EAC CONVENED TO DISCUSS POSSIBLE SUSPENSION OF AGOA

C O N F I D E N T I A L ANTANANARIVO 000840

DEPT FOR DS, D, P, M, S/CT, CA, AND INR
DEPT FOR DS/AF/IP
DEPT FOR DS/ITA/AF
DEPT FOR AF/E

SIPDIS

E.O. 12958: DECL: 12/08/2032
TAGS: ASEC CASC MP PGOV PREL PTER MA
SUBJECT: EAC CONVENED TO DISCUSS POSSIBLE SUSPENSION OF AGOA

REF: ANTANANARIVO 00810

Classified By: RSO BENT FOR REASONS 1.4 B AND D


1. (C) An Emergency Action Committee (EAC),chaired by the
ambassador and DCM, was convened on December 8 to assess
potential security consequences if Madagascar's AGOA
eligibility is terminated later this month. There was a
general consensus amongst the EAC members that although there
might eventually be protests associated with the loss of
AGOA, they would not necessarily target U.S. interests or
happen instantaneously. More likely suspension will
contibute to general dissatisfaction with the HAT government
and President Rajoelina (TGV),and actions might not be
evident until after the holidays and when the concrete
economic effects of the loss are felt in January or February.


2. (C) Ambassador Marquardt opened the meeting with an update
of ongoing discussions in Maputo, where progress at forming
an inclusive transition government has been limited despite
the talks having been extended from the planned one day
meeting to five days. If this last opportunity to form a
consensus government does not succeed, it is likely that
Madagascar will indeed lose its AGOA privileges and with them
some 50,000 jobs that support possibly 500,000 people.


3. (C) Should AGOA be lost, it is expected that there will be
a barrage of negative press against the ambassador and/or the
Mission/Embassy/USG. But the Public Affairs Officer noted
that despite the slanted and uneven Malagasy press, most
citizens will understand the reality of the situation - that
the loss will have occured as a result of the shortcomings of
the HAT and failure of the Malagasy political elite to take
responsibility. It is believed that the Malagasy people are
severely disappointed with HAT President Rajoelina, who came
to power via a coup promising a better life for the poor and
progress for Madagascar. Although many Malagasy viewed the
former President Ravalomanana (R8) as corrupt and imperfect,
the abuses of power by and under the HAT since his departure
are seen as far more extensive. The HAT governnment's tenure
has decreased donor aid, stalled tourism and investment, and
now could increase unemployment dramatically. Overall, there
is an overwhelming feeling of despair amongst the Malagasy as
prospects for economical security decline.


4. (C) Although some limited AGOA-related protests may be
anticipated, the general EAC consensus was that they will be
against High Transition Authority (HAT) President Rajoelina
and his government, rather than against U.S. interests. As no
announcement will be made until late December, it is likely
that the news will be overshadowed by the holidays and that
protests will not be organized until January. Additionally,
EAC believes that no protests will commence until the
economic results of the loss of AGOA are felt concretely in
the form of actual layoffs. The Econ Officer noted that
possibly 40-50 percent of AGOA jobs (approximately 20,000)
would be cut by the end of January and the remainder in
February. The officer also noted that longer-term worker
dissatisfaction over job losses could be mitigated initially
by the immediate benefits of severance packages. There was
also consensus that the workers themselves would not be the
force behind any protests, which more likely would be
orchestrated and paid for by opposing political parties
against the HAT. A few members mentioned that once the heat
would be turned on TGV, he would in turn attempt to scapegoat
the U.S.


5. (C) Another worrisome outcome of the AGOA pullback with
be the effect on the already burgeoning crime rate in
Madagascar (REFTEL). As noted over the last two years, the
frequency and level of crime has increased significantly,
especially in the run-up to the holidays. As the financial
effects of loss of AGOA are felt, we anticipate a further
deterioration. The mission LES staff have expressed their
fears of being targeted as they occupy a fairly comfortable
middle class status. Folowing the last EAC, adequate
measures are already in place to respond to rising crime.


6. (C) The EAC agreed that if indeed AGOA is cut, the formal
announcement should be generated in DC and not locally by the
Embassy. A proposal was put forward to push for more
statements in a multilateral context rather than unilaterally
by the U.S. mission or the ambassador. We should push for
the UN and other missions to emphasize that AGOA suspension
is just a part of an overall pattern of negative donor
responses to the continuing political impasse in Madagascar,
with further sanctions and consequences if the impasse
continues. Noting the power of word of mouth, chat rooms and
other informal methods of communication in Madagascar, the
Mission will distribute a one-page "fact sheet" in English,
French and Malagasy with talking points regarding continuing
U.S. engagement in and contributions to Madagascar's
development. This will be shared with all employees and
dependents, as well as outside the mission. The ambassador
stressed that the U.S. Government is still engaged in
significant assistance to Madagascar, through programs like
the Peace Corps and USAID, and asked the Mission community to
continue to promote understanding of those efforts.
Additionally, we will continue and accelerate high-profile PD
efforts to call media and public attention to such programs.


7. (C) The EAC recommended that if workers do seek to
protest, they should be allowed to do so at a location that
does not compromise mission security. RSO will work with
local security forces to establish parameters for such
protests while protecting the Chancery and mission staff.
Similar plans will also be developed for the USAID Offices,
which are co-located with the European Union in the Zital
Building. EU sanctions are the likely next shoe to fall
(after the New Year) and so protests at that location are
also a possibility. RSO will also review and update
provisions for the ambassador's personal and residential
security.


MARQUARDT