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Cablegate: Oecd -- Guidance Request -- Establishing Oecd Support Unit

VZCZCXYZ0014
OO RUEHWEB

DE RUEHFR #2939/01 1871551
ZNR UUUUU ZZH
O 061551Z JUL 07
FM AMEMBASSY PARIS
TO RUEHC/SECSTATE WASHDC IMMEDIATE 8796
INFO RUEHRL/AMEMBASSY BERLIN 6623
RUEHBJ/AMEMBASSY BEIJING 1519
RUEHBR/AMEMBASSY BRASILIA 1919
RUEHNE/AMEMBASSY NEW DELHI 1130
RUEHJA/AMEMBASSY JAKARTA 0637
RUEHLO/AMEMBASSY LONDON 6610
RUEHME/AMEMBASSY MEXICO 0437
RUEHMO/AMEMBASSY MOSCOW 5912
RUEHOT/AMEMBASSY OTTAWA 2135
RUEHSA/AMEMBASSY PRETORIA 1370
RUEHRO/AMEMBASSY ROME 8460
RUEHKO/AMEMBASSY TOKYO 2534

UNCLAS PARIS 002939

SIPDIS

SENSITIVE
SIPDIS

FROM USOECD PARIS

STATE FOR E, EEB-DAN SULLIVAN, EUR AND S/P, NSC FOR STEVE NEWHOUSE

E.O. 12958: N/A
TAGS: EAID ECON ETRD OECD
SUBJECT: OECD -- GUIDANCE REQUEST -- ESTABLISHING OECD SUPPORT UNIT
FOR G-8 HEILIGENDAMM DIALOGUE PROCESS

1. (SBU) Summary. On July 12 Council will be asked to take a
decision on establishing a Support Unit for the Heiligendamm
Dialogue Process (HDP) agreed at the G-8 Summit. Although the
Germans, as G-8 President, are pushing for a quick decision in order
to initiate the process in the fall, they have been unable to
provide many details of their proposal up to this point. The
Council discussion document, C(2007)88 (draft sent to EUR/ERA and
EEB/PAPD on July 5), provides only the most general overview of the
initiative and was circulated just at the limit of the minimum
required seven days prior to Council discussion. Several OECD
members have raised questions regarding the role of the OECD (and
all its members) and the relationship between the Heiligendamm
Dialogue Process and the OECD's program of Enhanced Engagement. A
number of its proposed elements, from staffing and funding to
OECD/IEA dynamics, are potential areas of concern for the USG. U.S.
Mission requests guidance for the preliminary July 1O Executive
Committee and July 12 Council discussion. End Summary

2. (SBU) At last month's (June 12) Council meeting, SG Gurria and
German Ambassador Hoffman reported on the results of the G-8 Summit
at Heiligendamm, notably the Summit Declaration's call for the
establishment of a Support Unit to facilitate dialogue between the
G-8 and the O-5 emerging economy, outreach countries (Brazil, China,
India, Mexico and South Africa). The SG noted that the G-8 request
that the OECD host the Support Unit was an opportunity for the
Organization to have an impact in terms of policy making on global
issues. Ambassador Hoffman announced that the German government
would fully fund -- and head -- the unit. He said that German
Sherpa and chair of the ECSS, Bernd Pfaffenbach, would inform his
ECSS counterparts about details of the Support Unit. In the
interim, Pfaffenbach has sent a letter to G-8 members and O-5
countries asking them to engage with the OECD Secretary General in
support of the initiative and that the Council be prepared to
approve setting up the unit at its next meeting on July 12, so that
the unit could begin operation in September. A brief discussion
ensued, with a number of ambassadors questioning the initiative and
generally indicating their reservations.

3. (SBU) On July 5, Heads of Delegation took up the HP briefly and
considered an advance draft of the document C(2007)88 to be
discussed at the decisive July 12 Council. All the G-7 (with the
exception of a silent Canada) spoke in support. Questions that OECD
ambassadors had raised in the June 12 Council had evidently received
satisfactory responses from the Germans, but some outstanding issues
remain. These notably involve the relationship of the initiative to
the OECD's Enhanced Engagement initiative launched at the May
Ministeral, the composition of the steering group (non-G-8 countries
urging opening up membership beyond the thirteen), the curious
geometry of housing the HDP at the OECD, where one G-8 member has
not acceded, one of the O-5 (Mexico) is an OECD member, and the lack
of mention of Indonesia, the "missing" country specified in May for
enhanced engagement.

4. (SBU) The SG and Germans (the German Ambassador and a
representative from Berlin responsible for Heiligendamm who briefed
OECD Heads of Delegation) responded, indicating the HDP's structure
would likely parallel that of the Africa Partnership Forum (APF)
Support Unit (a similar undertaking established in the wake of
Gleneagles). The Germans noted that the initiative had a two-year
notional time horizon and that Germany and the next two G-8
presidents, Japan and Italy, would thus provide the funding for the
Support Unit. The SG added (as the Germans had earlier asserted)
that staffing, at least at the unit's senior levels, would be
restricted to these three countries' nationals. With these
clarifications, there appeared to be no further opposition to the
establishment of the support unit. We thus expect the July 10
Executive Committee and July 12 Council meetings will result in the
Unit's establishment.

5. (SBU) The Mission is concerned that the Heiligendamm Dialogue
Process Support Unit's work program, staffing and funding are
not/not well defined enough that we could recommend supporting it.
There are already divisions within the OECD over the role that the
International Energy Agency (IEA) will play (e.g., the extent to
which the HDP work is continuous with that of Gleneagles? and how

much of the HDP's funding pledge can the IEA lay claim to?) and the
restrictions on the staffing, which are a new departure for this
kind of OECD undertaking.

6. (SBU) Guidance Request: That said, given the fact that all G-8
leaders signed on to the concept of the HDP, we are reluctant to
take the lead in questioning the initiative at this stage. Due to
the fast track nature of the German push for a quick decision, any
apparent U.S. opposition could be seen as back-tracking on the
Summit Declaration and could be perceived as a U.S.-German
disagreement. The USG is also pushing for a July 12 Council
decision on establishing an OECD home for the advisory unit of the
Partnership for Democratic Governance. USOECD requests guidance on
how to proceed at the July 10 Executive Committee discussion and
July 12 Council discussion/decision.

Morella

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