Cablegate: Description of International Compact Agreed Upon
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OO RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUEHGB #2350/01 1851937
ZNR UUUUU ZZH
O 041937Z JUL 06
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC IMMEDIATE 5512
RUEATRS/DEPT OF TREASURY WASHDC IMMEDIATE
INFO RUCNDT/USMISSION USUN NEW YORK PRIORITY 0497
RHEHAAA/WHITE HOUSE WASHINGTON DC PRIORITY
RUCNRAQ/IRAQ COLLECTIVE
RUEKJCS/SECDEF WASHINGTON DC
UNCLAS SECTION 01 OF 03 BAGHDAD 002350
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SENSITIVE
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NSC FOR HADLEY, TREASURY FOR RKIMMITT
E.O. 12958: N/A
TAGS: ECON EAID EINV PGOV PREL IZ
SUBJECT: DESCRIPTION OF INTERNATIONAL COMPACT AGREED UPON
IN BAGHDAD
(SBU) On July 4, the following description of the
International Compact was agreed upon in Baghdad by the GOI
(DPM Barham Salih), the UN (Special Representative of the
Secretary-General Ashraf Qazi), and Embassy Baghdad for use
SIPDIS
with the invitations to the Compact launch event to take
place later this month (date TBD).
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The International Compact for Iraq:
A Shared Vision, A Shared Commitment
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The International Compact is an initiative of the Government
of Iraq for a new partnership with the international
community. Its purpose is to achieve a National Vision for
Iraq which aims to consolidate peace and pursue political,
economic and social development over the next five years.
The primary focus will be to build a framework for Iraq's
economic transformation and integration into the regional and
global economy. However, it is recognized that good
governance and resolution of security and political
challenges are pre-requisites for progress in all other
areas, including economic revival and normalization.
The Compact will aim to build on the achievements of the
Iraqi people and Government as envisaged by Security Council
Resolution 1546, including the holding of two national
elections; the drafting and adoption - through a national
referendum - of a permanent constitution; the convening of
the elected Council of Representatives and formation of a
government of national unity.
Through the Compact the Government and the international
community will be committed to achieving a range of policy
objectives in support of the National Vision. Similarly, the
Compact will take account of several initiatives and measures
for enhancing security and economic revival, chiefly the
National Reconciliation Plan.
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A Commitment to the Strategies,
Plans and Investments That Will
Realize This Vision
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The Compact will be based on a shared commitment to the
National Vision for Iraq and to the national objectives that
support it. With respect to socio-economic development these
objectives will be achieved through implementation of Iraq's
National Development Strategy. Therefore, the Compact will
also be based on shared commitment to iterative and
consultative development and implementation of the National
Development Strategy, to underlying sector-by-sector
strategies, and to the action and investment plans that will
be defined by these strategies.
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A Mechanism to Ensure
These Commitments Are Met
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The Compact will be implemented via a consultative group
process, around a commonly understood fiscal framework
against which substantive commitments will be made. As part
of this process, progress will be measured in terms of
achievement of key strategic benchmarks.
A follow-up mechanism will also be devised to coordinate
pledges, trust funds and disbursement of capital in support
of the Compact. In particular, existing pledges from the
Madrid Conference and the IRFFI will require consideration.
The Government of Iraq is supportive of IRFFI being refocused
to augment the Compact.
This mechanism should draw on lessons learned from the
experience of creating and operating the IRFFI. A central
principle is that where possible, assistance should be
channeled through the Government budget. The private sector's
potential contribution to Iraq's development needs should
also be considered.
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International and
Regional Partnership
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The Government recognizes the importance of regional
relationships in support of Iraq's development. Regional
cooperation must therefore underpin the international
partnership that will be formed by the Compact.
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Scope
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The scope of the Compact would be to achieve both near- and
long-term economic goals. These will address immediate needs,
but also, through a process of meeting commitments to reform
and restructuring, move Iraq along an evolutionary path away
from aid receipt to financial self-sufficiency, economic
development and growth.
The scope of the Compact will also, necessarily, need to
consider links with Iraq's security and political challenges.
In particular the significant fiscal implications of the
security issue will need to be considered within the context
of Iraq's economic development.
Initiatives to address near and long term economic goals
would be underpinned by a fiscal framework covering the full
program period, likely to span 5 years - equivalent to the
electoral mandate period of the current government.
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Linked to Political and
Security Considerations
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This partnership will be based on a shared recognition that
repairing the social fabric of Iraq will be essential for
success. This will depend on good governance, improving
security environment and the provision of basic services;
strengthening dialogue, reconciliation and inclusiveness; the
development of national and local political, social and civil
society institutions; and effective human rights protection
and rule of law systems that are in accordance with
international norms. Collectively they represent the sine qua
non for sustainable progress towards realizing the objectives
of the Compact. Consequently, periodic coordination meetings
will be held to monitor progress in the political and
security situation and to formulate supporting programs in
these critical areas.
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Multilateral Support
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The United Nations will play a central and impartial role in
coordinating and monitoring implementation of the Compact
agenda. In conjunction with the World Bank it will provide
Iraq with expert assistance in formulating its objectives
drawing, in particular, on the Millennium Development Goals.
The result will be a joint plan to support the efforts of the
Government to achieve internationally supported goals.
The Compact is intended to be a statement of strong regional
and international support for the political and economic
vision of the elected government of Iraq underscored by
specific financial commitments. Accordingly, the pledging of
assistance for the reconstruction and development plans of
the Iraqi government would be welcomed as an important
support for meeting agreed and measurable benchmarks for the
disbursement of assistance.
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Formulation of the Compact
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The completed Compact document would be presented by the
Government of Iraq at a high-level event in Iraq or the
region by NLT than November 2006. In September, ministerial
meetings should be convened during the UNGA in New York and
the IMF-WB annual meeting in Singapore to report progress on
the compact and mobilize support for it.
At this time, the strategies, action and investment plans
will be presented. These will be implemented and further
BAGHDAD 00002350 003 OF 003
developed via an iterative process spanning the planning
period of the Compact to 2011.
Formulation of the Compact will take place around
comprehensive national consultations to assess needs and
pathways at Governorate and National levels. Similarly,
planning will be based on current and projected capacity at
all levels of government.
In this capacity, the UN been invited to co-chair a
Preparatory Group. In addition, the World Bank, which is
planning to strengthen its presence in Baghdad, will act as a
counterpart to assist and support the government to
successfully develop a fiscal framework based on the Compact.
The Bank will also work closely with the UN in supporting the
Iraqi Government to formulate the National Vision for Iraq.
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Preparatory Group
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A Preparatory Group will provide strategic advice and
engender high level political support to the Compact. The
Preparatory Group would negotiate an executive timetable and
assume responsibility for the Compact preparations including
support to the Government of Iraq in development of action
and investment plans and commitments that it would make
through the Compact. It will also advise the Government of
Iraq on follow-up mechanisms, as invited.
The Preparatory Group would be co-chaired by the Government
of Iraq and the UN, substantively supported by the World Bank
and UNDP, closely coordinated with the IMF and other
international financial institutions. It will report directly
to the Deputy Prime Minister of Iraq and the Deputy
Secretary-General of the United Nations.
SIPDIS
Membership of the Preparatory Group should, as far as
possible, adhere to a principle of "wide but restricted"
participation to maintain a balance between inclusiveness and
operational efficiency. Accordingly, it would initially be
open to significant contributors to Iraq's development and
technical partners, namely: UN, World Bank, IMF, EC, Arab
Development Fund, Islamic Development Bank, France, Germany,
Italy, Japan, Kuwait, Saudi Arabia, South Korea, Spain, UAE,
UK, and US. In addition, the Preparatory Group would invite
the IRFFI Chair to participate in order to ensure proper
coordination between the Compact and IRFFI trust funds. The
Co-Chairs will designate a small steering group to assist the
Preparatory Group in establishing a timetable, guiding
negotiations and overseeing implementation, including the
role of monitoring and evaluation against benchmarks once the
Compact is launched.
Further membership of the Preparatory Group would be
determined by due consultation.
END TEXT.
Khalilzad