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Cablegate: Finance Minister Jabr: Mof Resuming Activity

VZCZCXRO4450
PP RUEHBC RUEHDA RUEHDE RUEHDH RUEHIHL RUEHKUK
DE RUEHGB #2337/01 2421332
ZNR UUUUU ZZH
P 301332Z AUG 09
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC PRIORITY 4512
INFO RUCNRAQ/IRAQ COLLECTIVE PRIORITY

UNCLAS SECTION 01 OF 02 BAGHDAD 002337

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ECON EFIN EPET IZ PGOV PREL
SUBJECT: FINANCE MINISTER JABR: MOF RESUMING ACTIVITY

Summary

1. (SBU) During an August 26 meeting with Ambassador Haslach,
Finance Minister Jabr made special note of his good
relationship with former deputy PM and KRG PM Barham Salih.
Ambassador Haslach delivered condolence letters from
Ambassador Hill and Department of Treasury Acting Assistant
Secretary Baukol to Jabr and offered USG help in the
aftermath of the August 19 bombings. The Minister confirmed
that he will attend the October investment conference in
Washington and that work is progressing on an IMF Stand-By
Arrangement and possible additional budget support from the
World Bank. Ambassador Haslach welcomed the issuance of a
T-bill to help fund the GE contract, noting that this will
send a positive signal to potential investors. End summary.

Optimism on Revenue Sharing

2. (SBU) While the meeting was dominated by discussion of the
upcoming investment conference and the aftermath of the
Finance Ministry bombing, Jabr did note in response to a
question from Ambassador Haslach that he had a positive
relationship with KRG PM Salih. Without sharing specifics,
Jabr said that his good relationship with Salih left him
optimistic about the chances of reaching a compromise on oil
revenue sharing. &We will find solutions,8 Jabr emphasized.

MOF Damaged, but Resuming Activities

3. (U) The Minister thanked Ambassador Haslach for the USG
offer of assistance, as well as those of other governments,
citing Germany, Spain, and UAE offers to care for the
seriously injured. He recounted that 256 people had been
hospitalized with injuries, 10-12 of whom were in serious
condition. Eight bodies had been found in the rubble and two
victims had died in the hospital.

4. (U) The Minister reported that the MoF main building was
no longer usable. He was confident, however, that the Budget
and the Accounting Departments, the &heart of the
government,8 would be resuming operations by the end of the
week in new locations. &Terrorists bombs cannot stop the
life of the Iraqis.8 He did not have any specific
assistance requests of the USG, but being an engineer
himself, he knew that Iraq does not have many experts who
could assess the damaged building to ascertain whether it
could be rehabilitated. He said that he would follow up if
he had any specific requests for assistance.

Investment Conference and DEC: Minister to Attend

5. (SBU) The Minister reported that he would attend the
U.S.-Iraq investment conference in Washington in October.
The Prime Minister, according to his information, would not
lead the delegation. The former Deputy Prime Minister (DPM)
and newly named KRG Prime Minister, Barham Salih, would
likely lead the delegation, according to the Minister.
Explaining that he had not been active in the US-Iraq
Dialogue for Economic Cooperation (DEC), the Minister said he
would be more active in the October 19 DEC meeting. The head
of the DEC delegation has not yet been decided. Barham Salih
chaired the Iraqi delegation when he was the DPM.

IMF and World Bank: Work Continues on Possible Budget Support

6. (U) The Minister confirmed that work on a Stand-By
Arrangement with the IMF is continuing. In addition, the
Minister has sent a letter to the World Bank seeking
additional budget support to supplement the IMF program.
Jabr said he would travel to Istanbul in early October to
attend the IMF/World Bank Annual Meeting. He expects to
discuss these programs with the Fund and Bank and hopes to
meet with US Treasury officials.

General Electric

7. (U) Ambassador Haslach expressed appreciation for the
MoF,s authorization of a T-bill valued at USD 2.4 billion to
QMoF,s authorization of a T-bill valued at USD 2.4 billion to
pay General Electric. This will send a positive signal to
investors when they gather for the conference in Washington,
she said.

8. (U) The Minister noted that the authorization document had
signed had been lost in the post-bombing rubble, but his
staff eventually found it and sent it to the Central Bank.
(Note: the Deputy Governor of the Central Bank confirmed that
the T-bill has been issued with the funds placed on the
MoF,s account. These funds are to be used by the Ministry of
Electricity. End note).

Comment

BAGHDAD 00002337 002 OF 002

9. (SBU) By the Minister,s own account, his friendship with
Barham Salih is solid, although we are uncertain whether
Salih shares this sentiment. When Salih knew he would be
away from Baghdad to join the election campaign in the KRG,
Salih asked Jabr to chair the High Economic Committee and to
assume responsibility for preparing for a ministerial meeting
on the International Compact with Iraq. In a previous
meeting with Ambassador Hill, Jabr thought that it would be a
good signal if Barham, as the Prime Minister of the KRG, were
to lead the GOI delegation to the Washington investment
conference. If the Minister is correct that the good
relationship will remain intact, it could auger well for
resolving some of Iraq,s more nettlesome internal issues
with the KRG. At the national level, it also speaks to the
longstanding relationship between the Kurds and Islamic
Supreme Council of Iraq (ISCI).
HILL

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