A/S HILL'S MEETINGS WITH MONGOLIAN OFFICIALS

C O N F I D E N T I A L ULAANBAATAR 000349

SIPDIS

SIPDIS

STATE FOR EAP/FO, EAP/CM, AND EAP/K
NSC FOR D. WILDER
AID FOR ANE FOR D. WINSTON

E.O. 12958: DECL: 06/16/2017
TAGS: PREL MARR EAID SCUL MG IZ KN
SUBJECT: A/S HILL'S MEETINGS WITH MONGOLIAN OFFICIALS

Classified By: Ambassador Mark C. Minton, for reasons 1.4 (B) and (D)


1. (C) SUMMARY: EAP Assistant Secretary Christopher Hill
met on June 15 with Mongolia's President, Prime Minister and
Foreign Minister. None of the officials revealed their
thinking on the pending decision on whether to send an 8th
rotation of troops to Iraq, but President Enkhbayar noted
that such deployments had begun when he was Prime Minister,
and that he saw them as a form of repayment for the
assistance other countries had given Mongolia during the
difficult years in the early 1990's. The officials viewed
President Enkhbayar's proposed trip to the U.S. in October as
a chance to deepen the bilateral relationship and welcomed
the likelihood that a Millennium Challenge Account compact
will be ready for signing then; the compact is not just a
matter of money, they said, it will symbolize the growth in
bilateral relations. The Foreign Minister urged the U.S. to
consider Mongolia's proposed "Comprehensive Partnership
Framework Agreement," but said that Mongolia is ready to
change the format and the contents. The Prime Minister and
Foreign Minister expressed concern about declines in U.S.
foreign assistance to Mongolia, which sent the wrong signal
to Mongolia's public. The officials expressed hoped that
North Korea would implement its obligations in the Six Party
Talks -- and offered Mongolia as a possible alternative venue
for bilateral or multilateral discussions with the DPRK. END
SUMMARY.


2. (SBU) A/S Hill arrived on June 15 to begin a three-day
visit to Mongolia. After a lunch with Foreign Minister N.
Enkhbold, A/S Hill went to the Ministry of Defense to meet
with 15 Mongolian soldiers who had served on peacekeeping
missions in Iraq, Afghanistan, Sierra Leone or Kosovo. He
then met with Prime Minister M. Enkhbold and President N.
Enkhbayar. During his meetings, A/S Hill was accompanied by
Ambassador, EAP Special Assistant Tom Gibbons, and E/P Chief.
Later during his visit, A/S Hill participated in the Asia
Society's Williamsburg Conference, visited Peace Corps
Volunteers and Trainees in the field, visited a USAID
project, had several media events, and met with the Embassy's
staff and family members.

Iraq
--------------


3. (SBU) A/S Hill told both the Prime Minister that earlier
in the afternoon he had been very pleased to meet with
returned Mongolian peacekeeping troops, including ones who
had served in Iraq. A/S Hill said he had thanked them for
their service, and stated that they had impressed those who
interacted with them because of their professionalism. While
the PM made no response in his own remarks, President
Enkhbayar cited the expanded range of bilateral cooperation,
including peacekeeping in places like Iraq and Kosovo.
Enkhbayar recalled that, when Russia abruptly cut off its aid
to Mongolia in the early 1990s, Western countries -- the
U.S., Japan, the European Union -- stepped in to assist
Mongolia. He said that, when he had been Prime Minister and
Mongolia first sent troops to Iraq, he had made the point
that it was time Mongolia began to repay its "debt" to the
world. Saying he appreciated A/S Hill's praise for
Mongolia's soldiers, Enkhbayar commented that he could see
the difference among Mongolian soldiers who had served in
Iraq -- they were more mature, professional, and even more
physically fit. Mongolia's contribution of troops to
peacekeeping in Sierra Leone, Kosovo, Afghanistan and Iraq
had led to it being more involved in global affairs.
Enkhbayar added that it had also provided a good path for the
reform of Mongolia's military, and U.S. assistance had led to
more professional Mongolian soldiers and military. He said
he looked forward to taking part as Commander in Chief in the
opening ceremony of the U.S.-supported Khaan Quest
peacekeeping training exercise in August, and said he was
pleased that South Korea would send troops to exercise.

U.S. Visit by President Enkhbayar
--------------


4. (SBU) A/S Hill told his interlocutors that, while a
definite date had not yet been set for President Enkhbayar's
visit, it likely would be in the latter part of October.
President Enkhbayar commented that he had been grateful to be
invited to the U.S. by President Bush. He opined that this
would be a good chance for the two presidents to review
issues, and the visit would be a very important step to
strengthen bilateral cooperation. A/S Hill's visit provided
a good opportunity to prepare for the visit, and to help form
a clear vision for developing bilateral cooperation.

Millennium Challenge Account (MCA) Compact
--------------


5. (SBU) A/S Hill told interlocutors that it definitely
appears that an MCA compact will be ready to be concluded
during the visit. He expressed pleasure that Mongolia would
be the first country in East Asia to conclude an MCA compact.
A/S Hill said he knew that getting to the compact had been
very frustrating, and recalled that, during the November 2005
POTUS visit to Mongolia, the President had said that he had
made changes to speed up MCC's work. His interlocutors
expressed pleasure at the prospect of a compact signing, but
noted the length of time it had been pending. The Prime
Minister commented that the compact would be very important
for Mongolia's economy, and would help Mongolia solve both
economic and social problems. The Foreign Minister opined
that, after years of being eligible for MCC assistance, the
amount is no longer the important thing ) the importance is
to get it done and signed, which will be a good political
symbol.

Third Neighbor Policy and Relations With the U.S.
-------------- --------------


6. (SBU) A/S Hill said that it is to Mongolia,s credit that
it maintains good relations with such a range of countries )
even North Korea, which he knew from his own experience is a
full-time job. The President stated that, as a small
country, Mongolia could not afford problems with other
countries. Mongolia's Foreign Policy Concept called for a
"multi-pillared" approach -- which, he smiled, had not
pleased Mongolia's neighbors, which preferred either a
two-pillar approach or even a one-pillar approach. However,
relying on many pillars is best for Mongolia. The Foreign
Minister commented that Mongolia,s history is one of a
balancing act between big players. Luckily, so far it had
managed to do a good job. Under its &third neighbor8
policy, FM Enkhbold said, Mongolia tries to maintain good
relations with all countries. The third neighbor policy does
not mean relations with any one country, but a whole group of
countries that support Mongolia. The U.S., South Korea,
Japan, and India are given priority, due to their support
from the beginning of Mongolia,s transformation. The U.S.
is a very important partner for Mongolia, politically and
economically, the Foreign Minister said. All three
interlocutors emphasized that the November 2005 POTUS visit
had given a boost and added momentum to bilateral relations,
and said that they are very satisfied with the excellent
state of bilateral relations.

Comprehensive Partnership Framework Agreement (CPFA)
-------------- --------------


7. (SBU) The Foreign Minister noted that, during President
Bush's visit, the two presidents had made a commitment to
define guiding principles for the relationship, and put these
in a written document. MFA had proposed the CPFA, which
would be a milestone in bilateral relations, and would show
the rest of the world the very good relations between the two
countries. However, he continued, this could be a
declaration or statement in any form, if it can be signed
during President Enkhbayar's forthcoming visit. A/S Hill
responded that he had talked to Ambassador Bold about the
CPFA and understood Mongolia's desire for an agreement. The
substance of Mongolia's proposal is not a problem, but the
format is important, and it would be problematic to choose a
format which would involve Congress. The U.S. is ready to
work closely with Mongolia to make a presidential joint
statement an historical document which would clearly indicate
relations had reached a milestone. Something like the
elements from the proposed CPFA could be incorporated in a
joint statement, which would serve for years to come as a
guiding document for relations. FM Enkbhold responded that
MFA is ready to consider amendments to its draft. After a
side conversation with Jambaldorj later in the lunch, FM
Enkhbold returned to the CPFA by commenting that several
joint statements between the U.S. and Mongolia had already
been issued. Perhaps the joint statement this time could be
signed, he wondered, to illustrate its difference. A/S Hill
responded that the U.S. would work with Mongolia to try to
boost the profile for a joint statement, but noted that the
statements are typically not signed. Prime Minister Enkhbold
commented that the draft CPFA had been given to the State
Department by MFA, and said that MFA is ready to discuss this
document, which would be very important for bilateral
cooperation. The CPFA was not mentioned by President
Enkhbayar.

Request for Visa Waiver Program Consideration
--------------


8. (SBU) Foreign Minister Enkhbold asked that the U.S.
consider including Mongolia in the Visa Waiver Program. He
noted that Mongolia gives visa free entry to U.S. citizens
for 90 days. Mongolia's population of 2.6 million is small,
he said, and Mongolians love their homeland. Most would come
back from the United States. A/S Hill asked what the visa
refusal rate is for Mongolians. DCM stated that it is 49.8%,
and commented that Mongolians love their country, but many do
it from a distance. The Foreign Minister laughed and added
that this wasn't just true of the U.S. -- there are
Mongolians in South Korea and Japan, too. Turning serious
again, he said that this was an official request, and
Mongolia hoped the U.S. would consider it.

Concern Over Declining U.S. Foreign Assistance
-------------- -


9. (SBU) Foreign Minister Enkhbold expressed concern about
declines in funding for USAID activities, from $7.5 million
in FY 2005 to $5.6 million in the current year. Despite the
explanations which might be offered for this, it would easily
be seen by the public as a sign of declining U.S. support.
Prime Minister Enkhbold expressed concern that, based on
Mongolia's recent strong economic growth, some donor
countries might reduce aid. Although Mongolia had had good
economic success recently, there remain big problems in both
urban and rural areas. Assistance from USAID has helped
Mongolia develop. News of U.S. aid reductions caused concern
and, the Prime Minister said, he hoped this would not happen.
A/S Hill responded that these statements were timely, since
he would discuss foreign assistance levels for EAP with the
Secretary at the end of June. He stated he would try to make

SIPDIS
sure Mongolia gets a proper level of assistance.

Desire for More U.S. Scholarships
--------------


10. (SBU) Foreign Minister Enkhbold noted that, during the
November 2005 POTUS visit, the two presidents had discussed
educational cooperation. Mongolia needs to provide good
education to its youth, and hopes for more scholarship from
the U.S. Frankly, he said, if one compares the number of
scholarships offered by the U.S. government with those given
by other developed countries, such as Australia, the U.S.
gives next to nothing, while public expectations are great of
the U.S. A/S Hill responded that he recalled the
conversation during the POTUS visit. While the U.S. had
followed through on commitments made during the visit, he
agreed that the absolute numbers remain small. Ambassador
noted that there are many more opportunities to increase
scholarships from other than the U.S. government, and noted
ongoing efforts to encourage U.S. universities to increase
scholarships. For instance, Mongolian alumni of U.S.
universities could lobby their alma mater. A/S Hill agreed
that such efforts likely had the most promise, but he said he
would look to see if the USG could do more.

Resignation of Speaker, and Mongolia's Stable Foreign Policy
-------------- --------------


11. (SBU) The Foreign Minister noted that Ts. Nyamdorj
resigned as Speaker on Thursday because of &political
debate.8 The MPRP caucus had met and decided to endorse
Vice Speaker Lundeejantsan to replace Nyamdorj. The Foreign
Minister said had just heard that some other political
parties had positively responded to the MPRP on this idea,
and Lundeejantsan might be confirmed as Speaker on Friday
afternoon. He opined that Lundeejantsan was the most logical
and suitable replacement ) though, he said, lots of people
might like to be Speaker. With this issue over, he said, he
believed the Parliament would overcome the difficulties it
had experienced recently.


12. (SBU) The Ambassador commented that this situation is
unlikely to affect foreign policy issues. The Foreign
Minster concurred, and said that there had been uniform
agreement about foreign policy issues over the last 15 years
among Mongolian politicians, and thus a stability of foreign
policy. All Foreign Ministers had tried to keep to the same
line. He opined that he thought this was appreciated by
Mongolia,s partners ) and good for Mongolia.

North Korea, and Mongolia As a Venue for Talks
-------------- -


13. (C) Foreign Minister Enkhbold confirmed that there is an
agreement for Mongolia to host a visit in the near future by
Kim Young Nam, President of the DPRK's Supreme People's
Assembly. All three interlocutors expressed their strong
support for the Six Party Talks. A/S Hill noted to the
Foreign Minister that it was a bit frustrating the North
Koreans had issued no statement yet on the transfer of funds
to it from Banco Delta Asia. The Foreign Minister responded
that he wasn't surprised, based on Mongolia,s own experience
with the North Koreans. President Enkhbayar opined that
there should be good implementation by all sides, and North
Korea needs to show that it is a more responsible party.


14. (C) Foreign Minister Enkhbold stated that Mongolia,s
ambition is for the Six Party Talks later to develop into a
larger group of countries which will discuss security and
other issues in Northeast Asia. He noted that Mongolia had
been the first to advance this idea, in 2000. A/S Hill
responded that the U.S. is looking at the question, if the
talks progress, of launching a Northeast Asia security
mechanism ) and, he smiled, Mongolia is very much in North
Asia. The Foreign Minister commented that Mongolia is a
member of many groupings, but really looks for one which is
smaller, maybe subregional, and therefore had more of a focus
on the region around Mongolia. In his meeting with A/S Hill,
President Enkhbayar also underlined Mongolia's hope to join a
broader mechanism on security issues which might evolve out
of the Six Party Talks in the future.


15. (C) All three interlocutors proposed Mongolia as a
possible venue for North Korea-related meetings. The Foreign
Minister said that, if there is anything Mongolia can do to
assist the talks, it will try. He cited the possibility of
organizing meetings here, and added that acting as host would
also help make Mongolia more known around the world. After
the Prime Minister also stated the offer of Mongolia as a
venue for organizing talks, A/S Hill asked whether this was
an offer of Mongolia as a venue for the Six Party Talks. The
Prime Minister responded yes, if the parties agreed. A/S
Hill said that he would mention this to his North Korean
counterpart. He commented that the DPRK might look forward
to a venue other than China, which they sometimes found
"traumatic." However, A/S Hill added, the North Koreans are
suspicious of any new ideas. President Enkhbayar noted that
Mongolia had suggested itself to Japan as a venue for that
country's talks with North Korea, and said Mongolia would be
willing to host other meetings.


16. (C) A/S Hill commented to the Foreign Minister that all
kinds of North Koreans came to Mongolia -- diplomats,
workers, and refugees. The Foreign Minister responded that
Mongolia does not consider North Koreans as "refugees," but
rather as illegal entrants onto its territory; it dealt with
this as a humanitarian issue through very quiet cooperation
with other countries. A/S Hill expressed appreciation for
Mongolia's willingness to work with South Korea and the U.S.
on resettling North Koreans. President Enkhbayar commented
that some North Koreans made the arduous journey from China
into Mongolia. While most wanted to go to South Korea, if a
small number wanted to go to the U.S. instead, Mongolia would
work with the U.S. to do this. The President added that
Mongolia had to assist the North Koreans; it could not send
them back.
MINTON