RUSSIAN AMBASSADOR CONFIRMS PROPOSED $2.5 BILLION

C O N F I D E N T I A L BISHKEK 000085 SIPDIS DEPT FOR SCA/CEN E.O. 12958: DECL: 01/29/2019 TAGS: PGOV PREL PINR ECON KG SUBJECT: RUSSIAN AMBASSADOR CONFIRMS PROPOSED $2.5 BILLION ECONOMIC PACKAGE FOR KYRGYZSTAN REF: BISHKEK 47 Classified By: Ambassador Tatiana C. Gfoeller, Reasons 1.4 (b) and (d). ¶1. (C) Summary: Russian Ambassador to Kyrgyzstan Vlasov confirmed to Ambassador the details of a $2.5 billion Russian economic assistance package for Kyrgyzstan and indicated that the agreement would be signed during President Bakiyev's February 3 visit to Moscow, which he also confirmed. Vlasov appeared delighted about the pending agreement, but remarked, "I'd prefer we weren't buying friends." End Summary. ¶2. (C) Ambassador spoke with Russian Ambassador to Kyrgyzstan Valentin Vlasov at a January 29 diplomatic corps working luncheon, hosted by the Belarusian Ambassador. Breaking with protocol and precedence, the Belarusian seated the Ambassador and Vlasov opposite each other, at the far end of the table, where they would be able to speak in a more private manner. The sometimes temperamental Vlasov was in an unusually jovial and expansive mood. ¶3. (C) The Ambassador asked Vlasov about press reports concerning President Bakiyev's upcoming trip to Moscow and a Russian economic assistance package for Kyrgyzstan. Vlasov confirmed that Bakiyev would be traveling to Moscow on February 3, and he said that "important decisions" would be made during the visit. Vlasov detailed the agreement for Russia to provide approximately $2.5 billion to Kyrgyzstan. He said agreement called for $150 million as a grant, $300 million in the form of a low-interest loan, and a $1.7 billion loan to fund a Russian-Kyrgyz joint venture to build the Kambarata 1 dam and hydroelectric project. (Note: Vlasov's description of the assistance package tracks with what Presidential Chief of Staff Usenov told the Ambassador January 14. Reftel. The outline of all three components of the package has since appeared in press reports. End Note.) ¶4. (C) The Ambassador commented on the enormous size of the package and its potential impact in Kyrgyzstan. She then asked Vlasov what he thought about the package. Vlasov, who had appeared almost to be gloating when describing the details, thought for a minute and said, "I'd prefer we weren't buying friends. This would be better if done between poor people." As the Ambassador pressed Vlasov to explain, the Belarusian Ambassador butted in to break up the discussion, expounding on the health benefits of his native cuisine. ¶5. (C) During the business portion of the meeting, Vlasov acted as if he owned the room. He jumped in and fielded questions directed to the MFA Protocol Chief, and both the MFA rep and the Belarusian host deferred to him. At one point, Vlasov dismissed the German Ambassador's concerns about the Kyrgyz practice of x-raying diplomatic bags by saying that the Vienna Convention didn't take into account today's concerns over terrorism. GFOELLER