RAYTHEON'S RECENT VISIT AND RUMBLINGS FROM THE

UNCLAS E F T O BANDAR SERI BEGAWAN 000024 SENSITIVE NOFORN SIPDIS STATE PASS FOR EAP/MTS/COPPOLAMG STATE PASS USTR/EHLERSK BANGKOK FOR FCS/NESSJ SINGAPORE FOR DAO/SEABAUGHHK E.O. 12958: N/A TAGS: PREL PGOV USTR KIPR KINR ECON BX SUBJECT: RAYTHEON'S RECENT VISIT AND RUMBLINGS FROM THE MINISTRY OF DEFENSE SUMMARY -------------- ¶1. (SBU/NF) The Raytheon team recently briefed the Ambassador about a recent turn of events where Deputy Minister of Defense Pehin Yasmin revived a pet project, developing and building Brunei's National Modeling and Simulation Center, that a subordinate of his, Ministry of Defense Permanent Secretary Dato Mustapha had derailed while Yasmin was out ill for several months. Raytheon reported being issued a short fuse deadline from Pehin Yasmin during their meetings to sign an agreement within the next four weeks. They were instructed to finalize negotiations and move forward with commencing this important project for the Government of Brunei (GOB). Raytheon further elaborated that this directive came, during their meeting with defense officials, on the heels of a heated exchange between Pehin Yasmin and Dato Mustapha regarding contract negotiations. During his one-on-one private dinner with the Ambassador, Pehin Yasmin praised both the Ambassador and the U.S. Mission as being one of the most active and engaged diplomatic missions to ever serve in Brunei. Pehin Yasmin also discussed his rumored upcoming possible retirement, assured the Ambassador the Raytheon deal would get done and shared some cautionary words about the conservative Brunei Muslim community. The apparent home stretch indicators from Raytheon and the Ministry of Defense is welcome news for both parties. However, negative comments regarding religious freedom by a conservative element in the Muslim community, as noted by Pehin Yasmin, corroborates Ambassador's concerns regarding the true status of intra and inter faith relations. End Summary. RAYTHEON, WE HAVE LIFT OFF (ALMOST) -------------- ¶2. (SBU/NF) The Ambassador met with Raytheon Corporation executives Ray Corrigan (Brunei Country Manager),and Matthew Murray (Director of Global Strategy and Solutions) after their series of meetings held with the Brunei Ministry of Defense (MOD). Months of silence from the MOD followed the sour turn of events last July when the MOD presented Raytheon with an almost impossible list of demands to reach any contractual agreement to build and develop a National Modeling and Simulation Center. This all changed for the better during Raytheon's most recent visit. Both Ray and Matt expressed genuine excitement and belief that the deal, and more importantly the MOD, was back on track to bring negotiations to a close and proceed with this important project. ¶3. (SBU/NF) Raytheon officials reported on their visit with the MOD, which included a tour of the newly constructed and completed seven-story Knowledge Hub at Anggerek Desa. This is the second phase of three for the "iCentre" being developed by the Brunei Economic Development Board (BEDB). The top two floors to be occupied by the MOD are the envisioned location for the Raytheon designed Modeling Center. The building reportedly cost B$4.8 million and is the first "green" building in Brunei with partial solar power, motion sensor lighting and other "green" initiatives. During the tour Pehin Yasmin expressed concern that none of the committed occupants had yet begun the move in process. TelBru and the University of Brunei both have floors booked along with other commercial investors. According to the Raytheon team, with ongoing efforts of the MOD to gain approval for His Majesty the Sultan of Brunei to officiate the opening ceremony, Pehin Yasmin repeatedly complained that His Majesty would not cut any ribbon on an empty building. ¶4. (SBU/NF) In a subsequent private meeting with Pehin Yasmin and Dato Mustapha, the Raytheon team questioned again why on going negotiations had stalled and if there was any hope of reviving the deal for the modeling center. Raytheon told the Ambassador that when Pehin discovered, evidently for the first time, the massive concessions Raytheon had offered to meet the GOB's demands, he became visibly upset with Dato Mustapha. Dato Mustapha had not yet shared those concessions with Pehin Yasmin as he was still locking down a technical consultant prior to discussing further any terms and conditions for such an agreement. Pehin proceeded to verbally berate him about the delays and stove piping of information eventually switching to Malay further driving home his displeasure all in front of the Raytheon team. In the end Pehin Yasmin insisted that Dato Mustapha and Raytheon expedite the process and requested a finalized agreement for signature by both parties within four weeks time. REMINISCING WITH DEPUTY MINISTER OF DEFENSE PEHIN YASMIN -------------- -------------- ¶5. (SBU/NF) Ambassador and Pehin Yasmin shared a private one-on-one dinner for almost two hours, covering a wide range of topics. Pehin was extremely complimentary with regards to the excellent performance of the U.S. Mission and in particular the Ambassador's willingness to take on tough issues in the public forum such as Intellectual Property Rights, Trafficking in Persons and Religious Freedom. Pehin said that when His Majesty the Sultan speaks of the diplomatic corps, he often refers directly to the U.S. Ambassador as the most active representative of the diplomats serving in Brunei. He did say that he expects, but can't yet confirm, to be leaving in May when the GOB reviews all the ministerial level positions for rotation. More importantly, he discussed the rumor that Dato Mustapha has a good chance of ascending to Deputy Minister of Defense as his successor. Pehin assured the Ambassador that if the rumors of his retirement turned out to be true, he would make sure the Raytheon project was locked in before he left. ¶6. (SBU/NF) As the conversation progressed, the Ambassador asked Pehin for any advice on how to be even more effective in his work with the GOB. Pehin cautioned the Ambassador about current feelings within the more conservative elements of the Muslim community in Brunei. He indicated they were upset with the Department of State Religious Freedom report and the negative light in which Brunei was portrayed. They thought the U.S. Mission should have interceded Brunei's behalf to soften the harsh tone with the perceived power his position holds. Pehin further mused that it was ironic that they complained about this particular issue as he said, "Culturally these people (the bearded ones) do not believe in religious freedom. They only see the Muslim faith as the one true recognized faith." He further elaborated by saying, "These people are not only sympathetic to the recent religious attacks taking place in Malaysia but would burn churches in Brunei if given the opportunity." However, he did reassure the Ambassador though that, "The more tolerant Muslims, like myself, and the GOB, are keeping this small element in check and that Brunei does not tolerate any level of extremism regardless." (Note: The comments from Pehin Yasmin on religious freedom are a clear reminder that while Brunei enjoys a relatively relaxed environment for other religions, there is clearly a potential element not in favor of this tolerance. The continued uphill battle on allowing religious teaching in classrooms for non-Muslim faiths appears to be some degree of evidence this element exists and has at least a degree of influence within the GOB. End Note) COMMENT -------------- ¶7. We will continue to monitor closely the negotiations between the MOD and Raytheon for this agreement. If the signature takes place within the proposed time frame of four weeks, the deal will be effectively in full swing prior to any potential departure of Pehin Yasmin. In light of Dato Mustapha's public undressing in front of the Raytheon team, it will be interesting to see what potential roadblocks he throws up either if given early notice of impending ascension or vice versa if Pehin Yasmin sees another term assignment. It appears critical, regardless of the outcome in upcoming ministerial rotations, for Raytheon to get Dato Mustapha going the same direction and ensure that all parties have access to key information going forward after the loss of time and progress thanks to his recent and effective stovepipe efforts. End Comment. TODD