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Cablegate: Mdc/Donors Meet to Discuss Aid Priorities

VZCZCXRO5740
PP RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN
DE RUEHSB #0709/01 2341329
ZNR UUUUU ZZH
P 211329Z AUG 08
FM AMEMBASSY HARARE
TO RUEHC/SECSTATE WASHDC PRIORITY 3318
INFO RUCNSAD/SOUTHERN AF DEVELOPMENT COMMUNITY COLLECTIVE
RUEHDS/AMEMBASSY ADDIS ABABA 2338
RUEHBY/AMEMBASSY CANBERRA 1615
RHEHAAA/NSC WASHDC
RHMFISS/EUCOM POLAD VAIHINGEN GE
RUEHGV/USMISSION GENEVA 1487
RUZEJAA/JAC MOLESWORTH RAF MOLESWORTH UK
RHEFDIA/DIA WASHDC
RUEAIIA/CIA WASHDC

UNCLAS SECTION 01 OF 02 HARARE 000709

SENSITIVE
SIPDIS

DCHA/AA FOR MIKE HESS
AFR/AA FOR KATE ALMQUIST AND FRANKLIN MOORE
AFR/SA FOR ELOKEN, LDOBBINS, JKOLE
DCHA/OFDA FOR KLUU, ACONVERY, TDENYSENKO, LMTHOMAS
DCHA/FFP FOR JBORNS, JDWORKEN, LPETERSON, ASINK

E.O. 12958: N/A
TAGS: EAID PHUM PREF PGOV PREL ZI
SUBJECT: MDC/DONORS MEET TO DISCUSS AID PRIORITIES

-------
SUMMARY
-------

1. (SBU) On August 15, at the request of the Movement for Democratic
Change (MDC), MDC leadership met with major donors that support the
World Bank's Multi-Donor Trust Fund (MDTF) to discuss
post-transition economic recovery and development strategies. The
meeting was an opportunity for the MDC and donors to hear from one
another the most urgent sectoral needs in the period immediately
following a political transition. Through donor consultation and
internal planning, the MDC is preparing the groundwork to rapidly
address humanitarian, economic stabilization, and development needs
should the MDC achieve power as a result of the ongoing negotiations
with ZANU-PF. MDC appears ready to quickly engage with the donor
community, but does not yet fully understand the intricacies of
donor aid modalities and coordination mechanisms. END SUMMARY.

---------------------------------------
MDC looks towards the transition period
---------------------------------------

2. (SBU) MDC leadership coordinated a meeting with the heads of
donor agencies that support the MDTF on August 15. The all-day
meeting provided an opportunity for the MDC to share its vision for
immediate, recovery-oriented needs in a transition period. Eddie
Cross, the MDC head of policy, and Mungai Llenieye, Acting Country
Director of the World Bank, facilitated the meeting. Most of the
MDC secretaries (shadow ministers) were in attendance and presented
their specific sectoral needs. Overall, the MDC presentations were
general in nature (not technical) and did not offer ideas that
differ markedly from what donors are already thinking.

3. (SBU) Donors presented aid effectiveness principles (e.g.,
ownership, accountability, harmonization, managing for results, etc)
and focused on how to most effectively manage aid. Donors urged the
MDC to establish an office to coordinate donor assistance. The MDC
stated that there would be a unit in the MOF to do this. Although
one already exists, the MDC recognized that it needs to be
strengthened considerably.

4. (SBU) The sectoral presentations mirrored the MDTF's planned
Emergency and Economic Recovery Program, which the World Bank plans
to develop over the next few months for presentation to donors and
subsequent funding, when a transition period begins. The sectors
discussed included:

(1) Economic stabilization - The MDC plans to implement a rigorous
fiscal stabilization strategy within days of assuming control of the
RBZ. It will immediately float the dollar, remove price controls,
stabilize exchange rates, and eliminate subsidies. The MDC
requested considerable social safety net support to counter negative
effects of the above actions.
(2) Food security - The MDC wants to redesign food aid to overcome
dependency. It stressed that the focus should be on production and
that inputs such as seeds and fertilizers were critically
important.
(3) Small-scale agriculture - The MDC stressed again the importance
of agricultural inputs and the need to strengthen markets.
(4) Power system rehabilitation - The MDC stated that it did not
need support in this sector, with the possible exception of
technical assistance related to energy policy. Interestingly, the
MDC said it would not privatize ZESA.
(5) Water system rehabilitation
(6) Health service recovery
(7) Education recovery
(8) Public financial management strengthening
(9) Parastatal Reform

5. (SBU) The MDC also stressed the immediate urgency of programs to
address: psychiatric treatment for victims; reconciliation;
assistance for more than one million returning refugees; reform of
the security sector; and private sector development. It saw
recovery programs commencing as soon as possible.

--------------------------------------
MDC Mayors Pledge Non-Partisan Agendas

HARARE 00000709 002 OF 002


--------------------------------------

6. (SBU) The following day, the MDC shadow ministers met with the
MDC mayors from across the country to discuss how to use local
resources, e.g., service delivery, to deal with urgent humanitarian
needs at the community level. The meeting was significant in that it
established a network of democratic local government officials who
committed themselves to honesty, integrity, anti-corruption, and
transparency in the conduct of council business. In addition,
participants pledged to promote a non-partisan local government
agenda and to unify community leaders, given that they are
inheriting post-conflict localities. Mayors from Harare, Bulawayo,
Gweru, Mutare, Victoria Falls, Kadoma, Kariba, and Masvingo were
among those in attendance.

-------
COMMENT
-------

7. (SBU) The MDC is to be commended for reaching out to donors to
better identify needs and priorities, and coordinate efforts. It is
encouraging that local-level officials, who will have the best
access to evaluate implementation of recovery efforts, are working
together and in concert with MDC national-level leadership. Despite
efforts to soften expectations, MDC leadership appears to believe
aid will be immediately available once an agreement is reached, and
in large sums. All this of course begs the question as to if and
when the MDC will be in a position to direct the government and
coordinate assistance. END COMMENT.


MCGEE

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