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Cablegate: Proposed U.S.-Iraq Conference On Investment

VZCZCXRO6634
OO RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUEHGB #3174/01 2760254
ZNR UUUUU ZZH
O 020254Z OCT 08
FM AMEMBASSY BAGHDAD
TO RUCPDOC/DEPT OF COMMERCE WASHDC IMMEDIATE
RUEATRS/DEPT OF TREASURY WASHDC IMMEDIATE
RUEHC/SECSTATE WASHDC IMMEDIATE 9735
INFO RUCNRAQ/IRAQ COLLECTIVE

UNCLAS SECTION 01 OF 02 BAGHDAD 003174

SENSITIVE
SIPDIS

DEPT FOR U/S REUBEN JEFFERY
DEPT PASS USTR

E.O. 12958: N/A
TAGS: ECON ETRD EINV PREL IZ
SUBJECT: PROPOSED U.S.-IRAQ CONFERENCE ON INVESTMENT
CLIMATE IN BAGHDAD

REF: A. A. BAGHDAD 3067
B. B. BAGHDAD 3097
C. C. BAGHDAD 3090
D. D. BAGHDAD 1061 AND PREVIOUS

1. (U) This is an action request. See para 7.

2. (SBU) Summary: Embassy proposes a one-day conference on
Iraq,s business and investment climate in late October/early
November. This is in response to DPM Salih's requests for a
bilateral dialogue before the end of the year. However we do
not intend for this to be a full-blown "Dialogue on Economic
Cooperation." Rather we propose using a planned visit to
Baghdad by Treasury Deputy Secretary Kimmitt, as well as a
planned business delegation organized by the U.S. Chamber of
Commerce, to focus senior GOI officials on the urgent need
for specific steps to improve Iraq,s business and investment
climate. We hope for senior participation by other USG
agencies, but because of severe constraints on embassy
resources in October will need to limit the overall size of
USG participation in the proposed conference. End summary.

DPM Salih Requests Conference
-----------------------------

3. (SBU) Deputy Prime Minister (DPM) Barham Salih has
proposed to Ambassador and EMIN that a bilateral economic
conference take place before the end of the year (refs A and
B). The embassy proposes that we build a one-day conference
on investment climate around Treasury Deputy Secretary
Kimmitt's visit in late October/early November. This would
not/not be a formal "Dialogue on Economic Cooperation" or
DEC. The last DEC took place in Baghdad in February 2008
(Ref C); we envision a large DEC in the spring with the new
U.S. Administration. Rather this session would focus solely
on the business and investment climate, with the aim of
encouraging GOI leadership to remove existing roadblocks to
new investment and private sector development, to include
full implementation of the 2006 Investment Law.

4. (SBU) DPM Salih also requested a large business event
along with the government-to-government meeting, with the
goal of concluding agreement on a few large joint venture or
investment deals. We believe it is more appropriate to focus
now on the dialogue to improve business conditions on the
ground, with a view to achieving demonstrable regulatory
improvements before a major business event next year.
However, it is important to include a private sector
component to the planned session. We understand the U.S.
Chamber (in coordination with TFBSO) plans to bring an
investor group to Baghdad in October and would be willing to
set aside some time for the group to participate in a
roundtable discussion. In addition to the private sector, we
propose seeking participation of a limited number of
representatives from other investor nations, as well as from
the World Bank (highlighting the recent findings of the IFC
"Doing Business" report which concluded that the business
climate in Iraq has worsened over the past year). On the
Iraqi side we will suggest that participants include
representatives from the Provincial Investment Commissions to
offer their perspective on impediments to new investment.

Proposed Participation and Next Steps
-------------------------------------

5. (SBU) We have discussed the general concept outlined above
with DPM Salih,s designated point person for this
conference. While the DPM,s staff remains focused on a
high-visibility event involving senior U.S. business
officials and publicizing some major deals with U.S. firms,
they have tentatively agreed to the proposal for a smaller
and more focused dialogue in late October as a first step.
They will be discussing the proposal with DPM Salih who,
along with the rest of the Iraqi government, is celebrating a
Muslim holiday for the remainder of this week (the next
working day is Oct. 6).

6. (SBU) In addition to Treasury Deputy Secretary Kimmitt, we
hope to see senior participation from a limited number of USG
agencies, and specifically propose State U/S Jeffrey,
Commerce Deputy Secretary Sullivan, DUSD Brinkley, and AUSTR
Lilienfeld. As previously announced (ref D), the Mission has
a very heavy visitor burden in October, combined with the
start of the move to the NEC. Given the priority we attach
to improving the investment climate, however, we want this
conference to take place. But we need to request very

BAGHDAD 00003174 002 OF 002


limited participation from Washington agencies (ideally
principals plus one).

Action Request
---------------

7. (SBU) We request the Department and relevant Washington
agencies discuss this concept, and the draft agenda that
follows, and get back to us by October 6 with coordinated
thinking on (a) feasibility of outlined event, (b) proposed
date(s), (c) proposed participants, and (d) specific requests
for GOI ) as host ) to consider.

8. (SBU) The following agenda is notional only and has
not/not yet been vetted with DPM Salih. Proposed venue is
the Al Rasheed Hotel in the international zone:

Proposed Title: Iraq-U.S. Dialogue on Investment Climate

9:00 Opening Remarks (5 minutes each) by DPM Salih, Treasury
DepSec Kimmitt and other senior USG officials.

9:30 GOI briefs on progress and challenges in implementation
of 2006 investment law and regulations, and the National
Investment Council including:
-- Registration of Foreign Firms
-- Allocation of Land and Land Use issues
-- Provincial Investment Councils, Roles and Capabilities

11:00 Investment Climate Best Practices: USG perspectives,
World Bank ("Doing Business Report")

12:30 Lunch

13:30 Roundtable discussion with Provincial Investment
Councils, provincial leaders.

15:00 Private Company Seminar ) What do investors want to
see before investing here? U.S. Chamber, TFBSO.

16:30 Investment Promotion for Iraq ) What needs to be done?
- Commerce, U.S. Chamber, TFBSO

18:00 Press Conference, Closing Remarks.
CROCKER

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