Cablegate: Iraq Compact: Dec 10 Bcg Meeting Creates "A

VZCZCXRO3653
OO RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUEHGB #4536 3470910
ZNR UUUUU ZZH
O 130910Z DEC 06
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC IMMEDIATE 8456
RUEATRS/DEPT OF TREASURY WASHDC IMMEDIATE
INFO RUCNRAQ/IRAQ COLLECTIVE PRIORITY

UNCLAS BAGHDAD 004536

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: ECON EFIN IZ
SUBJECT: IRAQ COMPACT: DEC 10 BCG MEETING CREATES "A
FEELING OF SUCCESS"

REF: CLASSIFIED BY AMBASSADOR KHALILZAD FOR REASONS

1.4 (B) AND (D).

1. (SBU) SUMMARY. On December 10, 2006 Iraq,s Prime
Minister Nouri al-Maliki convened a session of the Baghdad
Coordination Group (BCG) attended by several Ambassadors
posted in Baghdad, including Ambassador Khalilzad. Deputy
Prime Minister Salih and three key GOI Ministers including
Planning, Finance, and Oil were also in attendance. The
Prime Minister announced the completion of the International
Compact for Iraq (ICI) documents (distributing Arabic and
English copies to the group) and that a signing ceremony
would be convened in early 2007. The guests applauded this
accomplishment and reiterated their support for Iraq. Prime
Minister al-Maliki noted the positive atmosphere and
indicated that it gave him &a feeling of success8 to see
that the momentum still exists. End Summary.

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The Signing Ceremony
--------------------

2. (SBU) The Prime Minster indicated that the Compact
Working Group (CWG) is currently engaging several countries
about hosting the final conference and hopes to announce a
date and venue in the near future. He urged the group to
encourage their respective capitals to send senior level
representation to the final ceremony noting that it will be
an opportunity to discuss Iraq,s vision for the security and
economic climate, as well as political reconciliation and its
relationship with neighboring countries. Ambassador Khalilzad
praised the GOI for their progress and reiterated the
importance of announcing a date and venue very soon, and to
use the time in between to firm donor commitments. The EU
Ambassador echoed this sentiment, noting that January &is
tight8 in European capitals, although overall the group
seemed eager for an early signing conference. The Italian
Ambassador expressed an eagerness for the final meeting and
assured senior level Italian attendance. In DPM Salih,s
closing remarks, he announced that the final conference would
take place the second or third week of January.

-----------------
Donor Commitments
-----------------

3. (SBU) Prime Minister al-Maliki announced that Iraqi debt
exceeds $75B and he hopes that Iraq,s friends will consider
&liberating Iraq from this burden8 in order to spur the
economy and reconstruction. Ambassador Khalilzad echoed this
thought and encouraged debt forgiveness from all countries,
specifically noting that some countries &have not moved at
all (to forgive debt).8 Ambassador Khalilzad also asked
that countries consider commitments beyond debt forgiveness.
In response the Italian Ambassador noted that Italy is
currently engaged in bilateral negotiations regarding
donations and the consideration of a soft loan package to
Iraq. The EC Ambassador indicated the EC is working with
member States to see what support it could offer Iraq. The
Japanese Ambassador commented, &when invited, you come with
something,8 and noted that Tokyo is &doing its homework8
regarding what commitments it will bring to the table. The
Prime Minister announced a $1.6B soft loan package from Japan
to improve oil export facilities, electrical generation and
refurbishment of oil refineries; he noted that it is the
first of its kind and hopes many more will follow.

---------------------------------------------
Political, Security and Economic Connectivity
---------------------------------------------

4. (SBU) Several Ambassadors (Italy, the European
Presidency, and A/UN) noted the strong relationship between
the political, security, and economic strands in the
document; Prime Minister al-Maliki reinforced this message.
KHALILZAD

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