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Cablegate: Iraq: First Usg Working Meeting with New Minister

DE RUEHGB #3031/01 2330358
R 210358Z AUG 06





E.O. 12958: N/A

1. (SBU) Summary. On August 13, IRMO, USDA, USAID, and
Econoff met with new Minister of Agriculture, Dr. Yaarub
Nadhum Al-Obodi; the Deputy Minister, Dr. Subhi Al-Jumaily;
and the Director General for Planning, Mr. Sabah This
meeting was only the second between post officials and the
minister, although post has made frequent requests for
meetings. USAID presented the results of the ARDI
program. USDA discussed its programs to assist the GOI in
agriculture, US support for the poultry industry through
private industry programs, and animal health issues
regarding avian influenza (AI) and import issues, such as
the ban on US beef imports into Iraq due to BSE concerns.
IRMO discussed a current USG program to set up a modern
food testing laboratory in Iraq. The Ministry of
Agriculture (MoA) expressed keen interest in setting up the
laboratory. Econoff inquired about the GOI's tariff
program and was told an extensive tariff schedule has been
developed with tariff rates ranging from 0% to a maximum of
15%. MoA officials were critical of some past USAID
program because, they argued, the projects were not
coordinated with the MoA, and in some cases provide
inadequate or inappropriate assistance. The MoA was also
critical of the USDA poultry program which it believes does
not help poor farmers. The MoA said it wants to move
forward with the USG in closer cooperation and more
information sharing that will address some of the concerns
with prior agricultural programs. End Summary.

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2. (U) On August 13 IRMO's Senior Consultant for
Agriculture, the Agricultural Attach from USDA, USAID's
Deputy Director of the Office of Economic Growth and
Agriculture, and Econoff held their first working meeting
with the new Minister of Agriculture, Dr. Yaarub Nadhum
Al-Obodi; the Deputy Minister, Dr. Subhi Al-Jumaily, and
Mr. Sabah the Director General of Planning (DG). The
minister opened the meeting noting the importance of the
agricultural sector to Iraq, and asked for further USG

3. (U) USAID presented an overview of the agricultural
projects under the Agriculture Reconstruction and
Development Program for Iraq (ARDI), noting that ARDI is
scheduled to be phased out at the end of 2006, and provided
an updated list of all ARDI accomplishments as well as
future planned activities. USAID noted that ARDI is
collaborating with the MoA on several specific initiatives,
namely the national water strategy for Iraq, an
agro-ecological zone mapping center for use as a planning
information tool, and a wholesale price monitoring and
information system for vegetables, fruits, meats and dry
goods in 18 major agricultural markets nationwide. USAID
asked for MoA's views on activities related to growing a
vibrant and competitive agribusiness sector in Iraq.

4. (SBU) The deputy minister stated that USAID should be
more of a partner so that the goals of the MoA can be
reached. He indicated that there is a need for more
cooperation between USAID and the MoA, and that there are
"different views" between USAID and the MoA with regard to
how to develop projects. Dr. Subhi mentioned that there is
good collaboration in some projects, such as agriculture
statistics training in the agro-ecological mapping
projects. The DG emphasized that the relationship between
USAID and the MoA needs to be strengthened because the MoA
believes some projects undertaken in ARDI were not very
relevant to Iraq's needs. Mr. Sabah specifically mentioned
the olive oil project that, he believed, had received
inappropriate equipment which he critized as used and
outdated. He suggested that the MoA needs to review the
projects with USAID in order to ensure the MoA can provide
information that will help the project implementers. The
deputy minister stated that in the past the MoA tried to
evaluate project ideas with USAID, but the MoA was
informed that the work was being performed under
contractual agreements with implementing partners, and so
consultations were unnecessary. He emphasized that there
is a great need to "sit together" with USAID to determine
project priorities.

5. (SBU) The minister said he would like to evaluate ARDI's
programs and projects, and stated there is a need to share
information. The DG highlighted some areas of concern that
have been discussed in the past with US agencies, stating
that the MoA's concerns have not been addressed in the
agriculture projects undertaken by the implementers. The

BAGHDAD 00003031 002 OF 003

DG specifically mentioned that the soil salinity problem in
central and southern Iraq has not been investigated
although the MoA is now undertaking some wheat project work
in these areas. Mr. Sabah said that the farmer micro loan
program of the Agriculture Cooperative Bank (ACB) has been
very successful, and that the program needs more funding in
order to help more farmers. (Comment. Since solid
statistics are hard to come by in Iraq, the success of this
program is difficult to assess independently. End

6. (SBU) IRMO informed the MoA that it has recommended that
the GOI invest more money in its farmer micro loan program,
and assist the ACB to open up other credit programs for the
agriculture community. IRMO also indicated that
agribusiness development will be a major program area in
the next two to three years, and that IRMO plans to
establish some credit programs for agribusiness
development, although it is not certain when such programs
will begin. The deputy minister said that the farmer micro
loan program of the ACB needs additional funding now and
cannot wait for the GOI to provide it. The MoA has asked
the GOI for more funding, but as yet there has not been any
response according to the deputy minister.

7. (SBU) The DG indicated that assistance is needed in many
provinces of Iraq with regard to integrated pest management
(IPM). Technology and funding are need so that a
meaningful IPM programs can be implemented in the target
provinces, and he recommended that the USG put this type of
program on its development agenda. The deputy minister
said that there is clearly no objection to developing
programs to assist agribusiness in Iraq, but there should
be more collaboration with the MoA in planning these
programs. He re-emphasized that the MoA would like to
examine the results of past projects in order to develop
clear directions for future projects. IRMO reminded the
minister and deputy minister that post's Joint Agriculture
Task Force (JATF) was created nearly a year ago so that all
major agencies and groups working in the agriculture
sector, and the MoA, could meet on a regular basis to
coordinate activities and communicate results. Dr. Subhi
stated that the MoA will appoint a representative to the
JATF, and the representative will be able to attend the
next JATF meeting in the International Zone (IZ).

8. (SBU) USDA summarized the August 1 visit to Baghdad by
the US Secretary of Agriculture. The joint agreement to
enhance the agriculture education and extension capacities
of Iraq, signed during the Secretary's visit, includes
several ministries in addition to the MoA. USDA presented
copies of the agreement in Arabic and English to the
minister. USDA said it will send specialists in strategic
planning, extension/education, and food safety from the
U.S. to Baghdad to work with the MoA. The specialists
could arrive in September. USDA outlined its support for
Iraq's poultry industry through the Food for Progress
program and the US Grains Council's revolving credit
project. The DG sharply criticized the project because he
believes that the more prosperous poultry producers were
being helped, and not many other poorer farmers and
livestock breeders.

9. (SBU) The DG also noted that the water buffalo is an
important animal in many parts of the country, especially
the south, but that there are no programs to assist owners
or the broader livestock sector. USDA explained that the
revolving credit for the poultry producers is a private
sector program to assist the commercial poultry producers
in Iraq, and was not a program that could be modified by
the USG in the manner the DG suggested.

10. (SBU) USDA explained that it and other agencies are
ready and willing to collaborate with the MoA on animal
health issues, in particular with respect to AI. Although
there has been a quiet period during the past months, a
reoccurrence of AI could occur and the MoA will need to be
prepared. USDA stated that there are many different
agencies of the GOI -- MoA, Ministry of Trade (MoT),
Ministry of Health (MoH) -- with equities in food safety
regulations. Enforcement of these regulation and food
safety rules should be based on science, and be consistent
with international standards and WTO principles. USDA
brought up the case of Iraq's ban on US beef products due
to bovine spongiform encephalopathy (BSE) concerns, even
though other US trading partners (such as Japan) have

BAGHDAD 00003031 003 OF 003

re-opened their markets to US beef and beef products. The
DG asked if USDA could provide some type of "international
document" to indicate the safety of US beef products,
including an indication that the U.S. is "BSE-free." USDA
explained that the U.S. cannot say it is BSE-free, but that
US programs far exceed the guidelines of the OIE (World
Animal Health Organization) and, based on these guidelines,
trade in US beef is accepted. USDA suggested that this
topic requires a separate meeting with MoA officials so
that all pertinent and relevant technical information can
be exchanged.

11. (SBU) Econoff asked about the actions being taken in
the MoA with regard to agricultural product import tariffs,
and who is the appropriate point of contact at the MoA for
this issue. The deputy minister stated that he is the
proper contact since he chairs the inter-ministerial
committee (MoA, Ministry of Finance, MoT, and the Central
Bank of Iraq) that is developing and setting the new tariff
schedules. The DG explained that the committee has already
studied the tariff schedules of 27 countries worldwide, and
hopes to have its final recommendation ready to be sent to
the GOI cabinet before the end of 2006. The proposed
tariffs range from 0% to a maximum of 15%. According to
the deputy minister the document runs to approximately 200
pages, but the MoA could not at this time provide a copy of
the schedule to the USG. The DG also mentioned that the
MoA is beginning to review a plan to change the
agricultural subsidy systems from subsidizing inputs to
subsidizing outputs.

12. (U) IRMO outlined USG interest in assisting Iraq in
setting up a modern food analysis laboratory. Possible
locations and contact persons need to be determined very
soon or the funding will expire. IRMO told the MoA that
the USG was ready to purchase laboratory equipment for a
food analysis laboratory that can conduct all the necessary
analyses and assays of food articles for export. IRMO
suggested that the MoA consider meeting with post officials
to discuss possible locations of the laboratory and the
equipment needs. The deputy minister indicated that he
would be willing to meet in the IZ to discuss equipping the
laboratory. He mentioned that it would be necessary to
discuss this project with other ministries (MoH, MoT)
because the responsibilities for conducting food analyses
are spread across the different ministries.

13. (SBU) Comment: The meeting was cordial overall,
although the MoA criticized USAID for failing to coordinate
programs with the MoA. USAID countered that the earlier
programs were developed unde the CPA, and that it would
work closely with the MoA in the future. With regard to
the DG's especially strong criticism of the poultry
programs, it seemed the DG does not fully understand how
the program was developed, and the difference between
private and public programs. The deputy minister did
commit to sending a representative to the next JATF meeting
in the IZ, which has been a long running request by the USG
side. Post hopes that MoA's participation in the JATF will
lay the groundwork for smoother relations and better
communication between the USG and the MoA on issues of
cooperation, information exchange and program development.
End Comment.

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