A/S FELTMAN AND FM ZEBARI CO-CHAIR DIPLOMATIC JCC-

C O N F I D E N T I A L BAGHDAD 000234

SIPDIS

E.O. 12958: DECL: 05/27/2018
TAGS: IZ KU PGOV PREL SY
SUBJECT: A/S FELTMAN AND FM ZEBARI CO-CHAIR DIPLOMATIC JCC-
PART II: CHAPTER VII

REF: 09 BAGHDAD 130342

Classified By: Acting Deputy Chief of Mission Gary A. Grappo for reason
1.4 (b) and (d).


1. (C) Summary: On January 24, Assistant Secretary for
Near Eastern Affairs Jeffrey Feltman, A/DCM, and a delegation
of experts on Chapter VII issues met with Iraqi Foreign
Minister Hoshyar Zebari and an interministerial committee of
Iraqi experts at the Ministry of Foreign Affairs in Baghdad.
The discussion marked the inaugural meeting of the Diplomatic
Joint Coordination Committee (JCC),and focused on regional
relations and the way forward on a host of Chapter VII
issues, as well as plans for future bilateral engagement and
cooperation. This cable focuses on the latter half of the
JCC, which consisted of a discussion of Chapter VII issues.
Part I of this series focuses on the JCC's discussion of
regional relations. End summary.


2. (C) NEA A/S Jeffrey Feltman co-chaired the first
meeting of the Diplomatic and Political Joint Coordination
Committee with FM Hoshyar Zebari at the MFA on January 24.
The Iraqi interministerial committee at the meeting included
Zebari's COS Sroud Najib, DFM Labeed Abbawi, Senior Policy
Advisor Fareed Yasseen, Ambassador Mohammed al-Hamameidi, PM
legal advisor Fadel Jawad Kadhum, and PM Advisor Sadiq
Rikabi, as well as other experts. The U.S. side included
A/DCM, Deputy Pol/C, NEA Senior Advisor Elissa Slotkin, USUN
Deputy Political Counselor Ellen Germain, NSC Advisor Peter
Vrooman, Attorney Advisor Jeremy Sharpe, IO officer Bill
Haldeman, and Iraq desk officer Wa'el Alzayat. FM Zebari
welcomed A/S Feltman and his delegation to Iraq and stated
that the messages conveyed by Vice President Biden during his
visit the previous weekend "reinforced the depth of the
U.S.-Iraq relationship".

CHARTING A PATH FORWARD ON WMD
--------------


3. (C) International Organizations Director Mohammed
Hamameidi initiated the JCC's discussion of WMD, stating that
the GOI is moving towards resolution of outstanding WMD
requirements within the prescribed timeframe. Hamameidi laid
out next steps in the WMD discussion, recapping that FM
Zebari sent a letter along the lines of the draft proposed in
ref A to the President of the Council and the Director
General of the IAEA. He said this would be followed by a
determination and letter from the IAEA verifying Iraq's
compliance with WMD requirements and hopefully a resolution
within the Security Council before March 1. Attorney Advisor
Jeremy Sharpe raised the issue that the letter submitted by
the MFA displayed several material differences from the draft
suggested by the USG. PM Legal Advisor Fadel responded that
the MFA can work with the USG to iron out any material
differences from the suggested draft that require resolution.
Deputy Pol Counselor Germain noted that the letter generated
"good atmospherics" and a generally positive response from
Security Council groups within the first hours of its
receipt. She stressed that as the letter is forwarded to
world capitals, the USG and MFA should work together to form
an effective presidential statement.


4. (C) FM Zebari added that the GOI has a plan for
ratifying the Additional Protocol (AP) and that it is
currently on the agenda in the Iraqi Parliament, but remains
unaddressed due to failures to reach quorum. A/S Feltman
echoed VP Biden's points earlier in the week, emphasizing
that resolving WMD before the March 7 elections would send
the right message to the international community, and that
Qthe right message to the international community, and that
the USG needs the GOI to work with members of the Security
Council so that the way forward does not appear to be a USG
initiative. The FM agreed to the U.S. suggestion to dispatch
a high-level team to New York next month to advocate lifting
WMD resolutions.

U.S. VICTIMS CLAIMS AND THE QUEST FOR A NUMBER
-------------- --------------


5. (C) PM Legal Advisor Fadel opened the discussion of
American victims claims, stating that the GOI is awaiting the
USG's response on the text it proposed. Fadel elaborated
that a committee is deliberating an amount for the GOI
counterproposal, which will require agreement from the Prime
Minister and Parliament before it can be offered to the USG.
Attorney Advisor Sharpe asserted that a counterproposal from
the GOI on American claims is not dependent on a a final text
of the settlement document, adding that because the scope of
the agreement is closed, a counterproposal from the Iraqi
side is the most important catalyst for moving forward on the
claims issue. Sharpe also raised the point that because the

claimants took their cases to Congress, the latter is now an
essential piece of the negotiations and cannot be overlooked.


6. (C) PM Advisor Rikabi offered the view that excluding
September 11 and Oklahoma City cases from the amount will
complicate discussions on the Iraqi side, as will the recent
Blackwater developments. Special Advisor Slotkin noted
Rikabi's viewpoint and stated that the USG is willing to help
by working on putting together correct language for the
counteroffer, but that the USG will then need an amount from
the GOI. FM Zebari concluded the discussion, stating that
the Council of Ministers (COM) originally formed a commission
to resolve the claims and DFI issue, and that the MFA
recently formed a new commission on Chapter VII with some of
the members of the former commission. Claims, and other
Chapter VII-related issues are "MFA territory," he asserted,
and then wryly intimated to the group that GOI decisionmakers
already "have a number" in mind to settle the Amcit claims.

OIL FOR FOOD AND DEVELOPMENT FUND FOR IRAQ
--------------


7. (C) FM Zebari shifted the JCC's focus to Oil For Food
(OFF),thanking the U.S. delegation for its assistance with
the passage of UN Resolution 1905 and sharing that the GOI is
currently clearing 76 disputed OFF contracts in two GOI
committees and examining alternatives to the Development Fund
for Iraq (DFI). He stated that on April 1, the GOI will
issue a letter outlining next steps, which will include
opening an account at the Federal Reserve Bank as a
substitute for the DFI, to be managed by the Central Bank of
Iraq (CBI),or opening an account directly at the CBI. Head
of the Supreme Auditor's Office Abdul Basit Saeed pointed out
that the protection of immunities could be a potential issue
if the account is opened directly at the CBI. A/S Feltman
proposed that the US Embassy work with Dr. Abdul Basit to
explore the two options and find a way forward.


8. (C) The FM stressed that the GOI is making progress on
both WMD and OFF issues. He said that A/DCM alerted him that
the GOI would receive a letter stating it will have 90 days
to resolve claims, but that the GOI needs to resolve disputed
contracts in order to pay for these claims. FM Zebari said
he is hopeful the GOI will meet its obligations under 1905
and submit both required reports by April. Zebari also asked
the USG to secure a host of archived Iraqi documents on OFF
that are currently in a palace under USG control. Post is
prepared to facilitate this request.


9. (C) Senior MFA advisor Mohammed al-Haj Hamoud urged the
USG to renew a presidential order, scheduled to expire in
May, for one year until the GOI can resolve claims. PM Legal
Advisor Fadel added that another concern is the GOI's need to
prepare itself for next year by securing the GOI's accounts
and assets around the world and, with USG support, find a way
to get out of Chapter VII and resolve the DFI. A/S Feltman
proposed initiating involved conversations between U.S.
Embassy Baghdad's legal advisors, A/DCM, and Dr. Abdul Basit
to resolve the particulars of the DFI issue. Because the DFI
has been extended for a year and there has been some progress
on claims, he further stated, there may be justification for
seeking an extension of the executive order. NSC Advisor
Vrooman indicated that the group would work with economic and
treasury experts to lay the groundwork to extend the
Qexecutive order. Attorney Advisor Sharpe stressed that the
U.S. victims claims issue drives the DFI, and the most
important next step is to resolve the victim claims before
May to remove "the single, greatest impediment" to an
extension.

BILATERAL INITIATIVES AND NEXT STEPS
--------------


10. (C) Upon concluding the discussion of Chapter VII
issues, Senior MFA Policy Advisor Fareed Yasseen asked A/S
Feltman whether Iraq is still an agenda item in meetings with
the P-5 and other countries. A/S Feltman responded that
discussions about Iraq differ from a few years ago, and
currently focus on an emphasis that Iraq is a sovereign state
with which the U.S. has a partnership. To this end, the A/S
asked Iraq Desk Officer Alzayat to share plans for the
upcoming Mid-level Diplomats Program. Alzayat conveyed the
USG's anticipation of the third visit of Iraqi diplomats to
Washington this year to attend courses at Georgetown
University and participate in an orientation tour of USG
agencies and offices. He stated that Washington will work
with the MFA and the U.S. Embassy to finalize a list of
participants. A/S Feltman and FM Zebari adjourned the JCC
meeting by agreeing to a February JCC working group session
via videoconference.



11. (C) The JCC identified several action items for
various JCC participants, the U.S. Embassy in Baghdad, and
the Department. Embassy discussions following the JCC
revealed the following JCC-related action items:

- Resolve material differences between the MFA's letter to
the IAEA and Security Council and the draft proposed by the
USG (reftel). Action: Legal and USUN

- Determine the best timing for Senior Iraqi MFA
interventions on WMD at the Security Council. Action: USUN

- Address Iraq,s stated need to amend Article 5 of the draft
U.S.-Iraqi Claims Settlement Agreement to provide for a
mechanism to study potential Iraqi claims against the United
States. Action: Legal

- Identify when the UNSC letter regarding terms of payment
for OFF will be sent. Action: USUN

- Examine options for establishing the groundwork for an
extension of the executive order scheduled to expire in May
and whether an extension should be used as leverage for
conclusion of the U.S. citizen claims agreement, noting
renewed interest by Rep. Braley and other members of Congress
in pursuing a legislative solution if a claims agreement is
not soon concluded. Action: Econ, Legal

- Continue to work with MFA to determine how best to transfer
archived documents to MFA custody. Action: Econ, MFA

- Suggest terms of payment via a Federal Reserve account for
the GOI and explore options for setting up the account
Action: Econ, Treasury, Legal

- Structure and move forward with the Mid-level Diplomats
Program discussed at the JCC. Action: NEA/I, POL


12. (U) Assistant Secretary of State for Near Eastern Affairs
Jeffrey Feltman approved this cable.
HILL