PORT-AU-PRINCE: FEBRUARY 12 CODEL PELOSI VISIT TO HAITI

UNCLAS PORT AU PRINCE 000176

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: PREL PINR HA PGOV AID EAID
SUBJECT: PORT-AU-PRINCE: FEBRUARY 12 CODEL PELOSI VISIT TO HAITI


1. (SBU) SUMMARY: On February 12 Speaker of the House of
Representatives Nancy Pelosi, along with the 11 Senators and
members of Congress, arrived in Port-au-Prince to observe U.S.
relief efforts and to discuss the status of those efforts with US
and GOH officials. President Preval told the Codel they are
rallying to address the monumental challenges confronting them, and
with a vision that looks beyond Haiti's immediate needs. Preval
stated that, in the short-term, Haiti needs help in addressing the
problems of displaced persons, a budget shortfall, stimulating the
economy, and holding elections. Preval also asked for assistance
in encouraging U.S. private investment, decentralizing foreign
investment, creating jobs, and building roads. Prime Minister
Bellerive supported the concept of establishing a trusteeship
comprised of the GOH and major donors to coordinate the
disbursement of financial aid. END SUMMARY.



CODEL Members and Participants




2. (SBU) Members of the Senate:

* Tom Harkin, Chairman Health Education and Labor (D-IA)

* Bill Nelson, Budget, Finance and SASC (D-FL)

* Amy Klobuchar, Judiciary (D-MN)

* Frank Lautenberg, Appropriations (D-NJ)

* George LeMieux, SASC (R-FL)



Members of the House of Representatives:

* Nancy Pelosi, Speaker of the House (D-CA)

* Charles Rangel, Chairman Ways and Means (D-NY)

* John Conyers, Chairman Judiciary (D-Mich)

* James Oberstar, Transportation and Infrastructure (D-MN)

* Donna Christensen (D-V.I.)

* Sheila Jackson Lee (D-TX)

* Earl Blumenauer (D-OR)

Also accompanying the CODEL were Assistant Secretary for
Legislative Affairs Rich Verma, seven members of the Senate and
House staff, and two representatives of the Senate and House UNMC
liaison offices.



CODEL Itinerary




3. (SBU) Charge' David Lindwall, U.S. Relief Coordinator
Ambassador Lewis Lucke, and U.S. Joint Task Force (JTF) Commander
General Ken Keen briefed the CODEL on the present situation and
Embassy, JTF, and USAID/DART activities in support of relief
efforts. The CODEL took a windshield tour of the city center
stopping briefly at the ruins of the Capital's historic cathedral,
where the CODEL observed a moment of silence for those who died in
earthquake. (NOTE: Preval had designated February 12 as a
national day of mourning. END NOTE.) CODEL members also toured a
USAID-sponsored emergency medical facility and discussed the
delivery of humanitarian aid with key NGO representatives.

Discussion with President Preval, PM Bellerive and Cabinet Members




4. (SBU) The CODEL met with President Rene' Preval, Prime
Minister Jean-Max Bellerive, and members of Preval's staff and
cabinet at the GOH's temporary HQ. Preval thanked President and

Mrs. Obama, the U.S. Congress, and the American people for bringing
all possible aid to Haiti. Speaker Pelosi conveyed the concerns of
Congress and the American people for the welfare of Haiti and added
that the CODEL was present to demonstrate America's commitment to
Haiti.




5. (SBU) Preval noted the GOH has made "much progress" since
the earthquake. He explained the government had removed 217,000
bodies from the rubble, and it is working to clear roads and
re-establish telephone and electricity service. He added that
USAID has done a tremendous job of providing food to displaced
person camps. In response to Senator Harken, who urged the
government to move displaced person camps in low areas to higher
ground, Preval replied USAID is working to accomplish that goal.
But first, he said, the rubble must be removed, "one thing at a
time."

GOH Short Term Needs




6. (SBU) Preval said there will be tremendous social problems
if displaced persons remain in the streets. "We must not weaken
the economy" with the large amount of aid pouring into Haiti.
Instead of distributing imported food, he explained, there is a
need to stimulate the economy and support agricultural jobs by
buying local products whenever possible. Preval acknowledged the
establishment of a USAID program to address those issues, but he
added that more local jobs must be created.




7. (SBU) Preval asked for elections support, noting the
Provisional Electoral Council (CEP) building was destroyed in the
quake and that it lost personnel, election records, and election
materials. Many citizens had lost their voter identification cards
and have moved out of their voting districts, he continued. Preval
explained that on May 10, Parliament's mandate expires and without
the House of Deputies and only two-thirds of the Senators still in
office, "we have a problem." (NOTE: The parliamentary elections
originally scheduled for February 2010 have been cancelled. END
NOTE)



Post-Quake Budget Issues - Ultimately Cured by Economic Development
and Job Creation




8. (SBU) Finance Minister Baudin said following the quake,
GOH revenues had plummeted by 80 percent due to lack of income and
property tax receipts. Preval added the owners of 250,000 damaged
homes would no longer pay property taxes. The temporary closure of
the main port had also resulted in the loss of import duties,
according to Baudin. The remaining 20 percent of GOH revenues does
not cover one-half of the payroll for public employees, which
amounts to USD 25 million per month. The government has been able
to meet the public employee payroll thanks to a budget surplus; but
without future budget support from foreign donors, making the
government payroll will be difficult. "We ask for a lobbying
effort," Baudin said, "to attract U.S. private investment in
Haiti," which will create jobs and increase government receipts.
Furthermore, it is important to create those jobs outside of
Port-au-Prince if possible, so that those who have migrated out of
the capital will not be compelled to return.




9. (SBU) Central Bank President Castel said, as a result of
destroyed businesses and loan defaults, 40 percent of Haiti's
banks' portfolios may have been lost. Those businesses can rebuild
only if credit is available, commenting "we need to extend credit
in order to create jobs," and added "we cannot raise revenue
without jobs." Castel urged the American legislators to include
funds to recapitalize the banks in any budget supplemental.
Senator Harkin mentioned that Congress will be considering a
supplemental appropriation bill, and requested a list of GOH needs
for the remainder of the fiscal year.

Coordination of Expenditures - Trusteeship Proposal




10. (SBU) Senator Nelson suggested that the GOH establish a
trusteeship with authority to disburse funds contributed by donors.
Prime Minister Bellerive stated that he discussed the subject of a
trusteeship with Counselor Cheryl Mills, and that the GOH supports
the idea, provided the body would be transparent. Bellerive added
that the trusteeship should be governed by an "International Donor
Board" consisting of the largest donors, and co-chaired by the GOH.
He suggested the body should first adopt a plan and then vote to
disburse funds for projects consistent with the plan. Bellerive
said the GOH would propose this structure to the donors meeting in
April.



Think Big and Outside of Port-au-Prince




11. (SBU) Speaker Pelosi urged Preval to "think big." "We're
receptive" she added, "and we would like to hear that Haiti is
going toward a different place. If so, you would receive even more
support, and we see this as an opportunity to be even more
helpful." "You can teach the world how to respond to such a
disaster, and become a model." Pelosi stated that sometimes such a
tragedy can be a great opportunity, and suggested the examples of
San Francisco and Italy.




12. (SBU) Preval replied that since 2004, Haiti has made
significant progress in reducing inflation, growing GDP, expanding
agricultural production and adding jobs. But now, after the
earthquake, it would be a mistake to focus only on Port-au-Prince.
"To concentrate on the disaster in Port-au-Prince in the wrong
route," he said. If Haiti is to continue its progress, and exceed
it, "the country needs to decentralize" stated Preval. "We must
not only rebuild Port-au-Prince, but also Haiti." In order to
decentralize, "we need to develop jobs in Les Cayes, Cap Haitien,
and other cities - but first we need roads." "We must invest in
the provinces, or we will not be able to rebuild Port-au-Prince."



Comment




13. (SBU) COMMENT: Preval was in top form during the Pelosi
meeting: energized, engaged, organized, articulate and gracious.
Preval and his advisors demonstrated they are fully aware of the
monumental challenges confronting them, and with a vision that
looks beyond immediate relief and reconstruction needs.




14. MINIMIZE CONSIDERED
MERTEN