KUWAIT: WHERE WE ARE AND CHALLENGES AHEAD --

S E C R E T SECTION 01 OF 03 KUWAIT 001101

SIPDIS

NOFORN
SIPDIS

E.O. 12958: DECL: 08/12/2014
TAGS: PREL ECON PGOV PTER KU
SUBJECT: KUWAIT: WHERE WE ARE AND CHALLENGES AHEAD --
AMBASSADOR'S END OF TOUR REPORT

Classified By: Ambassador Richard LeBaron for reasons 1.5 (b) and (d)


1. (C) This message summarizes my parting thoughts on key
issue areas in the U.S./Kuwait relationship. It draws
heavily on input provided by Matt Tueller, who recently
concluded a distinguished tour as Deputy Chief of Mission and
is en route to service at Embassy Baghdad. The report covers
five areas: security, counter-terrorism, economic relations,
democracy-building, and public diplomacy.

Projecting Military Force
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2. (S/NF) The ability to project a meaningful military
ground deterrent presence into the Gulf region will remain
the overriding interest in the U.S./Kuwait relationship.
From our initial insertion of forces through Kuwait into Iraq
for OIF until today, Kuwait remains the principal staging
point for hundreds of thousands of U.S. military personnel
and their associated equipment. The way in which we pursue
our other interests should be viewed in the context of
preserving Kuwait's unique willingness to host a very
significant U.S. ground presence. The GOK will continue to
support deployment of U.S. troops into Iraq, even as the form
in which we do this evolves into the next decade. CENTCOM
leadership and our Office of Military cooperation have done
an outstanding job in managing our military relations with
the Kuwaitis, through sustained dialogue at all levels,
masterful management of troop and equipment flows, and an
effective military sales and advisory program. We should be
alert to three factors that could influence our ability to
operate in and from Kuwait.

-- First, we cannot depend on the memory of Kuwait's
liberation by the United States to underpin the relationship
indefinitely. Kuwaiti youth will form their own opinions
about the role of the United States in their country and we
will need to push back against the image of the U.S. as an
enemy of Islam. This is one of the reasons this Embassy has
pushed so hard for expansion of public diplomacy programs.

-- Second, the Al-Sabah family, although almost universally
accepted as rulers by Kuwaitis, does not have a cadre of
strong leaders and the family is divided. The next
succession could come anytime and be even messier than the
2006 transfer. While we don't see any faction within the
family that would break with the strong U.S. linkage, weak
leadership could provide opportunities for increased
influence by outside extremists and extremist elements within
Kuwaiti society.

-- Third, given Kuwait's strong association with OIF, U.S.
withdrawal from an unstable Iraq would have significant
consequences and test Kuwait's ability to sustain the
strategic relationship with us. In this context, we cannot
take for granted the currently-popular notion that Kuwait
could be employed automatically as a base from which to
launch operations into Iraq as needed over an indefinite
period. As we plan for transitions in our long-term force
presence, periodic visits by the Secretary of Defense and
other senior officials will be necessary to complement the
robust engagement by CENTCOM leadership. Our Defense
Cooperation Agreement has served U.S. interests very well and
we should work to preserve it.


2. (C/NF) The dialogue about Iran that we have started with
Kuwait and others in the Gulf is critical to our future
ability to act to stem Iran's regional and international
ambitions. The GCC plus Two mechanism and the Gulf Security
Dialogue, as well as exchanges in intelligence channels,
should continue on a regular basis. Although it considers
Iranian bullying its greatest external threat, Kuwait's
leadership has indicated publicly that bases in Kuwait may
not be used for military actions against Iran, and there is a
great interest in seeing actions against Iran remain in the
context of UNSC Chapter Seven resolutions. In my farewell
call with the Amir, he urged continued U.S. engagement with
Iran in order to address security issues in Iraq.

Countering Terrorism and Extremism
--------------


3. (C/NF) The capable terrorists in the region have not
acted against Kuwait, even though the Kuwaiti leadership is
seen as the principal ally of the U.S. in the Gulf and, after
the Al-Saud, Al-Qaeda holds the Al-Sabah family in the
greatest contempt. We have no reason to believe Kuwait's

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luck will hold indefinitely. Our C/T coordination with
Kuwait is characterized by willingness to exchange
information and act against external targets but inconsistent
efforts to effectively sanction Kuwaiti terror facilitators.
The Al-Sabah family is not a target of Kuwaiti terror
facilitators and financiers, who focus their efforts on
supporting jihad in Afghanistan and Iraq. So far we have not
seen an outflow of terrorists from Iraq to Kuwait, but much
of our planning with Kuwait assumes this will occur at some
point. In the last few months, the Kuwaitis have welcomed
USG assitance with assessing and improving protection of
their oil infrastructure.


4. (C/NF) Kuwaiti financial institutions have strong money
laundering and terror finance controls, and Kuwait has been a
big player in the MENA-FATF. The banks are aware that their
ability to operate internationally could be severely damaged
by leakage. Our dialogue about support for extremism abroad
by Kuwaiti-based Islamic charities has been only partially
productive. Knowledge of the existence of the dialogue has
made the charities more careful, but the GOK has not, for
internal political reasons, significantly enhanced its
monitoring of these bodies. In our approach, we risk the
perception that we are objecting to these charities's
activities because they are Islamic, and we will need to make
sure our evidence of wrongdoing is convincing and that
countries where Kuwaiti religious charities are involved in
improper activities take actions of their own. Moreover we
suspect that most funding for foreign fighters is flowing as
simple movements of cash across borders, requiring preventive
actions based largely on intelligence gathering and sharing.

Economic Relations
--------------


5. (C/NF) There is zero chance over the next year that Kuwait
will make the economic reforms necessary in order to reach a
Free Trade Agreement with the U.S., regardless of the status
of USTR's negotiating authority. Kuwait's economy is growing
at well over five percent annually, with no compelling
impetus for reforms. The benefits from any eventual free
trade agreement will come in the form of structural changes
in the Kuwaiti economy, but not result in significantly
higher trade flows. While continuing to advocate strongly
for U.S. commercial interests, as a government we should
focus much more on the investment part of the picture than on
free trade. Recent modest USG efforts to encourage
investment flows from the Gulf do not nearly match the
negative impacts of pending NOPEC legislation and the general
perception since the Dubai Ports debacle that the U.S.
doesn't welcome Middle Eastern investment. These sorts of
positive discouragements of external investment only add to
the current Kuwaiti interest in seeking investment
opportunities in India and China. We should also not
underestimate the negative impact on our economic relations
of the fear felt by business people of seemingly arbitrary
treatment by officials at U.S. ports of entry.

The Freedom Agenda
--------------


6. (C/NF) Although many Kuwaitis are currently fretting
about the less than inspiring performance of their
parliament, the trends toward wide political participation
are strong, and the objectives of our Freedom Agenda for
Kuwait have largely been met -- voting rights for women,
reduction of the number of electoral districts, support for
press freedom. The Al-Sabah family's internal problem
continues to be how much power to cede while still
maintaining itself in power. Most Kuwaitis want to preserve
a significant role for the Al-Sabah. There is no credible
call for fundamental change to the constitutional
apportionment of power. The fact that there is a written
constitution, that actually means something when it comes to
how the country is ruled, and that it is a popular document
is unique for this region and frankly astonishing.


7. (C/NF) Our approach to helping the Kuwaitis with
democracy-building -- through MEPI, exchanges, and engagement
on the ground -- has been guided by partnering with local
organizations and quiet sustained dialogue with a wide range
of political groups. While there is an occasional bleat from
extremists about interference in domestic affairs, our role
as an interested friend is widely accepted and welcomed. As
in other predominately Muslim states, we need to continue to
refine our thinking about how to deal most effectively with
Islamist parties and organizations. In Kuwait, the Muslim

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Brothers and even many Salafis have, at least for now, bought
into the democratic system and are active participants in it.

Public Diplomacy
--------------


8. (SBU) We have seen a significant increase in our outreach
and exchange programs in recent years through the ACCESS,
YES, and a wide variety of new MEPI and International
Exchange programs. These programs not only influence
attitudes about the United States, they are life-changing
experiences for participants. However, compared with the
resources available for military and counter-terrorism
programs, the resources for public diplomacy and personnel to
manage them remain ridiculously small. As noted earlier in
this report, people-to-people exchanges have a significant
impact on our long-term security interests -- public
diplomacy needs to be supported in this strategic context.


9. (SBU) Through a mission-wide effort we have turned around
the post-9/11 drop in Kuwaitis studying in U.S. colleges and
universities, but it has been slow going with lots of
competition. The priority treatment and outreach to students
by our consular personnel has been critical -- and recognized
and appreciated by the Kuwaiti public and leadership. We
also have an effective partnership with AMIDEAST for
counseling and testing services. In coming years, we need to
focus on stronger promotion of short-term specialized
undergraduate and graduate studies in the U.S. We also need
to encourage a much bigger flow of students and professionals
from the United States to participate in exchange and
cultural programs in Kuwait.

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For more reporting from Embassy Kuwait, visit:
http://www.state.sgov.gov/p/nea/kuwait/?cable s

Visit Kuwait's Classified Website:
http://www.state.sgov.gov/p/nea/kuwait/
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LeBaron