UNDER SECRETARIES BURNS AND FLOURNOY MEET WITH DPM

C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 001321

SIPDIS

E.O. 12958: DECL: 05/14/2029
TAGS: PREL PGOV MARR IZ
SUBJECT: UNDER SECRETARIES BURNS AND FLOURNOY MEET WITH DPM
ISSAWI

Classified By: Deputy Chief of Mission Patricial A. Butenis for reasons
1.4 (b) and (d).


1. (C) Summary: In a May 13 meeting with Under Secretary of
State Bill Burns and Under Secretary of Defense Michele
Flournoy, Iraqi Deputy Prime Minister Rafi al-Issawi blamed
the politicization of government ministries and corruption
for the poor state of essential services in Iraq. He said
health care was his highest priority, as the sector had
suffered from 25-30 years of neglect, and expressed hope that
Iraq would move toward a "liberal-secular" model of
government in the next election. Issawi said Kurd-Arab
tensions would likely continue as Iraq moves toward Kurdish
and national elections, and criticized the UN's reports on
Disputed Internal Boundaries (DIBs) as ill-timed, and for
including non-disputed areas in the reports. End Summary.

Services and Capacity-Building
--------------


2. (C) Under Secretary of State for Political Affairs Bill
Burns and Under Secretary of Defense for Policy Michele
Flournoy, accompanied by Charge d'Affaires Patricia Butenis,
met May 13 with Deputy Prime Minister Rafi al-Issawi.
Flournoy began by expressing support for a strong and unified
Iraq. She asked Issawi about the state of basic services and
what the U.S. could do to help.


3. (C) Issawi replied that politics, security, and services
are mixed together. Regarding services, the challenge in
2009 is capacity building. This has been difficult as the
GOI's budget has been affected by the collapse of the price
of oil. There is also a problem of control and lack of
technical competence. As Iraq moves from a highly
centralized state to a more federal model, leaders are
finding a lack of expertise at the provincial level.


3. (C) Issawi noted that he had met with a group of
provincial governors and that they are trying to identify
technical experts to help improve services. He said he has
had good collaboration from the Embassy and USAID to build
institutional capacity, but that government institutions are
too politicized. Service delivery, he said, cannot be based
on religious affiliation. Institutions need to be developed
on a national basis, rather than along ethnic or sectarian
lines. Improvements of institutional capacity to streamline
provision of services face the obstacle of politicians who
maintain power through patronage networks that currently
determine resource allocation, often along sectarian or party
lines.


4. (C) In response to a question from U/S Burns, Issawi said
health care is his highest priority. He noted that for three
years, the Ministry of Health had been "infiltrated" by
militias and that the system of health care had been damaged
over 25-30 years of neglect. Therefore, it will take time to
repair. Issawi said that his second priority is agriculture,
and that his third priority is electricity. However, Issawi
emphasized that it was difficult to prioritize essential
services as they were all important.

Corruption
--------------


5. (C) Issawi stressed that corruption is one of Iraq's
biggest challenges and is adversely affecting services such
as water supply, education, health care, and agriculture. In
response to a question from U/S Burns regarding how
anti-corruption efforts can be strengthened, Issawi said that
anti-corruption institutions have not been free to act
because of political interference. He commended Parliament's
actions during the past few days to call ministers for
questioning, but noted that some party blocs are working
Qquestioning, but noted that some party blocs are working
behind the scenes to prevent affiliated ministers from
attending Parliament.


6. (C) The DPM noted that the Oil Ministry is especially
badly administered, and that this is widely recognized. Why
then, he asked rhetorically, has the minister not been
replaced? This situation, he said, in which ministerial
positions are allocated and protected based on sectarian,
ethnic or party affiliation rather than competence, will have
to change after the next election.

Partisanship and Secular Politics
--------------


7. (C) Issawi stressed that Iraq's political leaders are now
more focused on building parties than institutions, and noted
that "most groups" in government are religious parties. He
expressed hope that this would change after the next election

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and that Iraq can move toward a "liberal-secular" model that
is preferred by "most Iraqis." In that vein, Issawi noted
that former Prime Minister Ayad Allawi provided a good
secular model for leadership, and that Allawi had selected
better and more experienced people than the current
government.


8. (C) DPM Issawi said it was important that liberal-secular
parties join together to avoid being marginalized in
elections. In the provincial elections, he noted that some
liberal parties ran separately and split votes, winning no
seats as a result. If they had joined together they would
have done much better.

Reconciliation and SOI Integration
--------------


9. (C) Concerning reconciliation efforts, Issawi said that
there has been more rhetoric than progress. Only a small
number of Sons of Iraq (SOI),noted Issawi, have genuinely
been integrated in the security services. He said there
needs to be a permanent solution rather than dealing with the
SOI through temporary contracts. Issawi also said that there
is still mistrust of the SOI initiative, and that many view
the SOI as a creation of the U.S. military. He said this
situation was symptomatic of promises that have not been
implemented. Issawi added that for "political reasons," the
Ministry of Migration has overstated the number of internally
displaced people in Iraq.

U.S. Military Transition
--------------


10. (C) U/S Flournoy asked Issawi for his views regarding the
upcoming transition of U.S. forces out of cities, and whether
Iraqi security forces were prepared. Issawi said that both
the Ministries of Defense and Interior were well positioned
to take over and were performing well. However, while both
ministers are well regarded, Issawi acknowledged that there
has been an increase in bombings.

Arab-Kurd Tensions
--------------


11. (C) Concerning Kurd-Arab tensions, and the release of the
UN's report on Disputed Internal Boundaries, Issawi agreed
that there has been an increase in tension and that this will
likely continue as Iraq gets closer to Kurdish and national
elections. He said the UN reports were not well received,
and that the timing of the reports' release was bad. Issawi
said he had formed a study group consisting of MPs from
Mosul, Kirkuk and Diyala. However, he criticized the UN for
including in its reports "some non-disputed areas." All
groups, he concluded, are dissatisfied by the reports.


12. (U) U/S Burns and USD/P Flournoy have cleared on this
message.
HILL