TRILATERAL SUMMIT -- AFGHANS PREFER POLITICAL COMMITMENT ON

UNCLAS KABUL 001122 DEPT FOR SRAP, SCA/FO, SCA/RA, AND SCA/A DEPT PASS AID/ANE DEPT PASS USTR FOR GERBER AND KLEIN DEPT PASS OPIC FOR ZAHNISER DEPT PASS TDA FOR STEIN AND GREENIP USOECD FOR ENERGY ATTACHE CENTCOM FOR CSTC-A NSC FOR JWOOD TREASURY FOR MHIRSON, ABAUKOL, AWELLER, AND MNUGENT COMMERCE FOR HAMROCK AND FONOVICH SENSITIVE SIPDIS E.O. 12958 N/A TAGS: ECON EFIN EAID ETRD AF PK SUBJECT: TRILATERAL SUMMIT -- AFGHANS PREFER POLITICAL COMMITMENT ON TRANSIT TRADE TO DETAILED MOU AFGHANISTAN'S ISSUES WITH TRILAT MOU DELIVERABLE ¶1. (SBU) Econ Counselor and Deputy met with Minister of Commerce and Industries Shahrani May 3 to discuss a variety of trade issues leading up to the May 13-14 Regional Economic Cooperation Conference on Afghanistan (RECCA)in Islamabad. Shahrani also noted his intention to attend the May 6-7 Trilateral Summit in Washington, and raised the issue of the proposed MOU on transit trade with Pakistan. Shahrani said that at a special cabinet meeting May 3 Foreign Minister Spanta stated that President Karzai will not sign the MOU the U.S. has proposed. Instead, Afghanistan prefers that the GIRoA and GOP issue a political commitment to accelerated cooperation on all fronts, including a timetable for beginning - and concluding - negotiations on the Afghanistan-Pakistan Transit Trade Agreement (APTA). AFGHANISTAN SUGGESTS "DECLARATION" OR ABBREVIATED MOU ¶2. (SBU) Shahrani said that Afghanistan is anxious to start APTA negotiations and has already identified a team of about 16 officials to engage the Pakistani side. He said the proposed MOU "lifts language from the APTA" text proposed by the GIRoA and goes too far toward trying to negotiate the APTA at the trilateral meeting. He said the GIRoA also objects to the interim character of the U.S.-proposed MOU. Shahrani said that the Afghan preference is for an unsigned political declaration by the leaders on starting and finishing APTA negotiations. If the U.S. insists on a signed MOU, it should be restricted to this political commitment. He provided us a copy of his markup, and we have emailed this to SRAP and SCA/A staff. Shahrani said that if the U.S. insists on a detailed MOU, it should cover the whole agenda of the Trilateral Summit rather than focus only on transit trade. He said the GOP has not seen the GIRoA's alternative MOU text, and he does not know where the GOP stands on this issue. AFGHANISTAN "WELL PREPARED" FOR NEGOTIATIONS ON APTA ¶3. (SBU) Econ Counselor told Shahrani that the United States prefers the MOU as written, with the detail on specific transit trade issues retained. He also stressed the need for a prompt start of negotiations in order to meet the July 1 deadline suggested. Shahrani said the GIRoA is willing to begin soon and pointed to his draft text that gives May 10 as the kickoff date for APTA negotiations, with conclusion by June 30. Shahrani said the Afghan side is "well prepared" for the talks. ¶4. (SBU) Deputy Econ Counselor asked if the Afghan side has seen Pakistani comments on the APTA text submitted to Islamabad last year. Shahrani replied that the Pakistani side has "accepted the draft in principle," but he realizes that there are issues that will need to be addressed. (NOTE: World Bank reps told Deputy Econ Counselor May 3 that the Pakistanis have made substantial markups to the APTA draft, but will not provide these to the Afghans until the RECCA. End Note) COMMENT ¶5. (SBU) From Shahrani's comments, it appears the Afghans are wary of being locked into what they consider a premature agreement on the substance of the APTA. The thrust of the draft MOU they propose -- if their first preference for a "declaration" is not supported -- makes it clear that they intend to discuss the APTA in detail as part of an actual negotiation with Pakistan. RICCIARDONE