GUINEAN PRESIDENT CANCELS LIBYAN HOTEL CONTRACTS

C O N F I D E N T I A L CONAKRY 000078

SIPDIS

SIPDIS

E.O. 12958: DECL: 04/08/2018
TAGS: PGOV PREL ASEC LY GV
SUBJECT: GUINEAN PRESIDENT CANCELS LIBYAN HOTEL CONTRACTS


Classified By: POL/ECON CHIEF SHANNON CAZEAU FOR REASON 1.4 B AND D


1. (U) Late on Friday, April 4, Radio Television Guinean
(RTG) reported that President Lansana Conte had signed a
decree cancelling Guinea's recent hotel deals with Libya.
Prime Minister Lansana Kouyate is responsible for negotiating
the deals, which essentially turned over three major Conakry
hotels to Libyan companies, and also provided land for Libya
to construct a five-star hotel near the U.S. Embassy.


2. (C) Kouyate's frequent trips to Libya and his apparently
close relationship with Kaddafi have fueled widespread
speculation and suspicion among the population. In recent
months, several Embassy contacts from all sectors of society
(including the government, civil society, and political
parties) have questioned Kouyate's motives. They have also
questioned whether the deals were made in order to provide
some personal, private benefit to the PM. Even the unions,
which have traditionally been Kouyate's staunchest
supporters, repeatedly expressed concern about the deal after
it was signed late last year.


3. (U) The president's decree canceling the Libyan contracts
seems to be perceived as a direct strike against the PM. The
press has speculated that certain members of the president's
entourage, especially controversial millionaire Mamadou
Syllah, may have been behind the president's decision.
Syllah's name has come up because his company, Futurlec, used
to operate one of the hotels in question (Kaloum Hotel),
which is the only one of the three that is not actually
operating today. (NOTE. The other two hotels are the Hotel
Camayenne and the Novotel. END NOTE).


4. (C) Union leader Dr. Ibrahima Fofana told Pol LES on
April 7 that the presidential decree essentially sends a
message that Guinea does not welcome foreign investment.
Poloff raised the issue with another union leader, Louis
M'Bemba Soumah, on April 7 at a public event they were both
attending. Soumah said that the decree undermines the PM's
powers. When Poloff pointed out that the unions themselves
have been questioning the deal and how it was negotiated,
Soumah said "yes, that is true, but it is the principle of
the matter that we object to." According to Soumah, under
the power sharing agreement, the president should not be able
to cancel the PM's decision. "That is why we (the unions)
went directly to see Kouyate after we heard about the
decree," Soumah added. Union leader Mme Serah Rabiatou
Diallo told Pol LES that she had not been able to join her
union colleagues on the visit because she was not feeling
well.

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COMMENT
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5. (C) Whether orchestrated by his entourage or the
president himself, the move to cancel the Libyan hotel
contracts is likely another play in the power struggle
between the PM and the presidency. The unions seem to have
coalesced in support of the PM, at least publicly, despite
private concerns about the deal on the part of individual
members. Rabiatou's absence, however, is telling. During
several different meetings with Poloff, Rabiatou criticized
the hotel deal and implied that the PM was doing it for
personal gain. It is unlikely that she supports the position
of fellow union leaders. To date, Embassy has not seen any
reaction from the PM's office to the Friday decree. END
COMMENT.
CARTER