CODEL ISSA MEETS WITH PA PM FAYYAD

C O N F I D E N T I A L SECTION 01 OF 02 JERUSALEM 001303

SIPDIS

SIPDIS

NEA FOR FRONT OFFICE AND IPA, PASS NSC FOR ABRAMS/SINGH AND
WATERS, L FOR JONATHAN SCHWARTZ

E.O. 12958: DECL: 06/25/2017
TAGS: IS KPAL KWBG PGOV PREL
SUBJECT: CODEL ISSA MEETS WITH PA PM FAYYAD


Classified By: Consul General Jake Walles for reasons 1.4 (b) and (d)


1. (C) Begin Summary. Palestinian Authority PM Salam
Fayyad told CODEL Issa June 24 that West Bank security is his
first priority, and he will seek GoI coordination for the
movement of the PASF between West Bank cities. He said
improving access and movement in the West Bank is his second
priority. Fayyad said he wants the GoI to transfer
Palestinian clearance revenues immediately and without
protracted negotiations to enable the PA to pay salaries. He
said that USG financial assistance will be important in the
medium term to provide the PA with a show of confidence and
to consolidate its authority. He also requested the State
Department file statements of interest in lawsuits against
the PA in U.S. courts, which he said threaten PA solvency.
End Summary.

Cooperation with ISRAEL - Especially on Security
-------------- ---


2. (C) In a June 24 meeting with Representative Darrell
Issa (R-CA) and the Consul General, Palestinian PM Salam
Fayyad said he wants to work with the GoI on an urgent basis.
He asked that the USG urge the GOI to engage positively with
the PA and to support Palestinian efforts to stabilize the
West Bank. Fayyad said he wants a new Israeli attitude, as
well as Israeli actions on PA requests, including clearance
revenues, West Bank checkpoints and prisoner releases. He
said he understands Israeli skepticism about the PA's ability
to secure the West Bank, but he will do everything possible
to earn credibility by demonstrating results rather than
making demands.


3. (C) Fayyad said his first priority is West Bank
security, which requires Israeli cooperation to move the PASF
between West Bank cities. He said the PASF and IDF share
lawlessness and militias as common enemies, and he wants to
fight them. To do this, he said, he needs to move the PASF
between West Bank cities and also to identify the fugitives
whom the IDF is looking for. If the PASF and the IDF operate
in the same city, he noted. the PASF will either engage the
IDF or flee, and either result will undermine PASF
credibility.


4. (C) Fayyad also urged the removal of West Bank
checkpoints, which he said hurt the economy and "depress
people." He said Palestinians "need to see that we are
serious about law and order and, they need to be able to
move." Progress on these two fronts, he said, will be felt
immediately and will create optimism. Fayyad added that the
separation barrier had made many internal West Bank
checkpoints redundant.

Transfer Clearance Revenues without Delay
--------------


5. (C) Fayyad said the PA urgently needs an injection of
funds, and clearance revenues are the only immediate source.
He said he wants the funds transferred immediately, without
long, drawn-out negotiations. He recalled the protracted
negotiations in 2002 and said a replay will weaken the PA,
delay payment of salaries, and allow the development of
internal opposition in ISRAEL to the transfer. He said "too
much public discussion will make the transfer hard to do.
It's our money. We want it transferred in an accountable
way. And done." Fayyad noted that the GOI has not contacted
him to discuss the details of transferring the clearance
revenues.


6. (C) Fayyad said the clearance revenues will be more
helpful in the immediate term than any USG financial
assistance, because it can be done quickly. Fayyad said
there are also Arab financial commitments, and now is the
time to release the funds in the Arab pipelines.

US Assistance, Financial and Legal
--------------


7. (C) Fayyad said that the PA needs USG assistance to
provide the government "breathing room" to establish itself
and to show confidence in the new government. He expressed
great appreciation for the OFAC general license that allows
transactions with the PA and noted he will present the
license to the cabinet. He said he wants Palestinians to be
aware of this "significant development."


8. (C) Fayyad also discussed the impact of domestic lawsuits
in the U.S. and ISRAEL against the PA. He said the PA is now
defending itself against such suits, but the default

JERUSALEM 00001303 002 OF 002


judgments against the PA have done great damage, as all PA
transactions in dollars are at risk of seizure as these
judgments are enforced. Fayyad said the GOI is cooperating
with Israeli attorneys hired by the PA on some cases, and he
hopes FM Livni will intervene with the Israeli court now to
block such suits. (Note: According to Fayyad, this is
possible under the Israeli judicial system. End Note.)
Fayyad asked that the State Department file a statement of
interest in the U.S. cases, which he believes will be
helpful.

Gaza and Follow-Up
--------------


9. (C) Fayyad said the PA must retain Gaza "as an integral
part of our homeland," but he noted that for now, his plans
focus on the West Bank, because he doesn't have full
authority in Gaza. Fayyad noted that he must soon decide
whether to pay the salaries of PA employees in Gaza.


10. (SBU) CODEL Issa encouraged Fayyad to visit Washington
and offered to facilitate meetings on the Hill "beyond the
usual suspects."


11. (U) CODEL Issa did not have the chance to clear this
cable.
WALLES