Maravi

(WIKILEAKS CABLES) AMBASSADOR HEARS CRICKETS IN MEETING WITH FINANCE MINISTER

SUBJECT: AMBASSADOR HEARS CRICKETS IN MEETING WITH FINANCE MINISTER
Classified By: Charge d'Affaires Michael Koplovsky for reasons 1.4(d)

Summary
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¶1. (C) In a January 15 meeting with Minister of Finance Situmbeko Musokotwane, the Ambassador highlighted the progress Zambia made in 2009 towards a Millennium Challenge Account (MCA) compact (Ref. A), but stressed that the Zambian government (GRZ) must act now to assuage concerns about the GRZ's commitment to good governanceand anti-corruption efforts to ensure Zambia's continued compact qualification.

He noted that similar concerns contributed to a re-evaluation of Zambia's inclusion in the Global Financial Crisis Initiative (GFCI), during which Zambia was found to be ineligible for economic reasons. The Ambassador congratulated the Minister on the January 4 launch of the GRZ's integrated financial management and information system (IFMIS), and urged the Minister to continue improving the GRZ's public financial management capacity. Finally, the Ambassador asked that the GRZ help to develop a substantive, high-level policy agenda for the Cooperating Partners Group (CPG) -- the United States will chair the CPG for the next six months. While the governance concerns are not new to Musokotwane, he had little to say in response to any of the topics raised by the Ambassador, and raised no topics
himself. End Summary.

Ambassador's Message
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¶2. (C) In a January 15 meeting with Situmbeko Musokotwane, Minister of Finance and National Planning, the Ambassador highlighted the tremendous progress Zambia made in 2009 towards an MCA compact. He cautioned Musokotwane that during discussions that led to Zambia's compact eligibility re-selection, the Millennium Challenge Corporation (MCC) board expressed concerns about the GRZ's commitment to good governance, anti-corruption efforts and freedom of speech and expression, essential to Zambia's continued qualification for a compact. The Ambassador noted that the board's concerns were serious enough that MCC CEO Daniel Yohannes mentioned them specifically in his January 4 letter to President Banda.

¶3. (C) The Ambassador stressed that the GRZ had time to address the MCC's (and broader USG) concerns about its commitment to good governance and anti-corruption efforts, but said that the GRZ must not wait to take action. He listed several steps the GRZ could take, including strengthening the Anti-Corruption Commission, creating a dialogue with Civil Society Organizations (CSO), including CSOs critical of the current administration, and continuing to work with media associations on self-regulatory structures to avoid restrictive government regulation of the media.
While conceding that the GRZ was unlikely to win all CSO hearts and minds, the Ambassador stressed that communication with CSOs would be a positive step, and engagement could mean reassurance that the GRZ was committed to transparent and
open governance to some local organizations that provide input into indicators used by the MCC.

¶4. (C) The Ambassador also noted that in 2009 Zambia was considered for up to USD 25 million in assistance under the Global Financial Crisis Initiative (GFCI). When similar concerns about governance and corruption caused the USG to re-evaluate Zambia's inclusion in GFCI, however, Zambia was deemed ineligible based on its relatively positive economic performance.

¶5. (C) Turning to budget transparency and public financial management, the Ambassador congratulated the Minister on the January 4 launch of IFMIS at the Ministry of Finance and National Planning. While noting the good progress that Zambia
has made, the Ambassador urged the Minister to continue improving the GRZ's financial management capacity by rolling out IFMIS to all ministries and adopting a treasury single account, and to pass a Freedom of Information Act to increase
government transparency in general (Ref. B). The Ambassador explained the requirements for some countries to receive a waiver to allow continued U.S. assistance if their budget development and execution was not considered transparent, and noted that, while Zambia received a waiver for FY2009, it was not yet known whether a FY2010 waiver was required for continued assistance.

¶6. (C) Finally, the Ambassador asked the Minister what the GRZ would like to accomplish with the Coordinating Partners Group (CPG) during the six months that the United States would chair the group. The Ambassador noted that the CPG agenda had been dominated by governance issues, and more generally by issues determined by cooperating partners. To be an effective forum for dialogue, the CPG should be more
balanced to focus on high-level policy discussions and not just focused on trouble-shooting.

Minister's Limited Response
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¶7. (C) If the GRZ is engaged in a charm offensive with the United States, Musokotwane did not get the memo (Ref. C). He was his usual taciturn self, and sat silently to, in his words, "hear his sins" throughout much of the meeting. The
Minister had little to say in response to the MCC board governance concerns, which were not new to him, and replied that it was "fair" that Zambia did not receive GFCI funding because its economy did bounce back quickly. Musokotwane asked for a list of the African countries that could potentially need budget transparency waivers to receive U.S. assistance, and asked that the Ambassador "drop him a note" about upcoming CPG agendas so that he could consult with his colleagues.

KOPLOVSKY

Labels: CORRUPTION, SITUMBEKO MUSOKOTWANE, WIKILEAKS CABLES

posted by MrK @ 5:11 PM