07MOSCOW3893, RUSSIA’S FINANCE MINISTRY ON IRAQ DEBT AND AUGUST

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Reference ID Created Released Classification Origin
07MOSCOW3893 2007-08-09 05:40 2011-08-30 01:44 UNCLASSIFIED Embassy Moscow

VZCZCXRO5442
PP RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUEHMO #3893 2210540
ZNR UUUUU ZZH
P 090540Z AUG 07
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC PRIORITY 2786
INFO RUCNRAQ/IRAQ COLLECTIVE PRIORITY
RUEHGB/AMEMBASSY BAGHDAD PRIORITY 0185
RUEHFR/AMEMBASSY PARIS PRIORITY 1831
RHEHAAA/WHITE HOUSE WASHDC PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RHEBAAA/DEPT OF ENERGY WASHDC PRIORITY

UNCLAS MOSCOW 003893 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON EINV ENRD EPET IZ RS
SUBJECT: RUSSIA'S FINANCE MINISTRY ON IRAQ DEBT AND AUGUST 
9 VISIT OF IRAQ OIL MINISTER - CORRECTED VERSION 
 
REF: A. MOSCOW 3891 
     B. BAGHDAD 2616 
     C. STATE 107186 
     D. MOSCOW 3433 
 
1. (S) Deputy Finance Minister Storchak confirmed with the 
Embassy that Iraqi Oil Minister Shahrastani will visit Moscow 
on August 9 to discuss "commercial cooperation" between the 
two countries.  Storchak said FinMin Kudrin and officials in 
the Presidential Administration have pressed upon their GOR 
counterparts not to demand nor expect commercial contracts 
out of these discussions.  Nonetheless, Storchak said that 
the conversations between Sharastani and Russian Minister for 
Industry and Energy (MIE) Khristenko must be "fruitful and 
productive" to establish the proper framework for a debt 
agreement. FinMin Kudrin has limited ability to muster the 
consensus needed if Khristenko is not satisfied, Storchak 
commented. 
 
2. (S) Storchak said he was privy to internal GOR discussions 
during which it was agreed that it would be of great 
importance for Shahrastani to meet with Lukoil.  The GOR 
understands that the Iraqis are not yet prepared to discuss 
the West Quarna oil concession, but a meeting with Lukoil 
would demonstrate the seriousness by which the Iraqis see 
Russian investment as a real possibility.  It would also 
serve to recognize Lukoil's "special" status in Iraq. Lukoil, 
Storchak maintained, should also be acknowledged for its 
philanthropic work, such as the training it provides for 
Iraqi engineers in its oil and gas institute. 
 
3. (S) While acknowledging once again that there can be no 
explicit link between commercial deals and a debt agreement, 
Storchak also argued that it would be useful if the Iraqis, 
either during Shahrastani's visit or afterwards, would 
consider following the Afghan government's example.  The 
GOA's Finance Minister, during the August 6th debt signing 
ceremony, also signed with the GOR a Memorandum of 
Understanding that mentioned "commercial spheres of mutual 
interest", including in such sectors as transport and 
infrastructure, and that Russian companies would be welcome 
to compete in the open tender process. He also said that the 
atmospherics were greatly improved by Ahad's announcement of 
Russian Technopromexport win of a tender for a USD 30 million 
power station modernization project. While this was a 
business-to-business deal, it underscored Afghanistan's 
openness to Russian investment, he commented. 
 
4. (S) Storchak agreed to meet with the Embassy next week to 
discuss the Russian reaction to Shahrastani's visit and 
whether the timing is - or would soon be right - for Iraq 
Finance Minister Jabr to travel to Russia to sign a debt 
agreement. He confirmed that all the technical details of the 
debt agreement are concluded. 
 
DPRK Debt 
 
5. (S) Taking advantage of the meeting, Storchak reiterated 
the GOR's request to have U.S. "moral approval" for it to 
begin debt negotiations with the DPRK.  Storchak made the 
same request to Treasury DepSec Kimmitt during last week's 
APEC meeting, and to State U/S Jeffery during the latter's 
July 16-18th visit to Moscow.  He said the GOR has proposed 
the fall for talks, and noted that the DPRK already has sent 
delegations to Moscow twice this year for informal 
discussions. The next round will likely be held in Pyongyang. 
 
Comment: 
------- 
 
6. (S) The agreement with Afghanistan, after months of delays 
and negotiations, should be welcomed.  That said, the add-ons 
to the agreement, while just promises, could set the bar 
higher for an agreement with Iraq. The GOR got the political 
cover necessary from Afghanistan to seal the deal. They will 
likely expect no less from Iraq. 
RUSSELL

Wikileaks

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