administration, that have been made over the past twelve weeks by high-ranking officials from various donor countries and organizations. U.S. Mission Public Response -------------- ¶7. (SBU) During the same period, our own public message regarding corruption has focused on two areas. First, the Ambassador and other Mission representatives have provided strong public encouragement to the press, as local journalists continue to publish detailed and sometimes inflammatory investigative reports. The key theme of this message has been that a thriving, free press as an essential pillar of a liberal democracy, coupled with praise for President Kikwete and the GOT for maintaining an atmosphere of press freedom. Ambassador Green was widely quoted in the press after an October 31 event in which he commended journalists for their work, praised Tanzania as a place where the government respects press freedom and encourages scrutiny from the public, and encouraged the media to support President Kikwete's fight against corruption. ¶8. (SBU) Second, regarding Tanzania's MCC Compact (which numerous GOT officials, including Finance Minister Zakia Meghji, have publicly suggested is a signal that the U.S. considers Tanzania to be free of corruption),Ambassador Green and Mission representatives have stressed that the Compact is a partnership through which the U.S. and Tanzania can work to reduce poverty and promote transparency and accountability in government. The Mission has continually reminded its GOT counterparts, as well as the press, that the Compact will be evaluated each year, specifically focusing on the corruption/accountability indicator. Ambassador Green has been widely quoted in the local press on this issue, likening the signing of an MCC compact to a wedding and the five-year Compact relationship to a marriage, stating "A wedding is easy, but a marriage is hard." This statement in particular has become so identifiable with the Mission's message on corruption that a major Dar es Salaam newspaper recently repeated the Ambassador's analogy in a political cartoon in which one figure ("U.S.") hands another figure ("GOT") a bag labeled "$698". MCC Resident Country Director Karl Fickenscher has been widely quoted in the local press delivering the same message. Public Reaction -------------- ¶9. (C) As reported (Ref A),the public has become increasingly frustrated at perceived corruption within the GOT, and with a perceived lack of resolve on the President's part to fight graft within his administration. At present, the press is doing more to fight corruption in Tanzania than any other segment of society, and the press is certainly doing more than the GOT itself. While a few editorials have criticized the donors for meddling in internal affairs by "attaching conditions" to aid, the press has largely used the donors' remarks as a vehicle to continue their reporting on corruption in the GOT. Both media and public opinion has been far from critical of such statements, appearing to breathe a collective sigh of relief that someone in a respected position is speaking what is on the minds of so many Tanzanians. ¶10. (C) Reaction to Ambassador Green's and the U.S. Mission's DAR ES SAL 00001555 003.2 OF 003 statements has been extremely positive. This is in part because the public shares our concerns; in part because the press appreciates strong support from the USG for its own freedoms; and in part because the Mission's statements have not taken the blunter edge that other donors' statements have, but instead have praised President Kikwete's commitment to tackle corruption, while making clear we nevertheless await concrete results, and are concerned that the $698 MCC Compact could hang in the balance if the corruption indicator reverses direction. Comment -------------- ¶11. (C) There is a sea change underway here in the public perception of corruption. Ironically, this is because of the robust climate President Kikwete has created for a free press. It is also a result of globalization, and the proliferation of computers, e-mail, and even blogs here. The most damning allegations involving corruption at the Bank of Tanzania were circulated by e-mail together with attachments of actual spreadsheets from the Bank. The recent allegations leveled at the Director of the Prevention and Combating of Corruption Bureau appeared first on blogs, many of which are maintained by expatriates. In some senses, perhaps politicians here realize it is becoming too late to clamp down on the press, given the startling speed with which information -- including corruption allegations -- spreads on the internet. GREEN