id: 248981
date: 2/16/2010 14:09
refid: 10TUNIS113
origin: Embassy Tunis
classification: CONFIDENTIAL
destination: 10TUNIS66
header:
VZCZCXYZ0001
PP RUEHWEB
DE RUEHTU #0113/01 0471409
ZNY CCCCC ZZH
P 161409Z FEB 10
FM AMEMBASSY TUNIS
TO RUEHC/SECSTATE WASHDC PRIORITY 7291
INFO RUCNMGH/MAGHREB COLLECTIVE
RUEWMFD/USAFRICOM STUTTGART GE
RUEKJCS/SECDEF WASHINGTON DC
RHEHNSC/NSC WASHDC
C O N F I D E N T I A L TUNIS 000113
SIPDIS
E.O. 12958: DECL: 01/28/2020
TAGS: PREL, PGOV, PHUM, KTIP, TS
SUBJECT: SENIOR GOT OFFICIAL CALLS FOR "NEW PAGE" IN
U.S.-TUNISIA RELATIONS
REF: TUNIS 66
Classified by Ambassador Gordon Gray for reasons 1.4 (b) and (d).
1. (C) Summary: Saida Chtoui, one of two de facto deputy ministers in Tunisia's Ministry of Foreign Affairs, told visiting DAS Sanderson on January 26 that the U.S. and Tunisia "have a lot of work to do together," that Tunisia's new Foreign Minister is "open minded," and that Tunisia wants to "build stronger political relations" with the U.S. Chtoui maintained that Tunisia was striving to find the right balance among security, development, and democratic process, and insisted Tunisia deserved more credit for its social achievements. Responding to DAS Sanderson's expression of concern about human rights and a recent crackdown against independent journalism, Chtoui dismissed dissident journalists as poseurs and profiteers and complained, relatively mildly, about Tunisia's mention in the Secretary's January 21 speech on Internet freedom. This prompted a spirited exchange on freedom of expression, in which Chtoui linked moves in the U.S. to ban Al-Manar TV to Tunisia's censorship of "dangerous" websites. The Ambassador openly wondered what threat was posed by sites such as Freedom House. At the close of what remained throughout a friendly discussion, Chtoui pledged Tunisia's full support for U.S. efforts to revive Middle East peace talks (reftel). End summary.
2. (C) DAS Sanderson met for one hour on January 26 with Saida Chtoui, the veteran Tunisian diplomat now serving as Secretary of State for Asia and the Americas (Deputy Minister equivalent) at the conclusion of her January 25-27 visit to Tunis. Chtoui rolled out a rhetorical red carpet for her guest, opening the meeting with the declaration that Tunisia seeks "stronger political ties" and would like to "open a new page" with the U.S. Indicating Tunisia would welcome more high level USG visits, Chtoui asked about "her friend" Assistant Secretary Feltman, and noted that President Ben Ali holds Under Secretary Burns in very high regard and "really enjoys talking with him.... Our new Foreign Minister is very open minded," Chtoui continued, "...there is much work we can do together. We feel positive change with the arrival of the new U.S. Ambassador. Things are changing and moving forward."
--------------------------------------------- --
Sanderson: Need for Candid, Substantive Dialogue
--------------------------------------------- --
3. (C) Welcoming the positive tone of Chtoui's opening remarks, DAS Sanderson observed that, as longtime friends, the U.S. and Tunisia should not hesitate to speak frankly about differences of opinion, which are normal in any relationship. "There are no taboos," Chtoui replied; we are ready to work together. DAS Sanderson said the U.S. was concerned about human rights in Tunisia, and particularly recent actions against independent journalists that raised doubts about the freedom of the press. We would also like to discuss the issue of trafficking in persons, and we are hoping the GOT will follow though on its committment to arrange a meeting for the Embassy with the designated point of contact in the Ministry of Justice, DAS Sanderson added.
4. (C) Reprising a familiar theme, Chtoui said the GOT had two years ago made a great effort to provide the U.S. with a comprehensive dossier of information about the Tunisia's legal framework and protections concerning TIP, but that none of this was factored into the final report. This ommission was demoralizing to the GOT, Chtoui asserted. (Note: In fact, much of the GOT's information on laws that could be used to prosecute human traffickers was incorporated into the Embassy's submission to the Department on TIP. End note.) The GOT was nonetheless willing to take up the subject again with the USG, "provided there is a prospect for change," Chtoui allowed.
5. (C) The USG places a high premium on the accuracy of its reports, DAS Sanderson underlined, and it is for this reason we would like to have candid, substantive dialogue with the GOT - on TIP, and on broader human rights topics. This is an opportunity for the GOT to clarify its views and actions, DAS Sanderson added.
--------------------
Dissidents as Poseurs
--------------------
6. (C) "We know we are not perfect," Chtoui responded, but the U.S. should not take all the anti-GOT criticism it hears at face value. She questioned the credentials of Taoufik Ben Brik (a journalist jailed in November) and activist Sihem Bensidrine (a high profile dissident perennially clashing with the GOT), claiming they were much better at posing for international sympathizers than in actually practicing their trades. However well-known and popular they may be abroad, in Tunisia "no one is above the law," Chtoui insisted.
7. (C) The small minority of GOT critics who get so much international attention do not represent the views of most Tunisians, who benefit from living in a country where 80 percent of the citizens are middle class, Chtoui claimed.
Tunisians enjoy a better standard of living than either Algerians or Libyans, even though each country is considerably richer in resources. Tunisia is taking extraordinary steps to generate jobs for its university graduates, even sharing payroll costs with employers in some cases. Poverty rates in Tunisia are more comparable to countries in Europe than to countries in Africa, Chtoui insisted.
---------------
Internet Freedom
---------------
8. (C) We expect candid discussions with the USG, but demonizing Tunisia is not fair, Chtoui emphasized. There may be room for improvement, but the subject of human rights in Tunisia "is not a disaster." Mentioning Tunisia as one of the worst countries in the world for Internet freedom does not seem fair, Chtoui continued. Tunisia was one of the first countries in either Africa or the Arab world to encourage the growth of Internet use. "Where does the truth really lie?" Chtoui asked rhetorically. Tunisia is situated in the middle of a dangerous region, Chtoui declared, and had a duty to take security precautions. Tunisia is struggling to find the right balance between security, economic development, and democratic freedoms, she asserted.
9. (C) "Finding the right balance is an ongoing, difficult process," DAS Sanderson allowed. "As leaders and citizens, we need to weigh how much we are giving up," as we make security decisions, she added. The U.S. learned, following September 11, that too many controls can be counterproductive, DAS Sanderson observed. If the GOT feels the Secretary's remarks about the Internet were not accurate, we should talk about it, DAS Sanderson underlined, "our concern is that Tunisia's admirable progress in some areas could be undermined by its lack of progress in other areas."
10. (C) Chtoui rejected the notion that freedom of expression does not exist in Tunisia. Several licensed Arabic language newspapers, such as those belonging to the former communist party (Al-Tajdid), receive GOT subsidies, even as they regularly level criticism at the government. At the same time, "we fully understand," Chtoui asserted, U.S. moves to ban the broadcasts of Hezbollah-controlled Al-Manar TV, which it considers incitement. For the same reason, Tunisia needs to take action to block sites that incite hatred and threaten stability, she maintained. "Even in the U.S., freedom of speech is not absolute," the Ambassador interjected, "you can't yell 'fire' in the middle of a crowded movie house.
But it is difficult to see what particular security threat is posed to Tunisia by Freedom House's website. There should be a place for mainstream criticism," the Ambassador underscored.
11. (C) "Freedom House does not have a balanced attitude.
They are very biased and only listen to Tunisia's critics.
They don't listen to those who point out our achievements," Chtoui replied. "I hate Al-Jazeera (whose site is also blocked in Tunisia). They just destroy people day and night in a hateful dialogue, if we can call it dialogue." The Ambassador said the USG distinguishes between Al-Jazeera, which is often biased, and Al-Manar, which is the arm of a terrorist group. There is a difference between journalistic bias and incitement to violence, the Ambassador stressed.
12. (C) Wrapping up the conversation, DAS Sanderson and the Ambassdor emphasized that the U.S. would like to engage in a sustained, practical, non-adversarial dialogue with Tunisia, and would like to move forward various items on the bilateral agenda, including a resumption of TIFA talks and the conclusion of an open skies agreement. Chtoui said the GOT welcomed these efforts, adding "you can rely on my personal support."
13. (U) This message was cleared by DAS Sanderson.
GRAY
=======================CABLE ENDS===========================
]]>ID: 06TUNIS55
Created: 2006-01-09 15:03
Classification: SECRET
Origin: Embassy Tunis
S E C R E T TUNIS 000055
SIPDIS
STATE FOR NEA/MAG - LAWRENCE AND INR PARIS FOR ZEYALONDON FOR TSOUE.O. 12958: DECL: 01/04/2016
TAGS: PGOV PREL TS
SUBJECT: SUCCESSION IN TUNISIA: FINDING A SUCCESSOR OR FEET FIRST?
REF: A. 05 TUNIS 2265 B. 05 TUNIS 2148
Classified By: AMBASSADOR WILLIAM HUDSON FOR REASONS 1.5 (b) AND (d)
1. (S) SUMMARY: In a country that has had only one president for over eighteen years, suddenly and unusually, talk of the post-Ben Ali era is growing. Several senior and well-connected individuals have recently raised Ben Ali’s intentions for the future with Ambassador and other embassy officials. On the heels of Ben Ali’s recent illness (Ref A) and a new law providing for “former presidents” (Ref B), these discussions seem, on the surface, to be more relevant that the usual rumors. While we have no evidence that Ben Ali’s cancer has reached the life-threatening stage or that he is actively contemplating his retirement, there are some interesting scenarios being discussed, including the possibility that Ben Ali may groom a successor to run in the next presidential elections. Given the constitutional framework and the political scene, a successful candidate will likely come from the RCD Politburo. None of the options suggest Tunisia will become more democratic, but the US-Tunisian bilateral relationship is likely to remain unaffected by the departure of Ben Ali. END SUMMARY.
2. (S) One of the standard jokes about President Zine el Abidine Ben Ali (usually delivered only half in jest) is that he has three goals for his presidency: to stay in power; to stay in power; and to stay in power. Ample evidence supports this view, including a 2002 constitutional amendment that he and the ruling RCD (Democratic Constitutional Rally) party pushed through which eliminated the two-term limit and effectively gave him the right to govern at least until 2014. In recent months, however, increasingly concrete speculation has been voiced by well-placed contacts (and more casual observers) that Ben Ali does not plan to run again and may even step down before his term expires in 2009.
3. (S) A Cabinet-level GOT official XXXXXXXXXXXX recently told the Ambassador XXXXXXXXXXXX that Ben Ali wants to avoid the “difficulties” that arose when Tunisia’s first president, Habib Bourguiba, declined in 1987. At the time, Ben Ali argued that Bourguiba was medically unfit to continue as president, while denouncing Bourguiba’s de facto presidency for life. One way for Ben Ali to ensure a smoother transition would be to groom a replacement and present him as the only viable candidate in 2009. XXXXXXXXXXXX later told the Ambassador that, in fact, Ben Ali does not intend to run again in the 2009 presidential elections. This scenario, while hard to imagine for many who have witnessed first hand Ben Ali’s jealous control of all power in Tunisia, would allow the President to bask in the glory of being the first Arab leader to voluntarily and peacefully leave office.
4. (C) Average Tunisians spend more time commenting on Ben Ali’s health and omnipotent rule than the possibility that he may step down. Ben Ali, who has been rumored to have prostate cancer since early 2003, maintains an active schedule and appears healthy; but Tunisians often discuss whether he appears pale, thin or otherwise physically ill. While some people may state their hope that U.S. and European pressure could force Ben Ali to become more democratic or relinquish the presidency, they are at a loss when asked who would succeed him. Ben Ali’s policy of regularly changing ministers and other senior officials has ensured that no individual has widespread support, respect, or even substantial recognition among Tunisians.
THE CONSTITUTIONAL SYSTEM
5. (C) The significant constitutional changes approved in a May 2002 referendum that allow presidential candidates up to the age of seventy-five led many Tunisians to assume that Ben Ali intends to remain president for life. In Ben Ali’s case, the changes allow him to run in 2009 and serve as president until the 2014 elections, when, at age 79, he will be legally too old to run for reelection. However, many Tunisians still cynically expect Ben Ali to change the constitution again to allow him to continue to serve as president until his ultimate demise.
6. (C) The constitutional amendments of 2002 also outlined legal procedures that address presidential illness, incapacity and death. According to the constitution, in the event of a temporary incapacity, the President can delegate some of his powers to the Prime Minister. During this interim period, the PM/acting president cannot dissolve the National Assembly, nor can he make changes to the Cabinet. (Note: During Ben Ali’s four-day October illness, he did not elect to delegate any authorities. End Note.) This system replaces the previous constitutional provisions, which Ben Ali used to remove Bourguiba, in which the Prime Minister was responsible for determining the president’s incapacity based on from seven doctors’ certifications that the president was no longer competent to carry out the functions of his office.
7. (C) In the event the President dies in office, resigns or is unable to carry out his duties due to illness or other incapacity, the Constitutional Council would meet to determine if the vacancy of the office was “definitive.” (Note: The nine-member Constitutional Council, which was created in 2001 as part of the above-mentioned constitutional revisions, is generally responsible for reviewing new laws to ensure conformity with the constitution. Four members are appointed by the President, three by the President of the Chamber of Deputies, and three are members based on their government positions: the first president of the Supreme Court, the president of the Administrative Tribunal, and the President of the National Accounting Office.) An absolute majority of the Council would be required to render the presidency vacant. The Council must then advise the presidents of the Chamber of Deputies and the Chamber of Counselors, of this determination, which triggers the “immediate” but temporary investiture of the president of the Chamber of Deputies as interim president. The interim president must organize elections within 60 days, and cannot dissolve the Chamber, change the constitution, change the government, nor stand for election to the Presidency.
8. (C) Thus, under the current constitutional dispensation, if Ben Ali were to be “temporarily” incapacitated due to illness, he could turn over a measure of presidential authority to Prime Minister Mohammed Ghannouchi. Ghannouchi, an economist by training, is a respected figure in the “technocratic” mold. If Ben Ali were to die in office, resign for whatever reason, or become so ill he could no longer exercise his functions, the Constitutional Council could declare the Presidency “vacant” and interim authority would fall to Fouad Mebazaa, the current President of the National Assembly. Mebazaa is a long-time ruling RCD party stalwart (a member of the RCD Politburo, a former Minister, and a “survivor” from the Bourguiba era), whose principal task as interim President would be to organize elections and, from an RCD perspective, maintain the party’s hold on power.
WHO CAN RUN - AND BE ELECTED
9. (C) In order to be eligible to run for the presidency, a candidate must be no older than 75, be a member of a party with at least one member in parliament, and obtain the signatures of 30 deputies and/or mayors. Given the personality-cult status of the opposition parties (several of which are internally fragmented and weak) and their lack of organized platforms or significant membership, it is unlikely any opposition candidate would garner enough strength to seriously challenge an RCD member. It is most likely that the next president would come from within the RCD given its history as Tunisia’s founding party, its grass roots structure, and its interest in stability and continuity.
POSSIBLE SUCCESSORS
10. (S) Designating a successor may be the only means for Ben Ali to maintain his legacy as the man who brought “blessed change” to Tunisia. However, as he is an expert at shuffling his advisors and cabinet members to prevent any one individual from gaining sufficient political support to become a threat to the President’s rule, it is unclear who this successor might be. Given the legal framework of the presidency, it is expected that the successor would come from the RCD Politburo -- whether handpicked by Ben Ali or following his death. Possible candidates, whose bio info is provided below, include Minister of State, Special Advisor to the President and Official Spokesman Abdelaziz Ben Dhia, Minister of Social Affairs, Solidarity and Tunisians Abroad Ali Chaouch, Prime Minister Mohammed Ghannouchi, Minister of Defense Kamel Morjane and First Lady Leila Ben Ali. None of these individuals would likely make any significant changes in GOT domestic or foreign policies, at least initially.
Minister of State Ben Dhia: Ben Dhia is often mentioned as a possible successor, given his strong position in the palace. Since he was born in 1936, Ben Dhia’s age is the prime obstacle to the likelihood he would be Ben Ali’s successor, as he also would be ineligible to run in the 2014 elections. However, rumored to be equally liked by the President and First Lady, Ben Dhia could act as a placeholder while a younger family member, such as one of Ben Ali’s son-in-laws, gained political power. Ben Dhia’s long history of government service, including under Bourguiba, may give him widespread public support, although his relatively secretive responsibilities in the palace cause some consternation among average Tunisians. These same unknown responsibilities have also supported Ben Dhia’s reputation in Tunisia as an “eminence grise” - the brilliant behind-the-scenes decision maker in the palace.
Minister of Social Affairs Chaouch: Ali Chaouch (born in 1948) has held two positions that have given him great exposure to the Tunisian public: as RCD Secretary General from 2000-04, and currently as the Minister of Social Affairs. However, he also occupied the despised position of Minister of Interior, which while it may have given him the background to run a dictatorship, earned him little popularity with the Tunisian public.
Prime Minister Ghannouchi: (8/18/1941) A career technocrat and trained economist, Ghannouchi has served as Prime Minister since 1999. Ghannouchi is rumored to have told many that he wishes to leave the GOT but has not had the opportunity. The length of his service as PM also suggests that Ben Ali does not view him as a threat and that he is unlikely to be viewed as a qualified successor. However, average Tunisians generally view him with respect and he is well-liked in comparison to other GOT and RCD officials.
First Lady Ben Ali: (10/24/1956) While there are often rumors of Leila’s political ambitions, almost all observers note she does not have sufficient support among the Tunisian public. However, she cannot be ruled out as a possible successor, especially as she is widely believed to be at least partially responsible for many official appointments. If this is true, she has a wide range of political allies throughout Tunisian society that would support her -- even in the face of public disapproval.
Minister of Defense Morjane: (5/9/1945) Also affecting the credibility of succession scenarios is an oft-repeated notion that the US is favoring Morjane in the succession race. Morjane, appointed Minister of Defense in August 2005 after years of United Nations service, at one point had USG support for his candidacy to be the U.N. High Commissioner for Refugees and has been helpful as Minister. However, we know little about his personal politics or ambitions.
11. (S) COMMENT. Given the fact that Ben Ali has a dictatorial hold on Tunisia, it is hard to believe that he will voluntarily step down. We wonder that these discussions are not simply a ruse that will bring Tunisians - supporters and critics alike - out in force calling for another Ben Ali term. This would give Ben Ali the necessary cover that he is only responding to public demand for the continuation of his presidency, much as he did following the 2002 referendum that amended the constitution to allow him to run until 2014. However it is interpreted, the mere fact that an increasing number of Tunisians are talking about succession and the end of the Ben Ali era is remarkable. HUDSON
Permalink:https://tunileaks.appspot.com/?p=44001
]]>ID: 212425
Date: 2009-06-16 18:45:00
Origin: 09TUNIS372
Source: Embassy Tunis
Classification: CONFIDENTIAL//NOFORN
Dunno: 07TUNIS1489
Destination: VZCZCXRO0893
PP RUEHROV RUEHTRO
DE RUEHTU #0372/01 1671845
ZNY CCCCC ZZH
P 161845Z JUN 09 ZDK
FM AMEMBASSY TUNIS
TO RUEHC/SECSTATE WASHDC PRIORITY 6374
INFO RUEHXK/ARAB ISRAELI COLLECTIVE PRIORITY
RUCNMGH/MAGHREB COLLECTIVE PRIORITY
C O N F I D E N T I A L SECTION 01 OF 03 TUNIS 000372
NOFORN
SIPDIS
STATE FOR NEA/MAG (NARDI AND HAYES)
E.O. 12958: DECL: 06/16/2019
TAGS: PGOV, PHUM, KCOR, SOCI, PREL, TS
SUBJECT: TUNISIAN CRITICIZES REGIME IN FORTHCOMING BOOK;
SHARES ANECDOTE OF BEN ALI CORRUPTION
REF: 07 TUNIS 1489
TUNIS 00000372 001.2 OF 003
Classified By: Ambassador Robert F. Godec for reasons 1.4 (b) and (d)
-------
Summary
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1. (C) XXXXXXXXXXXX approached Ambassador and Pol/EconCouns XXXXXXXXXXXX to share with us XXXXXXXXXXXX the Ambassador gave him assurances that we would.
XXXXXXXXXXXX shared a rare first-hand account of corruption from several years ago in which Ben Ali himself was described as asking for a 50 percent stake in XXXXXXXXXXXX private university. XXXXXXXXXXXX
--------------------------------------------- ---------
XXXXXXXXXXXX The Day I Realized Tunisia is No Longer a Free Country
--------------------------------------------- ---------
2. (C) On the margins of a networking event for aspiring and successful social entrepreneurs XXXXXXXXXXXX The book is extremely critical of the Ben Ali regime for, among other things, the "duality" between official discourse and the reality on the ground. Specifically XXXXXXXXXXXX points to the "stifling" of political liberties and "omnipotent" controls on the media. He also charges that freedom of association is "illusory" and assesses that "the rule of law is more fiction than reality." XXXXXXXXXXXX
-------------------
XXXXXXXXXXXX
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3. XXXXXXXXXXXX asked that the US Embassy follow his case XXXXXXXXXXXX;
the Ambassador assured him that we would do so. Pol/EconCouns reviewed XXXXXXXXXXXX some of the accounts of life in prison that we have heard from released political prisoners; XXXXXXXXXXXX.
----------------------
Tale of Corruption I: The French Connection?
----------------------
4. (C/NF) Asked whether he had also been in touch with other western embassies, XXXXXXXXXXXX said that he had not. He had avoided reaching out to the French, in particular, arguing that Ambassador Degallaix is seen as Ben Ali's Ambassador to French President Sarkozy, not vice versa. In addition, XXXXXXXXXXXX alleged that the GOT has improperly given Ambassador Degallaix a villa, which is registered in his daughter's name, on rue Sidi Dhrif, near the President's own residence. He did not offer any evidence of this alleged corruption or explain how this knowledge came to him.
XXXXXXXXXXXX
--------------------------------------------
Tale of Corruption II: Ben Ali Seeks 50 Percent Stake XXXXXXXXXXXX
--------------------------------------------
5. (C) XXXXXXXXXXXX likened corruption to a dangerous cancer that is spreading in Tunisia, spurred on by the corrupt practices of President Ben Ali and his extended family. When Pol/EconCouns responded by noting that most tales of corruption that we hear concern "The Family" rather than the President himself, XXXXXXXXXXXX recounted an incident in which Ben Ali himself was involved. XXXXXXXXXXXX Ben Ali came off as "very uneducated" in the meeting, failing to grasp some of the key points XXXXXXXXXXXX about the virtues XXXXXXXXXXXX Ben Ali abruptly told him that he wanted a 50-50 stake in the enterprise. Fearful of responding in the negative, XXXXXXXXXXXX said he "played dumb," pretending not to understand the President's proposition.
-------------------------------
Other Run-ins with "The Family"
-------------------------------
6. (C) XXXXXXXXXXXX also reviewed the difficulties that lead to the closure XXXXXXXXXXXX
How Suha Arafat Got Into Trouble
--------------------------------
7. (C) XXXXXXXXXXXX also offered a theory as to what was behind the GOT's decision to revoke Suha Arafat's Tunisian citizenship in 2007. (Note: Reftel also reports on this incident.) He said that he had heard that Leila Ben Ali at that time had been scheming to marry off an 18 year-old niece (NFI) to UAE Prime Minister and Dubai Ruler Sheik Mohamed bin Rashid al-Maktoum, one of whose wives is the half-sister of the King of Jordan. According to this rumor, Suha Arafat warned Jordanian Queen Rania about Leila Ben Ali's plans.
Word of Arafat's intervention got back to the Tunisian First Lady, who turned against Arafat and soon forced her out of Tunisia.
---------------------
XXXXXXXXXXXX
---------------------
8. XXXXXXXXXXXX
-------
XXXXXXXXXXXX
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9. (C) XXXXXXXXXXXX is extremely well respected and considered an upstanding member of the community. While we might doubt the veracity of some of the rumors that he shared with us, we have no reason to doubt his account of his conversation with President Ben Ali, in which he described the President as seeking a 50 percent stake in his private university. We routinely hear allegations of corruption, and such allegations are inherently difficult to prove. But XXXXXXXXXXXX anecdote strikes us as credible. It is also significant in that it implicates Ben Ali himself, while so many other reported incidents of corruption involve his extended family.
10. XXXXXXXXXXXX
Please visit Embassy Tunis' Classified Website at: http://www.state.sgov.gov/p/nea/tunis/index.c fm
Godec
Permalink:https://tunileaks.appspot.com/?p=40001
]]>ID: 130475
Date: 2007-11-16 17:13:00
Origin: 07TUNIS1489
Source: Embassy Tunis
Classification: CONFIDENTIAL//NOFORN
Dunno: 06TUNIS2570
Destination: VZCZCXRO8599
PP RUEHROV
DE RUEHTU #1489/01 3201713
ZNY CCCCC ZZH
P 161713Z NOV 07
FM AMEMBASSY TUNIS
TO RUEHC/SECSTATE WASHDC PRIORITY 4109
INFO RUEHXK/ARAB ISRAELI COLLECTIVE PRIORITY
RUEHVT/AMEMBASSY VALLETTA PRIORITY 0396
C O N F I D E N T I A L SECTION 01 OF 03 TUNIS 001489
SIPDIS
NOFORN
SIPDIS
STATE FOR NEA/IPA AND NEA/MAG (HOPKINS AND HARRIS)
E.O. 12958: DECL: 11/15/2017
TAGS: PREL, PGOV, SOCI, PINR, TS
SUBJECT: THE PNG'ING OF SUHA ARAFAT: MANY RUMORS, FEW FACTS
REF: A. IIR 6 897 0136 07 (NOTALS)
B. 06 TUNIS 2570
Classified By: Ambassador Robert F. Godec for reasons 1.4 (b) and (d)
1. (C/NF) Summary: The GOT's decision last summer to revoke Suha Arafat's Tunisian citizenship, which had only been granted less than a year earlier, made international headlines. Since the appearance of the official register notice on August 7, the chattering class in Tunisia has not ceased to speculate about the reasons behind the decision.
In a mid-October telcon with Ambassador Godec, Mrs. Arafat attributed her ouster to the personal animus of First Lady Leila Ben Ali, following a dispute over the forced closure of the Bouebdelli School, a well-respected private school. Had it remained open, the Bouebdelli School would have represented serious competition to the new Carthage International School, a joint venture between the two First Ladies. It is doubtful that we will ever know all of the facts in this affair, but the stories of corruption swirling around the Carthage International School have a ring of truth to them. Meanwhile, Mrs. Arafat was not shy in sharing with the Ambassador stinging criticism of President Ben Ali, the First Lady, and the web of corruption that she says surrounds them. End Summary.
------------------
Easy Come, Easy Go
------------------
2. (C) On August 7, the GOT's Official Journal contained a one-sentence announcement of decree number 2007-1976 of August 2, 2007, revoking the citizenship of Suha Arafat, wife of the late Palestinian Authority President Yassir Arafat.
As reported Ref B, the GOT had only granted Tunisian nationality, by naturalization, to Mrs. Arafat and her 12 year-old daughter Zahwa in September, 2006. (Note: The GOT did not revoke the citizenship of Mrs. Arafat's daughter.
End Note.) The GOT's decision to revoke the citizenship of Mrs. Arafat came without warning. In an early July telcon with the Ambassador, Mrs. Arafat gave no indication that anything was amiss. Indeed, she indicated that she would like to meet with the Ambassador when she returned from her vacation in Malta later in the summer. Nor were there any distress signals in Ref A conversation with Mrs. Arafat, which also took place in early summer.
3. (C/NF) In a mid-October telcon with the Ambassador, Ms.
Arafat blamed her ouster on the personal animus of First Lady Leila Ben Ali. "I can't believe what she's has done to me," Arafat exclaimed, "I've lost everything!" She charged that all of her properties in Tunisia had been confiscated, even by falsifying documents transferring ownership. (Note: It is rumored that Mrs. Arafat had invested -- and lost -- some 2.5 million euros in the Carthage International School. End Note.) In addition, she said, her friends and colleagues in Tunisia, including her banker, had also come under pressure.
"Anyone who supports me is punished."
----------------------------------------
But, Why?: The School Theory, Version I
----------------------------------------
4. (C/NF) Mrs. Arafat attributed her ouster to her falling out with First Lady Leila Ben Ali over the Carthage International School, a new, private, for-profit school, of which they had been co-owners. According to Mrs. Arafat's version of events, the dispute stemmed from Leila Ben Ali's decision to force the closure of the Bouebdelli school (also known as by the name of its parent group, Le Fondation Louis Pasteur), a highly respected private school, from which many of Tunisia's elite have graduated. (Note: The Bouebdelli school was notified in mid-May that the Minister of Education had ordered it to close, ostensibly for failure to comply with registration regulations. Public outcry ensued, fueled in part by a petition and letter-writing campaign organized by parents of Bouebdelli schoolchildren. Many local and international media reports criticized the decision to close the school as a flagrant attempt to stifle potential competition of the International School of Carthage. The fact that parents of Bouebdelli schoolchildren were encouraged to enroll their children at the Carthage school only served to fuel these charges, as did the August 29 Presidential decree in which President Ben Ali granted 1,794,600 Tunisian Dinars (approximately US $ 1.5 million) to the Carthage School, an estimated 25 percent of its operating budget.)
5. (C/NF) Mrs. Arafat asserted that Leila Ben Ali had overreached in the decision to force the Bouebdelli School to close. She claimed that she had tried to convince the Tunisian First Lady that "what we are doing is unethical," and that competition ultimately would be healthy for the new school. Their arguments over this issue continued to escalate, according to Mrs. Arafat, culminating in the decision to revoke her citizenship while she was on vacation in Malta. Mrs. Arafat told the Ambassador that she intends to remain in Malta, where her brother serves as Palestinian Ambassador, but that she hopes to spend Christmas in the Palestinian Territories.
-----------------------------------------
But Why?: Version II of the School Theory
-----------------------------------------
6. (C/NF) Other rumors have circulated with a different spin on the school story. According to this theory, it was Mrs.
Arafat who overreached, not Leila Ben Ali. Specifically, it is said that Mrs. Arafat convinced the Ministry of Education to force the closure of the Bouebdelli School. She reportedly did so by invoking the name of Mrs. Ben Ali.
Critically, though, according to this theory, Leila Ben Ali was not aware that her name was being invoked. Thus, the Tunisian First Lady was incensed when she learned about the school's closure -- and her alleged role in that decision -in the highly critical pieces in the local and international media. (Comment: The fact that the Bouebdelli School did not reopen, even after the revocation of Suha Arafat's citizenship, would seem to cast doubt on the accuracy of this theory. End Comment.)
------------------------------------
But Why?: An Array of Other Theories
------------------------------------
7. (C/NF) Plenty of other theories have stoked the rumor mill in the Suha Arafat affair. One well-connected Palestinian resident in Tunisia told EmbOff that what sealed Mrs.
Arafat's fate was that on a recent visit to Tripoli, she had asked Libyan Leader Qaddafi for money. Qaddafi had readily provided a hand-out, but he reportedly subsequently called President Ben Ali to chastise him for failing to provide adequately for the widow of the late Palestinian President.
Ben Ali's acute embarrassment, so the story goes, quickly turned to wrath. It was not long before Mrs. Arafat's citizenship was revoked. Another theory holds that Suha Arafat was ousted because she had absconded with a significant amount of the first family's assets. Finally, in the face of persistent rumors that Mrs. Arafat had secretly married Belhassen Trabelsi, brother of the Tunisian First Lady, some commentators chalked up the whole ordeal to the failure of that relationship.
---------------------------------------
Scathing Commentary on the First Family
---------------------------------------
8. (C/NF) No doubt as a result of her tribulations, Mrs.
Arafat was not shy about sharing with the Ambassador her negative impressions of President Ben Ali, his wife, and her family members, whom, she said, collectively represent a web of corruption. Drawing on her close contact with the first family over the past several years, she made several allegations, among them the following:
-- President Ben Ali remains weakened by his battle with cancer (NFI);
-- President Ben Ali spends all his time playing with his son and following him around the residence;
-- President Ben Ali simply does what his wife asks him to do;
-- Leila Ben Ali and her family are stealing everything of value in the country;
-- Leila Ben Ali believes that she will succeed her husband as President of Tunisia;
-- The members of Ben Ali's extended family can do whatever they want with impunity, including the falsification of documents;
-- Leila Ben Ali dropped the American curriculum that had been planned for the Carthage school because she fundamentally wants nothing to do with Americans.
-------
TUNIS 00001489 003 OF 003
Comment
-------
9. (C/NF) It is doubtful that we will ever know all of the facts in the Suha Arafat affair, or, for that matter in the Bouebdelli School/Carthage International School matter.
Clearly, having been stripped of her Tunisian citizenship and deprived of her properties here, Suha Arafat has an ax to grind with the Ben Ali clan, so her allegations must be taken with a big grain of salt. Although difficult to prove, there is a certain ring of truth to the stories of corruption swirling around the school issue. While it is not clear who was behind the Bouebdelli closure, the ready-made pool of students for whom Bouebdelli was no longer an option was certainly convenient for filling the classrooms in the Carthage School's opening year. Indeed, during a mid-September visit to the Carthage School, MgmtCouns learned that the school is filled to capacity. Beyond that, no school in recent memory has been constructed so quickly, had municipally provided access roads, street signs, and traffic lights installed so efficiently, or had such ease in getting certified (although it has not yet received the French accreditation the Bouebdelli School had). Nor is it common practice for the GOT to so generously subsidize a for-profit educational institution. Finally, it must be noted that the school affair, while rather blatant, is not an isolated case of favoritism and corruption. We will continue to follow this issue and report septel on other corruption charges.
End Comment.
GODEC
Permalink:https://tunileaks.appspot.com/?p=39001
]]>ID: 82077
Date: 2006-10-17 06:41:00
Origin: 06TUNIS2570
Source: Embassy Tunis
Classification: CONFIDENTIAL
Dunno: 06TUNIS2565
Destination: VZCZCXYZ0000
PP RUEHWEB
DE RUEHTU #2570 2900641
ZNY CCCCC ZZH
P 170641Z OCT 06
FM AMEMBASSY TUNIS
TO RUEHC/SECSTATE WASHDC PRIORITY 2039
INFO RUEHXK/ARAB ISRAELI COLLECTIVE
C O N F I D E N T I A L TUNIS 002570
SIPDIS
SENSITIVE
SIPDIS
FOR NEA/MAG (HARRIS) AND NEA/IPA
E.O. 12958: DECL: 10/17/2016
TAGS: PREL, KPAL, TS
SUBJECT: SUHA ARAFAT ACQUIRES TUNISIAN NATIONALITY
REF: TUNIS 2565
Classified By: CDA David Ballard for reasons 1.4 (b) and (d).
1. (SBU) The Government of Tunisia's Official Journal of September 26 published a notice that Suha Arafat, wife of the late Palestinian Authority president, and her 11-year old daughter Zahwa had acquired Tunisian nationality. Mrs.
Arafat and her daughter have been living in Tunisia since the 2004 death of Yasser Arafat, and Zahwa Arafat attends the American Cooperative School of Tunisia. Suha Arafat's presence in Tunisia long predates that, however. She had been a resident of Tunisia prior to her marriage, and, after residing in the Palestinian Territories from 1996-98, she returned in 1998, alternating between residences in France and Tunisia.
2. (SBU) The above news item has been picked up by various media outlets, including Reuters. Other recent wire reports on Mrs. Arafat, reporting her alleged marriage to Belhassen Trabelsi, the brother-in-law of Tunisian President Zine El Abidine Ben Ali, are false, however, and Mrs. Arafat has been quite vocal in denying them in the press.
3. (C) Comment: We remain puzzled as to why Mrs. Arafat would want Tunisian citizenship, and why now, since she already enjoyed the privilege of a Tunisian diplomatic passport, and we doubt that she was eager to exercise her right to vote in Tunisia or become a member of the Tunisian National Assembly. The only other tangible benefit of citizenship is that Tunisian law forbids foreigners to own agricultural land -- and Mrs. Arafat is not known to be an aspiring farmer. One possible motivation is that under Tunisian law, foreign participation in a totally non-exporting service industry cannot exceed 50 percent.
Several months ago, Mrs. Arafat set up one such company -- to build an international school in Tunis. Tunisian citizenship will allow her to control this company. As for what was in such a move for the GOT, Post suspects that a continuing desire on the part of the government to market itself as closely tied to the Palestinian people played a role. The GOT probably feels the need for some Palestinian "cover" during this time when newspapers are full of stories on the government's campaign against the hijab (reftel). In addition, Mrs. Arafat is said to be good friends with the First Lady, Leila Ben Ali. End Comment.
BALLARD
PP RUEHWEB
DE RUEHTU #0679/01 1751355
ZNY SSSSS ZZH
P 231355Z JUN 08
FM AMEMBASSY TUNIS
TO RUEHC/SECSTATE WASHDC PRIORITY 5219
INFO RUCNMGH/MAGHREB COLLECTIVE PRIORITY
SS E C R E T TUNIS 000679
SIPDIS
STATE FOR NEA/MAG (HARRIS)
STATE PASS USTR (BURKHEAD)
USDOC FOR ITA/MAC/ONE (NATHAN MASON), ADVOCACY CTR
(REITZE), AND CLDP (TEJTEL AND MCMANUS)
CASABLANCA FOR FCS (ORTIZ)
CAIRO FOR FINANCIAL ATTACHE (SEVERENS)
LONDON AND PARIS FOR NEA WATCHER
E.O. 12958: DECL: 06/23/2018
TAGS: ECON KCOR PGOV EINV EFIN SOCI TS
SUBJECT: CORRUPTION IN TUNISIA: WHAT'S YOURS IS MINE
REF: A. TUNIS 615
B. TUNIS 568
C. TUNIS 365
D. TUNIS 169
E. TUNIS 113
F. 07 TUNIS 1489
G. 07 TUNIS 1443
H. 07 TUNIS 1433
I. 06 TUNIS 2848
J. 06 TUNIS 1673
K. 06 TUNIS 1672
L. 06 TUNIS 1630
M. 06 TUNIS 1622
N. 01 TUNIS 2971
Classified By: Ambassador Robert F. Godec for Reasons 1.4 (b) and (d).
------
Summary
------
1. (S) According to Transparency International's annual survey and Embassy contacts' observations, corruption in Tunisia is getting worse. Whether it's cash, services, land, property, or yes, even your yacht, President Ben Ali's family is rumored to covet it and reportedly gets what it wants.
Beyond the stories of the First Family's shady dealings, Tunisians report encountering low-level corruption as well in interactions with the police, customs, and a variety of government ministries. The economic impact is clear, with Tunisian investors -- fearing the long-arm of "the Family" -forgoing new investments, keeping domestic investment rates low and unemployment high (Refs G, H). These persistent rumors of corruption, coupled with rising inflation and continued unemployment, have helped to fuel frustration with the GOT and have contributed to recent protests in southwestern Tunisia (Ref A). With those at the top believed to be the worst offenders, and likely to remain in power, there are no checks in the system. End Summary.
------------------
The Sky's the Limit
------------------
2. (C) According to Transparency International's 2007 index, the perception is that corruption in Tunisia is getting worse. Tunisia's ranking on the index dropped from 43 in 2005 to 61 in 2007 (out of 179 countries) with a score of 4.2 (with 1 the most corrupt and 10 the least corrupt). Although corruption is hard to verify and even more difficult to quantify, our contacts all agree that the situation is headed in the wrong direction. When asked whether he thought corruption was better, worse, or the same, XXXXXXXXXXXX exclaimed in exasperation, "Of course it's getting worse!" He stated that corruption could not but increase as the culprits looked for more and more opportunities. Joking about Tunisia's rising inflation, he said that even the cost of bribes was up. "A traffic stop used to cost you 20 dinars and now it's up to 40 or 50!"
----------------
All in the Family
----------------
3. (S) President Ben Ali's extended family is often cited as the nexus of Tunisian corruption. Often referred to as a quasi-mafia, an oblique mention of "the Family" is enough to indicate which family you mean. Seemingly half of the Tunisian business community can claim a Ben Ali connection through marriage, and many of these relations are reported to have made the most of their lineage. Ben Ali's wife, Leila Ben Ali, and her extended family -- the Trabelsis -- provoke the greatest ire from Tunisians. Along with the numerous allegations of Trabelsi corruption are often barbs about their lack of education, low social status, and conspicuous consumption. While some of the complaints about the Trabelsi clan seem to emanate from a disdain for their nouveau riche inclinations, Tunisians also argue that the Trabelsis strong arm tactics and flagrant abuse of the system make them easy to hate. Leila's brother Belhassen Trabelsi is the most notorious family member and is rumored to have been involved in a wide-range of corrupt schemes from the recent Banque de Tunisie board shakeup (Ref B) to property expropriation and extortion of bribes. Leaving the question of their progenitor aside, Belhassen Trabelsi's holdings are extensive and include an airline, several hotels, one of Tunisia's two private radio stations, car assembly plants, Ford distribution, a real estate development company, and the list goes on. (See Ref K for a more extensive list of his holdings.) Yet, Belhassen is only one of Leila's ten known siblings, each with their own children. Among this large extended family, Leila's brother Moncef and nephew Imed are also particularly important economic actors.
4. (S/NF) The President is often given a pass, with many Tunisians arguing that he is being used by the Trabelsi clan and is unaware of their shady dealings. XXXXXXXXXXXX a strong supporter of the government and member of XXXXXXXXXXXX, told the Ambassador that the problem is not Ben Ali, but "the Family" going too far and breaking the rules. Nevertheless, it is hard to believe Ben Ali is not aware, at least generally, of the growing corruption problem.
This might also reflect the seeming geographical divisions between the Ben Ali and Trabelsi fiefdoms, with the Ben Ali clan reportedly focused on the central coastal regional and the Trabelsi clan operating out of the greater Tunis area and therefore, generating the bulk of the gossip. The Ben Ali side of the Family and his children and in-laws from his first marriage are also implicated in a number of stories.
Ben Ali has seven siblings, of which his late brother Moncef was a known drug trafficker, sentenced in absentia to 10 years prison in the French courts. Ben Ali has three children with his first wife Naima Kefi: Ghaouna, Dorsaf and Cyrine. They are married respectively to Slim Zarrouk, Slim Chiboub, and Marouane Mabrouk -- all significant economic powers.
-------------------------------------------
This Land is Your Land, This Land is My Land
-------------------------------------------
5. (S/NF) With real estate development booming and land prices on the rise, owning property or land in the right location can either be a windfall or a one-way ticket to expropriation. In summer 2007, Leila Ben Ali received a desirable tract of land in Carthage for free from the GOT in order to build the for-profit Carthage International School (Ref F). In addition to the land, the school received a 1.8 million dinar (US $1.5 million) gift from the GOT, and within a matter of weeks the GOT had built new roads and stoplights to facilitate school access. It has been reported that Ms.
Ben Ali has sold the Carthage International School to Belgian investors, but the Belgian Embassy has as yet been unable to confirm or discount the rumor. XXXXXXXXXXXX asserted that the school was indeed sold for a huge, but undisclosed sum.
He noted any such sale would be pure profit since Ms. Ben Ali's received land, infrastructure, and a hefty bonus at no cost.
6. (S/NF) Construction on an enormous and garish mansion has been underway next to the Ambassador's residence for the past year. Multiple sources have told us that the home is that of Sakhr Materi, President Ben Ali's son-in-law and owner of Zitouna Radio. This prime real estate was reportedly expropriated from its owner by the GOT for use by the water authority, then later granted to Materi for private use. A cafe owner recounted a similar tale to an Embassy employee, reporting that Belhassen Trabelsi forced him to trade in a cafe he previously owned in a prime location for his current cafe. The cafe owner stated Trabelsi told him he could do whatever he wanted there; if 50 dinar bribes to the police were not effective, Trabelsi said the owner had only to call him and he would "take care of it."
-----------
Yacht Wanted
-----------
6. (S/NF) In 2006, Imed and Moaz Trabelsi, Ben Ali's nephews, are reported to have stolen the yacht of a well-connected French businessman, Bruno Roger, Chairman of Lazard Paris. The theft, widely reported in the French press, came to light when the yacht, freshly painted to cover distinguishing characteristics, appeared in the Sidi Bou Said harbor. Roger's prominence in the French establishment created a potential irritant in bilateral relations and according to reports, the yacht was swiftly returned. The stolen yacht affair resurfaced in early 2008 due to an Interpol warrant for the two Trabelsis. In May, the brothers were brought before Tunisian courts, in a likely effort to satisfy international justice. The outcome of their case has not been reported.
-----------------
Show Me Your Money
-----------------
7. (S) Tunisia's financial sector remains plagued by serious allegations of corruption and financial mismanagement.
Tunisian business people joke that the most important relationship you can have is with your banker, reflecting the importance of personal connections rather than a solid business plan in securing financing. The legacy of relationship-based banking is a sector-wide rate of non-performing loans that is 19 percent, which remains high but is lower than a high of 25 percent in 2001 (Ref I).
Embassy contacts are quick to point out that many of these loans are held by wealthy Tunisian business people who use their close ties to the regime to avoid repayment (Ref E).
Lax oversight makes the banking sector an excellent target of opportunity, with multiple stories of "First Family" schemes.
The recent reshuffle at Banque de Tunisie (Ref B), with the Foreign Minister's wife assuming the presidency and Belhassen Trabelsi named to the board, is the latest example.
According to a representative from Credit Agricole, Marouane Mabrouk, another of Ben Ali's sons-in-law, purchased a 17 percent share of the former Banque du Sud (now Attijari Bank) shares immediately prior to the bank's privatization. This 17 percent share was critical to acquiring controlling interest in the bank since the privatization represented only a 35 percent share in the bank. The Credit Agricole rep stated that Mabrouk shopped his shares to foreign banks with a significant premium, with the tender winner, Spanish-Moroccan Santander-Attijariwafa ultimately paying an off the books premium to Mabrouk. XXXXXXXXXXXX recounted that when he was still at his bank he used to receive phone calls from panicked clients who stated that Belhassen Trabelsi had asked them for money. He did not indicate whether he advised them to pay.
----------------------
The Trickle Down Effect
----------------------
8. (S) While the stories of high-level, Family corruption are among the most flagrant and oft-repeated, Tunisians report encountering low-level corruption more frequently in their daily lives. Speeding tickets can be ignored, passports can be expedited, and customs can be bypassed -- all for the right price. Donations to the GOT's 26-26 Fund for development or to the Bessma Society for the Handicapped -Leila Ben Ali's favored charity -- are also believed to grease the wheels. Hayet Louani (protect), a well-connected member of Parliament, faced increased pressure from the GOT after refusing several "requests" to donate money to Trabelsi's soccer team. XXXXXXXXXXXX reported that customs inspectors demanded 10,000 dinars to get his goods through customs; he did not reveal whether or not he acquiesced to the demand.
9. (S) Nepotism is also believed to play a significant role in awarding scholarships and offering jobs. Knowing the right people at the Ministry of Higher Education can determine admission to the best schools or can mean a scholarship for study abroad. An Embassy FSN stated that the Director of International Cooperation, a long-time contact, offered to give his son a scholarship to Morocco on the basis of their acquaintance. If you do not know someone, money can also do the trick. There are many stories of Tunisians paying clerks at the Ministry of Higher Education to get their children into better schools than were merited by their test scores. Government jobs -- a prize in Tunisia -- are also believed to be doled out on the basis of connections.
Leila Ben Ali's late mother, Hajja Nana, is also reported to have acted as a broker for both school admissions and government job placement, providing her facilitation services for a commission. Among the complaints from the protestors in the mining area of Gafsa were allegations that jobs in the Gafsa Phosphate Company were given on the basis of connections and bribery.
--------
Mob Rule?
--------
10. (S/NF) The numerous stories of familial corruption are certainly galling to many Tunisians, but beyond the rumors of money-grabbing is a frustration that the well-connected can live outside the law. One Tunisian lamented that Tunisia was no longer a police state, it had become a state run by the mafia. "Even the police report to the Family!" he exclaimed.
With those at the top believed to be the worst offenders, and likely to remain in power, there are no checks in the system. The daughter of a former governor recounted that Belhassen Trabelsi flew into her father's office in a rage -even throwing an elderly office clerk to the ground -- after being asked to abide by laws requiring insurance coverage for his amusement park. Her father wrote a letter to President Ben Ali defending his decision and denouncing Trabelsi's tactics. The letter was never answered, and he was removed from his post shortly thereafter. The GOT's strong censorship of the press ensures that stories of familial corruption are not published. The Family's corruption remains a red line that the press cross at their own peril.
Although the February imprisonment of comedian Hedi Oula Baballah was ostensibly drug-related, human rights groups speculate his arrest was punishment for a 30 minute stand-up routine spoofing the President and his in-laws (Tunis D).
International NGOs have made the case that the harsh prison conditions faced by journalist Slim Boukdhir, who was arrested for failing to present his ID card and insulting a police officer, are directly related to his articles criticizing government corruption. Corruption remains a topic relegated to hushed voices with quick glances over the shoulder.
-----------------------
The Elephant in the Room
-----------------------
11. (S) Several Tunisian economists argue that it does not matter whether corruption is actually increasing because "perception is reality." The perception of increasing corruption and the persistent rumors of shady backroom dealings has a negative impact on the economy regardless of the veracity. Contacts tell us they afraid to invest for fear that the family will suddenly want a cut. "What's the point?" Alaya Bettaieb asked, "The best case scenario is that my investment succeeds and someone important tries to take a cut." Persistently low domestic investment rates bear this out (Ref H). Foreign bank accounts, while illegal, are reportedly commonplace. A recent Ministry of Finance amnesty to encourage Tunisians to repatriate their funds has been an abject failure. Bettaeib stated that he plans to incorporate his new business in Mauritania or Malta, citing fear of unwanted interference. Many economists and business people note that strong investment in real estate and land reflects the lack of confidence in the economy and an effort to keep their money safe (Ref C).
12. (S) Thus far, foreign investors have been undeterred, and according to Tunisian business contacts, largely unaffected.
Foreign investment continues to flow in at a healthy rate, even excluding the privatizations and huge Gulf projects which have yet to get underway. Foreign investors more rarely report encountering the type of extortion faced by Tunisians, perhaps reflecting that foreign investors have recourse to their own embassies and governments. British Gas representatives told the Ambassador they had not encountered any impropriety. XXXXXXXXXXXX stated that several years ago Belhassen Trabelsi attempted to strong arm a German company producing in the offshore sector, but that after the German Embassy intervened Trabelsi was explicitly cautioned to avoid offshore companies. Despite pronouncements about increasing domestic investment, the GOT focuses heavily on increasing FDI flows to the country, particularly in the offshore sector. Nevertheless, there are still several examples of foreign companies or investors being pressured into joining with the "right" partner. The prime example remains McDonald's failed entry into Tunisia. When McDonald's chose to limit Tunisia to one franchisee not of the GOT's choosing, the whole deal was scuttled by the GOT's refusal to grant the necessary authorization and Macdonald's unwillingness to play the game by granting a license to a franchisee with Family connections.
------
Comment
------
13. (S) Although the petty corruption rankles, it is the excesses of President Ben Ali's family that inspire outrage among Tunisians. With Tunisians facing rising inflation and high unemployment, the conspicuous displays of wealth and persistent rumors of corruption have added fuel to the fire.
The recent protests in the mining region of Gafsa provide a potent reminder of the discontent that remains largely beneath the surface. This government has based its legitimacy on its ability to deliver economic growth, but a growing number of Tunisians believe those as the top are keeping the benefits for themselves.
14. (S) Corruption is a problem that is at once both political and economic. The lack of transparency and accountability that characterize Tunisia's political system similarly plague the economy, damaging the investment climate and fueling a culture of corruption. For all the talk of a Tunisian economic miracle and all the positive statistics, the fact that Tunisia's own investors are steering clear speaks volumes. Corruption is the elephant in the room; it is the problem everyone knows about, but no one can publicly acknowledge. End Comment.
Please visit Embassy Tunis' Classified Website at: http://www.state.sgov.gov/p/nea/tunis/index.c fm
GODEC
Permalink:https://tunileaks.appspot.com/?p=33002
]]>PP RUEHWEB
DE RUEHTU #0516/01 2081609
ZNY SSSSS ZZH
P 271609Z JUL 09
FM AMEMBASSY TUNIS
TO RUEHC/SECSTATE WASHDC PRIORITY 6604
INFO RUCNMGH/MAGHREB COLLECTIVE PRIORITY
RUEHRL/AMEMBASSY BERLIN PRIORITY 0189
RUEHLO/AMEMBASSY LONDON PRIORITY 1481
RUEHMO/AMEMBASSY MOSCOW PRIORITY 0371
RUEHOT/AMEMBASSY OTTAWA PRIORITY 0251
RUEHFR/AMEMBASSY PARIS PRIORITY 1963
RUEHRO/AMEMBASSY ROME PRIORITY 0806
RUEHKO/AMEMBASSY TOKYO PRIORITY 0175
S E C R E T TUNIS 000516
SIPDIS
NEA/MAG; INR/B
EO 12958 DECL: 02/28/2017
TAGS PREL, PTER, PGOV, PINR, ENRG, EAID, TS
SUBJECT: TUNISIA: DINNER WITH SAKHER EL MATERI
REF: TUNIS 338
Classified By: Ambassador Robert F. Godec for reasons 1.4 (b) and (d)
------
Summary
------
1. (S) The Ambassador and his wife had dinner with Mohammad Sakher El Materi and his wife, Nesrine Ben Ali El Materi, at their Hammamet home July 17. During the lavish dinner Al Materi raised the question of the American Cooperative School of Tunis and said he would seek to “fix the problem prior to the Ambassador’s departure” as a gesture to a “friend.” He praised President Obama’s policies and advocated a two-state solution for Israel and the Palestinians. He also expressed interest in opening a McDonald’s franchise and complained about the government’s delay in passing a franchise law. He expressed pride in his Islamic Zaitouna radio and in the interviews with opposition party leaders published in his newly purchased newspaper publishing group. During the evening, El Materi was alternately difficult and kind. He seemed, on occasion, to be seeking approval. He was living, however, in the midst of great wealth and excess, illustrating one reason resentment of President Ben Ali’s in-laws is increasing. End Summary.
-----------------
The ACST Situation
-----------------
2. (S) Presidential son-in-law and wealthy businessman Mohamed Sakher El Materi, and his wife, Nesrine Ben Ali El Materi hosted the Ambassador and his wife for dinner at their Hammamet beach residence July 17. El Materi raised the American Cooperative School of Tunis (ACST), asking what was happening. The Ambassador explained the situation and emphasized that there is anger and concern in Washington and the English-speaking American/international community in Tunis. He said if the school is closed, there would be serious consequences in our relations. El Materi said he could help and would seek to resolve the situation immediately, i.e., prior to the Ambassador’s departure. He wished, he said, to do so for a “friend.” He noted that he had helped the UK Ambassador secure several appointments (including a lunch with the Prime Minister) for UK Prince Andrew during his recent visit. Before his intervention, El Materi said, the Prince had only one appointment with a single Minister.
--------------------
Freedom of Expression
--------------------
3. (S) Ambassador raised the need for more freedom of expression and association in Tunisia. El Materi agreed. He complained that, as the new owner of Dar Assaba, the largest private newspaper group in the country, he has been getting calls from the Minister of Communications complaining about articles he has been running (Comment: This is doubtful). He laughed and suggested that sometimes he wants to “give Dar Assaba back.” El Materi noted the interviews his newspapers have been running with opposition leaders (he mentioned FDTL Secretary General Mustapha Ben Jaafar). He was clearly proud of the interviews.
4. (S) El Materi said it was important to help others, noting that was one reason he had adopted a son. The Ambassador mentioned the Embassy’s humanitarian assistance projects, noting they could not get media coverage. El Materi said forcefully they should be covered, that it was important the Embassy seek such coverage. He said it would counteract some of the negative US image. The Ambassador asked if El Materi would send reporters to do stories on the US assistance projects. El Materi said yes, absolutely.
5. (S) El Materi complained at length about Tunisian bureaucracy, saying it is difficult to get things done. He said communication inside the bureaucracy is terrible. He said people often “bring wrong information” to the President implying he had to get involved sometimes to get things corrected.
---------------------------------
On Exterior Politics and Economics
---------------------------------
6. (S) El Materi praised President Barack Obama’s new policies. He said the invasion of Iraq was a very serious US mistake that had strengthened Iran and bred hatred of the United States in the Arab world. He pressed for a two state solution to resolve the Israeli-Palestinian dispute and indicated Tunisia needs to accelerate convertibility of the dinar. In general, however, El Materi’s knowledge of and interest in international political and economic issues seemed limited.
7. (S) The Ambassador raised economic liberalization, noting the importance of opening up to franchising. El Materi agreed, noting that he would be pleased to assist McDonald’s to enter Tunisia, suggesting they begin at the new cruise port in La Goulette. He complained about the unhealthy food served by McDonald’s, however, adding it is making Americans fat. He also complained about the GOT’s delay in passing a franchising law.
8. (S) The Ambassador noted he has been asking Tunisians what ideas they have for the new US President and Administration. El Materi commented that Nesrine would like more done on the environment. The Ambassador responded by explaining some of the Administration’s policies on the environment. El Materi said Nesrine is focused on organic products and wants everything (even the paint and varnish) in their new house in Sidi Bou Said (next to the Ambassador’s residence) to be organic.
----
Islam
----
9. (S) El Materi said he had begun to practice Islam seriously at 17. He repeatedly said he was practicing, and had a strong faith. (NB. He went off to pray at the sunset call to prayer.) He suggested that if you have faith and pray to God, he will help. He emphasized that his religion is personal, and he does not believe it is appropriate to impose his views on others. (Comment. During the evening, El Materi seemed at his most passionate when describing the Koran, his belief in one God, and the importance of Mohamed as the final prophet of God.)
10. (S) El Materi said he was proud of Zeitouna radio, the first and only Tunisian Koranic radio station, and discussed how Zeitouna bank would be opening. He hopes to create a regional version of Zeitouna radio to spread the Malakite school of Islam. He expressed the view that Islamists and extremists pose a great threat to Islam and modernity. He said he follows Islam, but modern Islam.
--------------------------------------
El-Materi Unplugged: Home/Personal Life
--------------------------------------
11. (S) El-Materi’s house is spacious, and directly above and along the Hammamet public beach. The compound is large and well guarded by government security. It is close to the center of Hammamet, with a view of the fort and the southern part of the town. The house was recently renovated and includes an infinity pool and a terrace of perhaps 50 meters. While the house is done in a modern style (and largely white), there are ancient artifacts everywhere: Roman columns, frescoes and even a lion’s head from which water pours into the pool. El Materi insisted the pieces are real. He hopes to move into his new (and palatial) house in Sidi Bou Said in eight to ten months.
12. (S) The dinner included perhaps a dozen dishes, including fish, steak, turkey, octopus, fish couscous and much more. The quantity was sufficient for a very large number of guests. Before dinner a wide array of small dishes were served, along with three different juices (including Kiwi juice, not normally available here). After dinner, he served ice cream and frozen yoghurt he brought in by plane from Saint Tropez, along with blueberries and raspberries and fresh fruit and chocolate cake. (NB. El Materi and Nesrine had just returned from Saint Tropez on their private jet after two weeks vacation. El Materi was concerned about his American pilot finding a community here. The Ambassador said he would be pleased to invite the pilot to appropriate American community events.)
13. (S) El Materi has a large tiger (“Pasha”) on his compound, living in a cage. He acquired it when it was a few weeks old. The tiger consumes four chickens a day. (Comment: The situation reminded the Ambassador of Uday Hussein’s lion cage in Baghdad.) El Materi had staff everywhere. There were at least a dozen people, including a butler from Bangladesh and a nanny from South Africa. (NB. This is extraordinarily rare in Tunisia, and very expensive.)
14. (S) They have three children, two girls and a boy. Leila is four and another daughter that is about 10 months. Their boy is adopted and is two years old. The youngest daughter is a Canadian citizen, by virtue of birth in Canada. The family’s favorite vacation destination spot is the Maldives Islands.
15. (S) El Materi said he has begun an exercise and diet regime. He has, he said, recently lost weight (it was visibly true). El Materi said he eats in a “balanced” way. He had just spent an hour on a bike, he claimed. Nesrine said she gets no exercise.
16. (S) Both El Materi and Nesrine speak English, although their vocabulary and grammar are limited. They are clearly eager to strengthen their English. Nesrine said she loves Disney World, but had put off a trip this year because of H1N1 flu. Nesrine has, for sometime, had Tamiflu nearby (even taking it on trips). Originally it was out of fear of bird flu. She packs it for El Materi too when he travels. Nesrine said she has visited several US cities. El Materi had only been to Illinois recently in connection with the purchase of a plane.
------
Comment
------
17. (S) Throughout the evening, El Materi often struck the Ambassador as demanding, vain and difficult. He is clearly aware of his wealth and power, and his actions reflected little finesse. He repeatedly pointed out the lovely view from his home and frequently corrected his staff, issued orders and barked reprimands. Despite this, El Materi was aware of his affect on the people around him and he showed periodic kindness. He was unusually solicitous and helpful to the Ambassador’s wife, who is disabled. Occasionally, he seemed to be seeking approval. One western Ambassador in Tunis, who knows El Materi, has commented that he has western-style political skills in his willingness to engage with ordinary citizens. It is an uncommon trait here.
18. (S) El Materi, in recent months, has been ever more visible in the local diplomatic community. He has clearly decided (or been told) to serve as a point of contact between the regime and key ambassadors. Nesrine, at age 23, appeared friendly and interested, but nave and clueless. She reflected the very sheltered, privileged and wealthy life she has led. As for the dinner itself, it was similar to what one might experience in a Gulf country, and out of the ordinary for Tunisia.
19. (S) Most striking of all, however, was the opulence with which El Materi and Nesrine live. Their home in Hammamet was impressive, with the tiger adding to the impression of “over the top.” Even more extravagant is their home still under construction in Sidi Bou Said. That residence, from its outward appearance, will be closer to a palace. It dominates the Sidi Bou Said skyline from some vantage points and has been the occasion of many private, critical comments. The opulence with which El Materi and Nesrine live and their behavior make clear why they and other members of Ben Ali’s family are disliked and even hated by some Tunisians. The excesses of the Ben Ali family are growing.
Please visit Embassy Tunis’ Classified Website at: http://www.state.sgov.gov/p/nea/tunis/index.c fm
Godec
Permalink:https://tunileaks.appspot.com/?p=36001
]]>DE RUEHTU #0193/01 0631651
ZNY SSSSS ZZH
O 031651Z MAR 08
FM AMEMBASSY TUNIS
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4520
INFO RUEHEE/ARAB LEAGUE COLLECTIVE PRIORITY
SE C R E T TUNIS 000193
SIPDIS
NOFORN
SIPDIS
STATE FOR NEA/FO (WELCH, GRAY) AND NEA/MAG (HOPKINS, HARRIS)
STATE ALSO FOR S/WCI (WILLIAMSON, GOREY)
NSC FOR ABRAMS, YERGER
E.O. 12958: DECL: 02/28/2018
TAGS: PREL PTER PHUM PGOV KPAL KDRG KDEM TS
SUBJECT: PRESIDENT BEN ALI MEETS WITH A/S WELCH: PROGRESS ON COUNTER-TERRORISM COOPERATION, REGIONAL CHALLENGES
Classified By: Ambassador Robert F. Godec for reasons 1.4 (b) and (d)
-------
Summary
-------
1. (S/NF) President Ben Ali and NEA Assistant Secretary David Welch discussed regional and bilateral issues in a wide-ranging, warm and open meeting on Thursday, February 28. In response to A/S Welch's remarks and requests, President Ben Ali:
-- promised counter-terrorism cooperation "without reservation," including US access to a terrorist in Tunisian custody;
-- said the GOT would accept the ten remaining Tunisian detainees in Guantanamo on the basis of the constitution;
-- welcomed the Annapolis peace process, adding that Palestinian Authority President Mahmoud Abbas is "optimistic" a deal will be concluded and plans to visit Tunis in March; and,
-- said there is "no reason" for an Arab League Summit in Damascus unless there is a Lebanese president and opined that the meeting might be postponed or representation downgraded.
2. (S/NF) Welch and Ben Ali also covered US-Libyan relations, relations between Morocco and Algeria, the situation in Iraq and the challenge of Iran. The constructive session underscored again that Tunisia is prepared to play a moderate, but not a leadership, role on regional problems. Overall, Ben Ali was clearly pleased with Welch's visit and it received wide media coverage. End
--------------------
Meeting: The Setting
--------------------
3. (S/NF) During his February 27 - 29 visit, NEA A/S David Welch met with President Zine El Abidine Ben Ali for one hour 45 minutes at the Presidential Palace in Carthage on Thursday, February 28. Foreign Minister Abdelwaheb Abdallah and Ambassador Godec were also present. The Director of Tunisia's External Communications Agency (ATCE), Oussama Romdhani, was the interpreter.
--------------------------------------------- ------------
Bilateral Relations: CT Cooperation "Without Reservation"
--------------------------------------------- ------------
4. (S/NF) Ben Ali began by emphasizing the excellent, "strategic" relations between the United States and Tunisia. He continued, however, that he understood the United States had concerns about cooperation on counter-terrorism. Ben Ali said he had ordered Minister of Interior Rafik Belhaj Kacem and other senior officials to cooperate with the United States "without reservation" on counter-terrorism.
5. (S/NF) The President stressed that Tunisia cooperated with the United States on terrorism out of conviction, and said broader, deeper international cooperation is essential. Many countries, he said, have suffered as the result of terrorism. He expressed regret, however, over the human rights criticism Tunisia has faced as the result of its efforts to combat terrorism. Some governments have a "double standard," he said, on the issue. He added "some embassies" in Tunis and human rights groups had taken positions that were "not friendly" over such cases such as the imprisonment of activist Mohammed Abbou and of the "Zarzis group." (NB. The "Zarzis group" refers to six Tunisians detained in 2003 for allegedly preparing to commit terrorist attacks. The six were pardoned by Ben Ali in 2006 following international pressure.) Ben Ali acknowledged that there had been some problems with human rights in Tunisia, but stressed the GOT is addressing them. For example, he said, "tens" of police officers have been tried for corruption and other abuses. He said he would welcome the US Embassy receiving further information. He stressed that the GOT is committed to freedom and human rights, but no one is above the law.
6. (S/NF) A/S Welch thanked Ben Ali and expressed appreciation for his commitment to cooperation on counter-terrorism. He said he had two specific requests: 1) access for US officials to interview Tunisian terrorist Noureddine Taam and 2) a commitment to accept the Tunisian detainees in Guantanamo on the basis of earlier assurances on treatment. Ben Ali responded that the United States would have immediate access to Taam. (NB. Additional details reported in GRPO channels.) He continued that the GOT would accept the detainees and do so on the basis of the Tunisian constitution. (NB. The Tunisian constitution offers guarantees on human rights, humane treatment and respect for international commitments.) Ben Ali emphasized again that on counter-terrorism and intelligence Tunisia would "cooperate with the United States without inhibitions" and the cooperation would be "total."
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Libya: Trying to Improve US Relations
-------------------------------------
7. (S/NF) A/S Welch said the United States is improving relations with Libya, but from time to time has difficulties with leader Muammar Qadhafi. Welch asked that Ben Ali communicate to Qadhafi that the United States wants to continue to improve relations. Ben Ali replied that Qadhafi also wants better relations, but there remain "anti-American radicals" in the government. Qadhafi plans, according to Ben Ali, a cabinet reshuffle that would address the problem and we should see how the situation evolves. Qadhafi, Ben Ali opined, is "not a normal person" and had experienced disappointments over the failure of Arab and African unity. Ben Ali promised to raise the US interest in improving relations with Qadhafi in person or by phone.
--------------------------------------------
Middle East: The Peace Process Needs Support
--------------------------------------------
8. (S) Welch stressed that President Bush's highest priority this year is progress toward two states, Palestine and Israel, living side-by-side in peace. While Palestinian Authority President Abbas and Prime Minister Olmert genuinely want peace, some of the Palestinian and Israeli people and leaders are skeptical. Welch stressed that all countries interested in peace need to make every effort to help move the process forward.
9. (S) Ben Ali agreed on the importance of the Annapolis process, adding he had spoken with Abbas who is "optimistic" an agreement will be reached by the end of the year. Nevertheless, progress will remain very difficult. Ben Ali stressed Fatah and Hamas must try to reach an understanding. He noted that Abbas will visit Tunisia in March and there is a proposal for a Fatah-Hamas meeting in Tunis. Ben Ali said he will wait to hear Abbas' views before proceeding on the proposal.
--------------------------------------------- -------
Arab League Summit: Not Without A Lebanese President
--------------------------------------------- -------
10. (S) Welch asked Ben Ali about his views of Syria and the proposed Arab League Summit. Ben Ali responded that Syria is a source of concern. He said Syria is acting for Iran and the latter is fueling regional problems. He said he had met (on February 18) with Syrian Foreign Minister Walid Mu'allim who handed over an invitation from President Bashar Asad to attend the summit in Damascus. He said he told Mu'allim that Syria should help resolve the problems in Lebanon. Ben Ali emphasized the complexity of the situation in Lebanon, noting the unhelpful involvement of many regional actors. He added that there was some support for inviting Iran to the Damascus Summit. Ben Ali said, however, that he saw no reason for the summit unless there is a Lebanese president in attendance. Welch agreed. Ben Ali continued the summit may be postponed, or representation downgraded from the Chief of State level. He noted other states in the region, including Morocco, Jordan, and Saudi Arabia agreed. In any event, Ben Ali said he would not attend such a summit.
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Iraq: Bleak Situation
---------------------
11. (S/NF) Ben Ali said the situation in Iraq is "bleak," but we must face it. The only party benefiting currently is Iran, and suggested that Turkey's current actions against the PKK are making matters worse. Welch noted there is some progress on the security situation and the political front in Iraq.
-------------------
Region: "Explosive"
-------------------
12. (S) Looking more broadly, Ben Ali noted that Tunisia was happy it was part of the Maghreb, and not part of Levant or Gulf. He opined that the situation in Egypt is "explosive," adding that sooner or later the Muslim Brotherhood would take over. He added that Yemen and Saudi Arabia are also facing real problems. Overall, the region is "explosive."
-------------------------------------
Maghreb: Resolving the Western Sahara
-------------------------------------
13. (S) On the Maghreb, Ben Ali suggested extremism is a real and growing problem. Morocco, he said, was at the "beginning of the beginning" of its problem. It had ignored, he added, the issue for too long and former King Hassan II had refused to discuss it. Nevertheless, Morocco was a strategic partner for Tunisia and the GOT was working to strengthen cooperation. On Algeria, Ben Ali, said the problem was a "little better" and may be at the beginning of the end. Ben Ali said Tunisia has strong and direct cooperation on counter-terrorism with Algeria. Welch noted that Morocco and Algeria trust Tunisia more than they trust each other. Welch agreed that there is a terrorism problem in Morocco.
14. (S) On the Western Sahara, Ben Ali said the Algerians are responsible for the ongoing impasse. Welch agreed, saying the issue was blocking progress in the region. He said the Algerians need to accept that there is not going to be an independent state in the Western Sahara. Ben Ali said the problem is complex, and will take years to resolve. He added it cannot be settled through the UN Security Council. He noted Tunisia had tried to convene a Maghreb meeting on it in Tunis. While Morocco and Libya had agreed to attend, Algeria refused, saying there was nothing to discuss.
--------------
Iran: A Threat
--------------
15. (S) Welch noted that President Bush considered Iran a threat "yesterday, today and tomorrow." Noting the recent National Intelligence Estimate on Iran, Welch underscored that while the Iranians "may have put the gun in the closet, they are still trying to make the bullet." Nevertheless, he added, there are signs economic pressure is working. Ben Ali concurred. Welch said the chances of a third Security Council resolution are good and President Bush wants a diplomatic option.
16. (S/NF) Ben Ali replied this is "quite wise" of President Bush. He stressed he opposed the use of force, and that "a second front is not needed." Economic pressure on Iran will take longer, but it is working. Ben Ali added that he "does not trust" the Shia.
----------------------------------
Invitation: President Bush Welcome
----------------------------------
17. (S) President Ben Ali closed the meeting stressing his open invitation to President Bush to visit Tunisia before or after his time in office. Welch expressed his appreciation to Ben Ali for the meeting.
------------------------------
Comment: Warm and Open Ben Ali
------------------------------
18. (S/NF) Throughout the meeting, President Ben Ali was warm, open, and occasionally animated (at which point he sometimes slipped into Tunisian dialect). His quick and strong assurances on counter terrorism cooperation were welcome, and may be an important step forward on what has been a troubling issue. Significantly, the President's promise was followed within hours by action from GOT officials. The key test will be whether cooperation continues and is both broad and deep. Similarly, the President's commitment on Guantanamo detainees was welcome.
19. (S/NF) On regional issues, Ben Ali showed again that he is a moderate. While the Tunisians will not take the lead on foreign policy challenges, they will help where they can (e.g., support for the Annapolis process). Finally, President Ben Ali was clearly very pleased to see A/S Welch and to exchange views with him. The meeting and visit got broad, major media coverage in Tunisia. End Comment.
20. (SBU) A/S Welch did not have a chance to clear this cable.
GODEC
Permalink:https://tunileaks.appspot.com/?p=34001
]]>PP RUEHTRO
DE RUEHTU #0568/01 1491204
ZNY SSSSS ZZH
P 281204Z MAY 08
FM AMEMBASSY TUNIS
TO RUEHC/SECSTATE WASHDC PRIORITY 5057
INFO RUCNMGH/MAGHREB COLLECTIVE PRIORITY
RUEHAD/AMEMBASSY ABU DHABI PRIORITY 0976
RUEHAM/AMEMBASSY AMMAN PRIORITY 1367
RUEHDO/AMEMBASSY DOHA PRIORITY 0423
RUEHMK/AMEMBASSY MANAMA PRIORITY 0110
RUEHRH/AMEMBASSY RIYADH PRIORITY 2605
RUEHDE/AMCONSUL DUBAI PRIORITY 0157
Content
S E C R E T SECTION 01 OF 03 TUNIS 000568
SENSITIVE
SIPDIS
STATE FOR NEA/MAG (HARRIS)
STATE PASS USTR (BURKHEAD)
USDOC FOR ITA/MAC/ONE (NATHAN MASON)
CASABLANCA FOR FCS (ORTIZ)
CAIRO FOR FINANCIAL ATTACHE (SEVERENS)
LONDON AND PARIS FOR NEA WATCHER
E.O. 12958: DECL: 05/28/2018
TAGS: EFIN, EINV, KCOR, TS
SUBJECT: BEN ALI, INC. TAKES OVER A BANK
REF: A. TUNIS 365
B. 07 TUNIS 1433
C. 06 TUNIS 1673
D. 06 TUNIS 1672
E. 06 TUNIS 1630
F. 06 TUNIS 1622
TUNIS 00000568 001.2 OF 003
Classified By: Ambassador Robert F. Godec for Reasons. 1.4 (b) and (d).
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Summary
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1. (S) In the latest in a long string of questionable business deals, the Ben Ali clan has recently entered the banking business, assuming leadership of Tunisia's most profitable private bank -- Banque de Tunisie (BT). In April, Alya Abdallah, wife of Foreign Minister Abdalwahab Abdallah, became President of BT, replacing Faouzi Bel Kahia, the highly respected banker who held the post for 16 years.
According to an Embassy banking contact, Bel Kahia was forcibly removed to create an opening for Abdallah. Since taking office, Abdallah has replaced three members of the board -- two of them former ministers -- with insiders such as Belhassen Trabelsi, the President's brother-in-law and oft-cited as the ringleader behind Ben Ali clan corruption (Refs C, D, E, F). Abdallah also canceled a decision taken by shareholders to increase the number of shares. BT shares have fallen nearly 25 percent since the changes. End Summary.
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Mrs. Abdallah's Power Play
--------------------------
2. (S) Alya Abdallah, wife of Foreign Minister Abdelwahab Abdallah, was appointed President of Banque de Tunisie (BT) in April, replacing Faouzi Bel Kahia, the highly respected banker who held the post for 16 years. Abdallah was officially nominated by the board of directors and her position will be ratified by BT shareholders at the next general assembly. BT is Tunisia,s most profitable and best managed private bank. While most Tunisian banks remain saddled with non-performing loans, BT's assets are strong and 2007 net profits are expected to be in the neighborhood of 160 million dinars. Although Abdallah comes to BT from her position as chairman of the board at Union Internationale de Banque (UIB -- majority-owned by Societe Generale), Embassy contacts are quick to point out she is not qualified for either position.
3. (S) Prior to UIB, Abdallah's only banking experience was as the head of human resources at state-owned Societe Tunisienne de Banque (STB). As one contact, a former bank chairman himself, complained, "she has never been a banker and has no financial experience." Abdallah's tenure at UIB is reported to have been rocky, with stories of shouting matches between Abdallah and the French General Manager.
According to the former bank chairman, Abdallah asked Central Bank Governor Taoufik Baccar to get rid of the GM. The GM was asked to leave the country, which he did. Abdallah then asked Baccar for a new position, with her sights on Banque de Tunisie's presidency.
-------------------
Out With the Old...
-------------------
4. (S) Although BT and former president Bel Kahia enjoy excellent reputations in the Tunisian banking community, several factors made BT ripe for takeover. BT is fully private, but held by numerous small shareholders, with the largest stakeholder -- French Industrial and Commercial Credit (CIC) -- holding only 20 percent of the bank. Faouzi Bel Kahia is reportedly suffering from multiple sclerosis.
Although Bel Kahia's illness provided this opening, rumors indicate and an Embassy contact in the industry confirmed that Bel Kahia was pushed out. Bel Kahia had wanted to stay through the bank's General Assembly, during which BT's stellar 2007 profits will be reported. According to this contact, Bel Kahia was visited twice by Baccar: during the first visit Bel Kahia pleaded to stay, but during the second visit Baccar told him he was out, to which Bel Kahia is reported to have responded with tears. The contact noted that the level of the governor's intervention in this situation was unprecedented. Bel Kahia was rumored to have chosen a successor, who had already been approved by the board. While not currently involved in politics, Bel Kahia is a friend of the regime, serving previously as Minister of Transport and Director General of state-owned Tunisair.
Since assuming her new position, Abdallah has removed three members of the board -- Abderrazak Rasaa, former Deputy Minister of Finance, Ilyes Jouini, Professor at Dauphine University in Paris, and Tijani Chelli, a former Minister of Public Works, Minister of Telecommunications and Minister of Economy,
---------------
In With the New
---------------
5. (S) Although the departure of three notable board members is a surprise, it was one replacement in particular that drew the attention, and ire, of the Tunisian business community.
Abdallah named Belhassen Trabelsi, the President's brother-in-law and widely believed to be the key player in Ben Ali clan corruption, to the bank's board of directors and also to the credit committee. Trabelsi has reportedly been involved in a wide range of corruption schemes -- with stories ranging from him setting up shop in a gas station across from the airport to facilitate customs shipments in return for large bribes and to expropriating property at will from hapless homeowners. In February, Trabelsi began buying huge numbers of BT shares (20,000 a day), drawing attention to his interest in the bank. His current stake in BT is unknown. In addition to Trabelsi, Lotfi Hamrouni, chairman of the Hamrouni Group, and Ali Bakir, SFBT (Tunis Refigeration and Brewing Company) -- Tunisia's Coca-Cola bottler, were named to the board.
6. (S) In addition to changing the composition of the board, Abdallah cancelled a communique issued by the shareholders prior to her arrival. The shareholders signed a Pacte d'Actionnaires to double their shares and increase bank capital. The former banker characterized the pacte as an effort by shareholders to protect their influence within the bank. BT shares have fallen 25 percent since Abdallah cancelled the communique. The former bank chairman noted that control of BT is a significant boon to the family, giving them a financial tool at their disposal with which they can acquire and finance new ventures. As such, bank performance is a secondary concern.
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Comment
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7. (S) Tunisia's financial sector is already plagued by high-levels of non-performing loans, many of which are a result of corrupt banking practices. Belhassen Trabelsi's position on any bank board, or credit committee, would be significant cause for concern. In the case of BT, his participation jeopardizes the integrity of Tunisia's premiere banking institution. Moreover, the Central Bank Governor's involvement in this scenario casts doubt on his ability or willingness to serve as an independent actor. Serious efforts at banking sector reform were just dealt a heavy blow.
8. (S) Tunisians are unable to complain publicly, but do so loudly in private about crony capitalism and ill-gotten gains. Rumors of familial corruption have become widespread in Tunisia, with Banque de Tunisie just one of many examples.
Despite their frustration, many Tunisians are quick to absolve Ben Ali of any direct responsibility and lay the blame squarely on the Trabelsis. Yet, claims that he is unaware of the situation strain credibility. GOT insiders and the President's extended family are reaping the benefits from Ben Ali's continued reign, but in doing so have undermined the effectiveness and credibility of the government. Even if the money is not flowing into Ben Ali's bank account, he bears responsibility for what happens on his watch. The economic impact is clear, with Tunisian investors fearing the long-arm of the family -- forgoing new investments, keeping domestic investment rates low and unemployment high (Refs A, B). Faced with high unemployment and high prices, Tunisians are simultaneously confronted with obvious corruption and conspicuous displays of wealth. The frustration is palpable, but it appears there is no end in sight. End Comment.
Please visit Embassy Tunis' Classified Website at: http://www.state.sgov.gov/p/nea/tunis/index.c fm
GODEC
Permalink:https://tunileaks.appspot.com/2010/11/29/ben-ali-inc-takes-over-a-bank.html
]]>DE RUEHTU #0314/01 1411714
ZNY SSSSS ZZH
P 211714Z MAY 09
FM AMEMBASSY TUNIS
TO RUEKJCS/SECDEF WASHINGTON DC PRIORITY
RUEHC/SECSTATE WASHDC PRIORITY 6315
INFO RUCNMGH/MAGHREB COLLECTIVE PRIORITY
Content
S E C R E T TUNIS 000314
NOFORN
SIPDIS
DOD FOR OSD (DASD WHELAN) AND OSD/ISA/NESA
STATE FOR PM/RSAT(DANIELEWSKI) NEA/MAG (HAYES)
E.O. 12958: DECL: 05/21/2019
TAGS: MASS, MARR, PREL, TS
SUBJECT: US-TUNISIAN JOINT MILITARY COMMISSION PRODUCES BETTER TUNISIAN BRIEFINGS BUT MANY DETAILS STILL LACKING
Classified By: Ambassador Robert F. Godec for reasons 1.4 (b) and (d)
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Summary
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1. (C) The May 11-13 US-Tunisian Joint Military Commission (JMC) saw productive exchanges on a variety of topics relating to bilateral military cooperation. The Tunisians were more forthcoming than they have been in recent years about their priorities with respect to military assistance needs, although they did not provide a comprehensive planning document laying out these priorities in detail and how they intendto use Foreign Military Financing (FMF) and other means to meet them. In the coming weeks, the Mission will review FMF and other US assistance here in light of the JMC and other developments in US-Tunisian bilateral relations, including issues related to the American Cooperative School of Tunis. End Summary.
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Setting the Stage
-----------------
2. (C) On May 7, prior to the formal commencement of the 24th US-Tunisian JMC, DASD Whelan met with Defense Minister Morjane. In this meeting, both Morjane and Whelan expressed appreciation for the long-standing military cooperation between our two countries, noting our historic relationship and friendly ties. Morjane was particularly grateful for the provision of ground surveillance radar (GSR) and unmanned aerial vehicles (UAVs), which will help the Tunisian military patrol the border. Whelan made clear that the United States Government was pleased to be able to help Tunisia better secure its borders. She noted, however, that the current economic environment would have an impact on foreign assistance. "We may not be able to sustain" current levels of military assistance to Tunisia, she explained.
3. (C) DASD Whelan underscored that the economic crisis made it all the more important for th USG to understand Tunisian military needs and prorities, explaining that such information is criical to US planning and delivery of military assstance. In addition, she addressed the need to ave regular communications, to ensure that the US-unisian military partnership stays strong and effctive. (Note: She did not specifically mention S disappointment or the conditions imposed by he GOT on the ATLAS DROP exercise, but it was clar that this incident was symptomatic of the problem to which she was alluding.) Morjane agreed, bu noted that Tunisia's relatively small military mposes constraints on the number of commitments hat they can take on. He specified that Tunisiahas 11 joint military commissions with various cuntries, including one just created with Belgium nd noted that during the last year the Tunisian ilitary had taken part in over 300 military actiities, including 100 days, worth of activities wit the United States. Whelan said the United Stats was interested more in the quality of the relationship, rather than the quantity of joint activities.
4. (S/NF) Follown their 30-minute meeting, DASD Whelan and DefMi Morjane adjourned to his office for a restricted meeting, which also included Ambassador Godec on he US side;
and Director General for Military Seurity Brigadier General Mohamed Meddeb, Colonel bdelkader Adouni, and Major Chiheb Khelifa on theTunisian side. Morjane and Whelan repeated the hemes addressed in the broader meeting, with Whela underscoring that the USG needs more precision bout Tunisia's requirements to better guard against the threat posed by al-Qaeda in the Islamic Maghreb. General Meddeb opined that better military-military intelligence cooperation would help. He recalled that in the 1980's the United States used to provide daily updates about Soviet ship movements in the Mediterranean, suggesting that this kind of information-sharing was an appropriate model. Whalen said the US side would seek to strengthen this area.
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Productive Working Sessions
---------------------------
5. (C) The JMC itself proceeded as planned, with positive but quite general exchanges in the plenary, with more detailed briefings in the Subcommittees on Security Assistance and on Military Cooperation. (Note: The minutes of these sessions have been emailed to PM/RSAT and NEA/MAG.) US participants
described the Tunisian briefings as "more forthcoming than ever," but still not quite reaching the level of precision that the US side requires for planning purposes.
Specifically, the Tunisians did not provide a comprehensive five-year planning document laying out in detail their military assistance priorities and how they intend to use FMF and other means to meet them.
6. (SBU) Highlights of the working sessions included:
-- A briefing on the Tunisian Army's top military assistance priorities, i.e., light weapons, individual protection, NVDs, GPS, laser range finders, aiming point devices, HWMMW and shelters, chemical gear, EOD gear, parachutes, and support vehicles.
-- A briefing on the Tunisian Air Force's top priorities, i.e., upgrading F5 and T53 engines and C130 pilot training.
Secondary priority was given to EDA C130H and SH-60, J85-21C engines for the F5 and T56 engines for C130, sustainment of the UH-1, upgrade for the C130B, a UH-1H simulator, and initial pilot training for graduating cadets.
-- The Tunisian side also requested as a top priority two Protector Class (or equivalent 25 meter) coastal patrol boats, which the Tunisian military intends to supplement with an additional two coastal patrol boats by FY12.
-- The Tunisian side briefed on the Tunisian medical organization, requesting US assistance for its intensive care unit and burn unit, as well as in the area of aerospace physiology.
-- The Tunisian side briefed on the military's civilian development/engineering project in R'Jim Maatoug, located south of Kebili. Both in Morjane's plenary statement and in the more detailed briefing in the military cooperation subcommittee, the project was held up as a model for potential US-Tunisian cooperation in humanitarian assistance.
The US side expressed openness to considering future projects in conjunction with the Tunisian Ministry of Defense along the lines of the R'Jim Maatoug project, which the Italians helped fund.
-- On the US side, the Tunisians welcomed the briefing on the Scan Eagle Unmanned Air System, noting that a site survey by the US program office would be required to better assess support requirements. After repeated requests, the Tunisians permitted a site visit along the Tunisian-Algerian border to review issues related to deployment of GSRs and UAVs. The Tunisians were invited to observe as part of AFRICOM's mil-mil program the US Marine Corps exercise Mohave Viper at 29 Palms training area in California June 1-4, 2009 where USMC employs Scan Eagle UAV as part of its predeployment training. (Note: The Tunisian Military accepted this offer on May 20, sending the Embassy the names of two Air Force officers.)
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Comment
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7. (C) Although the session was productive, and the Tunisian side more forthcoming than it has been in recent years about its priorities with respect to military assistance needs, there was still an absence of precision in some of the Tunisian briefings. In the coming weeks, the Mission will review FMF and other US assistance here in light of the JMC and other developments in US-Tunisian bilateral relations, including the future of the American Cooperative School of Tunis. End Comment.
8. (SBU) DASD Whelan did not have a chance to clear this cable prior to departing Post.
Please visit Embassy Tunis' Classified Website at: http://www.state.sgov.gov/p/nea/tunis/index.c fm
Godec
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