C O N F I D E N T I A L SECTION 01 OF 02 WINDHOEK 000335

SIPDIS

AF/S

E.O. 12958: DECL: 10/21/2018
TAGS: KMCA PGOV ECON WA
SUBJECT: NAMIBIA: PRIME MINISTER CONVOKES CHARGE ON MCC

REF: WINDHOEK 331

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Classified By: Charge d'affaires, a.i. Matt Harrington;
reasons 1.4 (b) and (d)

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Summary
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1. (C) Prime Minister Nahas Angula convoked the Charge
d'affaires October 21 to express the Namibian Government's
(GRN) continued commitment to the Millennium Challenge
Account (MCA) program, following news reports that senior
ruling SWAPO party officials continue to have serious
concerns about it. Angula refuted press accounts that the
MCA Compact had been withdrawn from Parliament. He stressed
that the Namibian Government (GRN) was still looking to
ratify the Compact before Parliament's December-January
recess. The Prime Minister emphasized that negotiations on
the MCA Program Implementation Agreement (PIA) and a separate
tax agreement need to be approved (or near approval) before
Compact ratification. Despite the Prime Minister's
assurances, some senior members of SWAPO still have questions
about some of the details in the MCA Compact. Following the
October 16-17 meetings of the SWAPO Politburo and other
senior party officials, press outlets reported that some
SWAPO leaders, including perhaps President Hifikepunye
Pohamba, have concerns about some provisions in the MCA
compact. End Summary.

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Prime Minister Committed to MCA Compact
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2. (C) On October 21, Prime Minister Nahas Angula convoked
the Charge to his office to discuss the state of play
regarding ratification of the MCA program. The Prime
Minister was accompanied by the Deputy Permanent Secretary
for Foreign Affairs, Ambassador Hinyangerwa Asheeke, while
the Charge was joined by the MCC Country Director and
econoff. Angula noted that there had been a lot of
"publicity" on MCA in the press following his last meeting
with Charge on October 15 (reftel) and the subsequent
gathering of the SWAPO parliamentary caucus. (Note: Angula
never directly mentioned a SWAPO Politburo meeting on October

16 and 17, which the Namibian press has covered extensively -
see paragraphs 6-7. End Note). The Prime Minister added
that the GRN was trying to get the message out, and remarked
it had placed a newspaper insert - a full four pages in the
October 17 edition of the government-owned New Era -
explaining the MCA program. Angula acknowledged that some
members of the SWAPO caucus "misunderstood" (and some
continue to misunderstand) the program.


3. (C) Despite press reports to the contrary, Angula
stressed that the MCA Compact had not been withdrawn from
Parliament but, rather, that debate had been postponed so
that pending concerns could be resolved. He reiterated the
GRN's commitment to ratify the Compact before Parliament
adjourns at the end of November. The Prime Minister
emphasized that negotiation on the PIA and tax agreement --
the two now controversial implementing documents for the MCA
program -- need to be "fast tracked" and essentially approved
before ratification can occur. Angula also confirmed press
reports that a group of party insiders, led by Dr. Albert
Kawana, the Minister of Presidential Affairs and Acting
Attorney General, would provide "political oversight" of the
Namibian contingent in the negotiations over the PIA and the
tax agreement.


4. (C) Parliamentary debate on the MCA program should begin
in two to three weeks, the Prime Minister explained. He
noted that the "(Namibian) MCA team will have to make a
complete presentation to the caucus." The PM remarked that
all outstanding issues (misinformation) ) such as the issue
of concessions around Etosha National Park, exempting MCC
from taxation and legal liability, and the supremacy of the
MCA compact over Namibian law (except for the constitution) -
will have to be addressed. The MCC Director provided the
USG's explanations for each area of concern. The Prime
Minister responded that the MCC Director's explanations were
reasonable and should be transmitted to the Namibian MCA
team. 5. (C) The Charge informed the Prime Minister that
the Embassy team would "energetically pursue the PIA and tax
agreement negotiations" and he hoped the Namibian team would
do the same. The Charge and MCC Director pressed Angula on
whether the current Namibian MCA team had the requisite
authority to represent the GRN during the PIA and tax
agreement negotiations, given the objections now being raised
in some quarters about commitments previously made by the

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Namibian side. Finally, Charge expressed concern that the
GRN's failure to ratify the agreement before parliament's
December-January recess could have negative funding
implications for the MCA program.

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But Now for the Bad News . . .
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6. (SBU) According to press accounts, the SWAPO Politburo
met on October 16 and 17 and discussed the SWAPO Youth Party
League's (SPYL) recent accusations against the MCA compact
(reftel). Since September 18, SPYL and other likeminded
groups began making spurious claims that the Compact and the
draft PIA would allow the USG to purchase Namibia's "natural
treasures" and would infringe on Namibia's sovereignty. Press
stories following the Politburo meeting provided conflicting
accounts on what the SWAPO leadership decided. Some news
outlets, including the government-run New Era newspaper,
explained that the Politburo had "instructed Prime Minister
Nahas Angula to ensure that the MCA debate is withdrawn from
Parliament without causing more embarrassment for the party
and Government." The independent newspaper, The Namibian,
reported that SWAPO had decided to withdraw the MCA Compact
from Parliament altogether. The Namibian claimed that
unnamed sources had told its journalists that some ministers
felt "duped" into accepting the MCA compact.


7. (SBU) The New Era also reported that President
Hifikepunye Pohamba had "commended the SPYL for blowing the
whistle, and remarked that, had the party youth wing not
commented publicly on this issue, the country could have
entered into a bad agreement." The New Era also claimed that
Pohamba "lashed out at Minister of Works and Transport,
Helmut Angula." (Note: During Namibia's two-year-long MCA
compact negotiations, Angula was the government's lead
negotiator as Director General of the Namibian Planning
Commission (NPC). SPYL have focused many attacks on Angula,
alleging he has sympathies with a breakaway SWAPO faction
that created a new opposition party (RDP) in November 2007.
End Note).

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Comment
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8. (C) We are encouraged that the Prime Minister reached out
to us to reiterate the GRN's commitment to the MCA program.
As noted in reftel, the controversy over the MCA Compact
appears rooted in an internal SWAPO party conflict, primarily
by a faction that appears intent on discrediting Minister
Helmut Angula. Nonetheless, we believe it is possible to
finalize the PIA and tax agreements in time for Parliament to
consider the entire package before it adjourns in late
November, so long as the Prime Minister's strong commitment
is shared by the President and translated into strong
instructions to the GRN negotiating team to conclude
negotiations expeditiously. End Comment.
HARRINGTON