Viewing cable 09BRASILIA1239, HANDLING VISA REQUEST FROM BRAZILIAN INVOLVED IN THE 1969 KIDNAPPING OF THE U.S.

VZCZCXRO2382
OO RUEHRG
DE RUEHBR #1239/01 2881748
ZNY SSSSS ZZH
O 151748Z OCT 09 ZDS
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 5218
INFO RUEHRG/AMCONSUL RECIFE IMMEDIATE 0017
RUEHRI/AMCONSUL RIO DE JANEIRO IMMEDIATE 8278
RUEHSO/AMCONSUL SAO PAULO IMMEDIATE 4644
RHMCSUU/FBI WASHINGTON DC
S E C R E T SECTION 01 OF 04 BRASILIA 001239

C O R R E C T E D COPY - ADDING ADDRESSEE

NOFORN
SIPDIS

DEPARTMENT FOR WHA AND CA

E.O. 12958: DECL: 10/14/2019
TAGS: PREL PTER CVIS BR
SUBJECT: HANDLING VISA REQUEST FROM BRAZILIAN INVOLVED IN THE 1969 KIDNAPPING OF THE U.S.

AMBASSADOR BRASILIA 00001239 001.2 OF 004

Classified By: Charge d' Affaires, a.i. Lisa Kubiske, reason: 1.4 (b) a nd (d)

¶1. (U) This is an action request--see paras 2 and 10. 2. (C) Summary and Action Request: Consulate General Sao Paulo on October 6 issued a visa to Paulo de Tarso Venceslau, who after the fact was identified in Brazilian media as one of the kidnappers of the U.S. Ambassador to Brazil in 1969, sparking speculation of a change in U.S. policy toward the former guerillas under the Obama Administration. CG Sao Paulo, which still has possession of Venceslau,s passport, reports that Venceslau omitted disclosure of his arrest and imprisonment for his involvement in the kidnapping on his visa application. Cancellation of the visa, which would be the standard course of action, will likely lead to significant and negative reaction in the Brazilian media at a time when both official Brazilians and the public are considering new possibilities for U.S.-Brazil relations. In light of the distance from the crime, the circumstances under which it took place, and our desire for a forward-looking relationship, now might be the time to consider waiving ineligibilities. At the same time, issuance of a visa, with attendant waiver of ineligibilities, would set a precedent for others who participated in the kidnapping, including a prominent federal deputy and a government minister, and might have implications for broader U.S. policy and messaging on terrorism. CG Sao Paulo will interview Venceslau on Monday, October 19. Mission requests urgent guidance from the Department on whether to undertake discussions with Venceslau that might allow us to recommend a waiver of ineligibilities. End summary.

--------------------------------------
U.S. AMBASSADOR KIDNAPPER IS ISSUED VISA, RUNS TO PRESS --------------------------------------

¶3. (C) CG Sao Paulo on October 6 issued Venceslau a B2 tourism visa after no hits of any kind appeared on all iterations of his name. Venceslau did not indicate on question 38 of his DS-156 application that he had "ever been arrested or convicted of any offense or crime, even though subject of pardon." The visa was processed and placed into the passport, but CG Sao Paulo remains in possession of the passport.

¶4. (U) Reports in the October 9 and 10 Estado de Sao Paulo and O Globo newspapers announced that Venceslau, after years of frustrated attempts, had finally been issued a visa for entry into the United States. Venceslau was quoted as saying, "I never have had a great love for the United States," but that he had always had an interest in seeing the life and culture in the cities of New York, Chicago, and New Orleans. Venceslau said he had tried three time in the last four decades to get a visa at the Consulate in Sao Paulo but was denied for being considered "a terrorist." Venceslau told the paper that he immediately told old friends about his "victory," including fellow kidnappers Fernando Gabeira (a federal deputy from Rio de Janeiro) and Franklin Martins (Lula,s Minister of Social Communications at the presidency). Gabeira claimed to also have tried repeatedly, but with no success, to obtain a visa and celebrated Venceslau,s news by saying "this shows that the United States is looking forward, leaving behind the animosities of the past century" and joked "I thought this would only happen with the President serving during the 100th anniversary of the kidnapping." Martins said that while he is not considering applying for a visa right now, he will consider the idea. One article reports that Venceslau is due to receive his passport and visa this week and that Venceslau is not worried since "Obama just received the Nobel Peace prize. It would look bad if he cancelled my passport." Another newspaper reported Venceslau as saying "my only fear is that there was been a mistake and that the Consulate will cancel my visa. I would like to listen to jazz in Chicago but I don,t believe in miracles."

-------------------------------------- THE 1969 U.S. AMBASSADOR KIDNAPPING AND PERPETRATORS --------------------------------------

¶5. (U) U.S. Ambassador to Brazil Charles Elbrick was kidnapped on September 4, 1969 by a Brazilian guerilla group named Dissidencia Comunista Universitaria da Guanabara (Communist Dissidence of the University of Guanabara) DI/GB. Their goal, in which they succeeded, was to exchange the U.S. Ambassador for the release of 15 political prisoners detained by the military government then in power. One of the 15

BRASILIA 00001239 002.2 OF 004

prisoners released was Brazilian President Lula,s former Chief of Staff, Jose Dirceu, who served under the first Lula administration but had to resign after his involvement in the "mensalao" (vote-buying) scandal in the Congress. During the kidnapping, in an attempt to humiliate the military, they called themselves the MR-8, which was a guerilla group the military had recently boasted in the press it had extinguished. They chose the U.S. Ambassador because he represented "imperialist and North-American interests in our country." Ambassador Elbrick was released on September 7 having suffered minor head trauma from being pistol whipped during the kidnapping.

¶6. (S//NF) According to press reports and FBI archive records, Paulo de Tarso Venceslau helped plan the details of the kidnapping, was one of the passengers in the vehicle used to block the Ambassador,s car, subdued the Ambassador,s driver, and was one of the kidnappers who boarded the Ambassador,s vehicle and took him into hiding. While the Ambassador was held, Venceslau helped put together the list of 15 political prisoners the group demanded be released. On October 1, 1969 Venceslau was caught and imprisoned, without trial, for his involvement in the kidnapping, according to press reports. He was released in December 1974. Since leaving prison he has been a leader in the PT (Worker,s Party), worked for the city of Sao Paulo, and secretary for the mayor,s office of Sao Jose dos Campos, Sao Paulo, and Campinas. He is currently a businessman in the field of communications. Venceslau was also put in jail for two to three days in September 1966 for participating in illegal student protests, according to press reports.

¶7. (S//NF) Most of the 12 kidnappers were convicted and imprisoned within one year of the kidnapping. Following is information available to post on the other identified kidnappers and drawn from press reports and FBI archive records:

-- Franklin de Souza Martins: Was one of the chief architects of the kidnapping plot. Two months after the kidnapping he fled to Cuba for guerilla training and only returned to Brazil in 1973. He was never imprisoned. He is currently serving in the Lula administration as the Minister of Social Communications in the presidency, and has been discussed in the press as a close advisor to Dilma Rousseff in her anticipated run for the presidency next year. Based on personal interest from President Lula, the Brazilian Ministry of Foreign Relations (MRE) has intervened on his behalf in an attempt to secure Martins a visa for entry into the United States.

-- Cid Queroz Benjamin: Was one of the kidnappers in the car that blocked the Ambassador,s vehicle. He was imprisoned in April of 1970; he only served two months because he was released as part of an exchange for the kidnapped German Ambassador.

-- Vera Silvia Araujo de Magalhaes: Seduced the chief of security at the Ambassador,s residence to obtain information about the Ambassador,s car and schedule. She was imprisoned in February of 1970 and was released four months later as part of an exchange of the kidnapped German Ambassador.

-- Fernando Gabeira: Rented the house in which the Ambassador was hidden during the kidnapping. He wrote the document that was left in the Ambassador,s car after the kidnapping. He was in the house when the Ambassador was brought there and took the Ambassador,s messages to his wife and delivered the list of the 15 political prisoners demanded in the exchange for the Ambassador. He was shot by police and imprisoned in January of 1970. He was also released during the exchange for the kidnapped German Ambassador. Gabeira, who has publicly repudiated his role in the kidnapping and has been critical of hostage-taking by the FARC, is a prominent federal deputy from Green Party in Rio de Janeiro.

-- Manoel Cyrillo de Oliveira Netto: Was the second in command of the kidnapping operation and was one of the subjects who physically kidnapped the Ambassador in his car. He was imprisoned on September 31, 1969 and spent 10 years in jail.

-- Sergio Rubens de Araujo Torres: Drove the car that followed and help trap the Ambassador,s car.

-- Joao Lopes Salgado: Was never imprisoned but lived in exile outside of Brazil until 1980. He provided cover for the

BRASILIA 00001239 003.2 OF 004

vehicles that were used in the kidnapping.

-- Claudio Torres da Silva: Drove all of the vehicles used to transport the kidnapped Ambassador, both during the kidnapping and for his release. He was the first of the kidnappers to be caught and jailed on September 9, 1969, and was released in 1977.

-- Jose Sebastiao Rios de Moura: Was the watchman during the kidnapping who signaled the Ambassador,s departure from his residence. He went into exile and only returned to Brazil in 1980. In 1983 he was shot dead by two men in suits and hats on his way home.

-- Joaquim Camara Ferreira: Was the chief negotiator with the government during the kidnapping and stayed the entire time in the house with Ambassador Elbrick. He was imprisoned on October 24, 1970 and died hours later while being tortured.

-- Virgilio Gomes da Silva: Served as the chief commander of the kidnapping operation. He was caught on September 29, 1969 and died the following day during a torture session.

-------------------------------------- POTENTIAL IMPLICATIONS AND REQUEST FOR ACTION --------------------------------------

¶8. (C) CG Sao Paulo and Embassy Brasilia are in contact separately with CA regarding the technical and legal aspects of potential ineligibilities. CG Sao Paulo has an appointment to interview Venceslau regarding these ineligibilities, and particularly to verify reports (not officially confirmed) that he was arrested and convicted of the crime, which he did not acknowledge on his visa application (Note: In an initial conversation with CG Sao Paulo on October 14, Venceslau claimed that, as his crime was "political," he was not obligated to do so "under Brazilian law." End note.)

If available information is correct, at a minimum he appears to be ineligible under Section 212(a)(2)(A)(i) for Conviction of Crimes Involving Moral Turpitude, as well as 6C1 for misrepresenting a material fact. Other ineligibilities may apply.

¶9. (C) Beyond the question of ineligibilities, Mission sees broader implications resulting from a decision to either cancel the visa with no additional action, or to pursue a waiver. In our view, a minimum bar for granting Venceslau a waiver would be public repudiation of the crime and of kidnapping as a tactic. We have no evidence that Venceslau has made such a renunciation and would have to seek it from him. Assuming he were amenable to such a renunciation, issuance of a visa to Venceslau upon receipt of a waiver would set a precedent related to other kidnappers, at least two of whom (Gabeira and Martins) are likely to apply in the near future. While Gabeira has publicly renounced kidnapping as a form of expression and has criticized the FARC for engaging in kidnapping, Martins has pointedly refused to express remorse for his actions, explaining that they were in the context of a worthy political struggle. Mission also sees potential implications in issuing the visa for broader U.S. policy and messaging on terrorism, especially with regard to USG officials.

¶10. (C) At the same time, with the new U.S. Administration, both Brazilian officials and the public are considering new possibilities for bilateral relations. President Obama,s statements at the April Summit of the Americas regarding his desire to build a new relationship with Latin America that looks forward, rather than backward, resonated strongly in Brazil. Although cancelation of his visa will be straightforward as a consular matter, it is likely to generate significant negative press that calls into question whether U.S. policy toward Latin America has changed, and to have repercussions in official circles where a number of senior officials and elite are linked to the case either directly (e.g., Gabeira and Martins) or indirectly (e.g., Human Rights Minister Paulo Vannuchi, who is linked with Venceslau as a political prisoner, and senior PT official Jose Direceu, who was released by the military government as a result of the kidnapping). When considered with the fact that 40 years has passed since the kidnapping and the political nature of the opposition to the military regime, these factors suggest pursuing a waiver of ineligibilities as a way to promote a forward-looking bilateral relationship.

¶11. (C) Action request: In light of the political and media sensitivities, Mission requests guidance from the Department

BRASILIA 00001239 004.2 OF 004

on an urgent basis, and ideally prior the October 19 meeting with Venceslau, as to whether to initiate discussions with Venceslau that might allow for a recommendation to waive ineligibilities.

KUBISKE

Italian Newspaper Provokes Rage in Baku

Azerbaijan is grappling to come to terms with a fresh Internet news scandal. This one doesn’t concern pesky domestic bloggers who tweak government sensitivities. And it is not about media rights. Rather, it covers a topic generally given a wide berth in Baku, even by Azerbaijan’s political opposition -- First Lady Mehriban Aliyeva.

Aliyeva over the past few weeks has become the subject of unprecedented coverage in foreign newspapers. First, the right-wing Italian daily Il Foglio published an article December 3, using unnamed diplomats as sources, alleging “informal meetings” of a possibly romantic nature occurred in Berlin between Aliyeva and Belorussian President Alexander Lukashenko. Then, on December 12, a British daily, The Guardian, published a story about a WikiLeaks cable, reportedly prepared by a US Embassy staffer in Baku, describing the political influence and business interests of Aliyeva’s family, and speculating about the First Lady’s possible use of plastic surgery.

The Il Foglio allegations, accompanied by a photo gallery entitled “Too Beautiful for a First Lady,” seem tabloidish in making a preposterous claim. Among foreign readers the report appeared to inspire no more than a shrug of the shoulders. But in Azerbaijan, where the First Lady’s image is sacrosanct, it has struck a raw nerve.

Azeri culture does not tolerate public discussions of a man’s wife; that rule takes on even greater weight where the glamorous 46-year-old wife of President Ilham Aliyev is concerned. While opposition media outlets may daily criticize the president and government, very rarely do they dare write anything negative about the First Lady.

That means the Italian newspaper report shocked many Azerbaijanis. Even though no Azerbaijani media outlet has reprinted or written about the Il Foglio article, the story’s publication has become one of the hottest topics of discussion in the Azerbaijani capital. Baku residents have been able to slake their thirst for rumor and innuendo by accessing Russian-language translations that have appeared in Russian and Armenian online media since December 8.

The government was quick to respond. In a December 9 statement about the Il Foglio story, the First Lady’s protocol service expressed “extreme indignation with the slanderous insinuations published in Il Foglio, which discredit Mehriban Aliyeva’s honor and dignity.” Calling the report libelous, the service speculated that “some forces which are not interested in the growing prestige of our country and the international authority of Azerbaijan’s first lady” had planted the article. It has demanded a public apology and a full retraction by Il Foglio. Italy, it should be noted, has strong energy ties to Russia, while Moscow and Baku are backing competing energy-export pipeline projects in the Caspian Basin.

Representatives of Il Foglio, based in Milan, did not respond to requests from EurasiaNet.org for comment.

While many Azerbaijanis -- regardless of their political loyalties -- dismiss the allegations as “a dirty load of rubbish” or “simply impossible,” only a few media outlets have even published the statement from Aliyeva’s protocol service. Those that did, published it without any reference to the article in question.

As a member of parliament, deputy chairperson of the governing Yeni Azerbaijan Party, a goodwill ambassador for UNESCO and the Organization of Islamic States, and head of the charitable Heydar Aliyev Foundation – no other woman in Azerbaijan has such a prominent -- and uniformly positive -- public image.

To suggest otherwise is to risk incurring the wrath of President Aliyev, who is known among Azerbaijani journalists for having greater tolerance for public criticism of himself than of his family. A 2010 story by The Washington Post about multi-million-dollar property in Dubai allegedly owned by the president’s 13-year-old son, Heydar, has been cited as contributing to a flare-up of tension in Azerbaijani-US relations.

While Il Foglio has caused a stir for touching on what is seen as President Aliyev’s personal honor, the WikiLeaks information, provided via The Guardian, has not.

The alleged 2010 US embassy cable, which has been republished in some Azerbaijani media outlets, names the First Lady’s family, the Pashayevs, as “the single most powerful family in Azerbaijan,” with holdings in construction/real estate and the financial and telecommunications sectors. The family, it claims, uses “government mechanisms” to keep out business competitors, while maintaining de facto control of certain ministries -- including Culture and Tourism, Youth and Sport, Health, and Education -- that are seen as under the First Lady’s domain.

It describes the First Lady as an MP never seen in parliament and a person “poorly informed about political issues.” It also ventures into criticism of her appearance. A fashionista who has been photographed for Russian Vogue and Harper’s Bazaar, Aliyeva, the cable reported, “appears to have had substantial cosmetic surgery” and cannot display “a full range of facial expression.” Her dresses were deemed “provocative even in the Western world.”

The Azerbaijani government has earlier dismissed the WikiLeaks releases as untruthful, and is expected to raise the matter privately with US officials. As with the Il Foglio article, any allegation made against the First Lady herself is not considered a matter appropriate for public debate in Baku.

The public focus on the Il Foglio report is continuing. Explanations for why the article appeared vary from Russian revenge for previous WikiLeaks disclosures about President Aliyev’s criticism of Russian President Dmitry Medvedev and Prime Minister Vladimir Putin, to a “provocation” from “the Armenian lobby.”

Individuals asked about their reactions to the article declined to be named. One Baku-based political analyst, who also requested anonymity, believes that the government will use all possible official and unofficial means to make Il Foglio apologize publicly. “It is known that Ilham Aliyev hates when the media writes negatively about his family, but, in this case, it is really a personal offense, which is inexcusable in Azerbaijan,” the analyst said.

BP accused of 'mild blackmail' by Azerbaijan during winter gas shortage

Tuesday, 05 December 2006, 15:44
C O N F I D E N T I A L SECTION 01 OF 03 BAKU 001771
SIPDIS
SIPDIS
DEPT FOR DAS BRYZA
EO 12958 DECL: 12/04/2016
TAGS ENRG, GA, PGOV, PREL, TU, AJ
SUBJECT: AZERBAIJAN: PRESIDENT ALIYEV ON UPCOMING GAS
TRILATERAL
REF: BAKU 1720
Classified By: Ambassador Anne E. Derse, Reasons 1.4 (b,d)

1. (U) ACTION REQUEST: Please see Paragraph 10.

2. (C) SUMMARY: President Aliyev told the Ambassador on December 5 that he expected the December 8 Trilateral meeting of Energy Ministers in Tbilisi to "clarify" whether Turkey was willing to help Georgia with its winter gas problems. He said Azerbaijan would host a subsequent December 14 meeting in Baku among Azerbaijan, Georgia and Turkey, plus BP and Statoil. Aliyev again blamed BP for linking commercial issues to the current gas problems, and reported that "nothing had changed" in Azerbaijan,s gas negotiations with Russia during Russia PM Fradkov,s visit to Baku. END SUMMARY.

3. (C) On December 5 the Ambassador met with President Aliyev and discussed both energy and press freedom issues (septel). Energyoff was notetaker.

Russian PM Fradkov Visit Readout

--------------------------------------------

4. (C) Concerning the just concluded visit to Baku of Russian Prime Minister Mikhail Fradkov, Aliyev said that "nothing had changed" concerning the Gazprom offer of gas to Azerbaijan at 1.5 billion cubic meters (bcm) at USD 230 per thousand cubic meters (mcm). Aliyev said that Russia knows Azerbaijan will not buy at this price, which would be more expensive than Azerbaijan's burning mazut in its power plants. Aliyev said that he did not even seek to raise the issue with Fradkov, but that Fradkov had broached it. Aliyev said that Fradkov contended that the Gazprom offer was not "anti-Azerbaijan," and was purely a commercial decision, but Aliyev added that Gazprom's sales of gas to Ukraine at USD 130 per mcm belies this claim. Aliyev said that Russia justifies its lower gas sales price to Armenia by its being Armenia's close ally and by purchase of the Iran-Armenia gas pipeline, by which, he said, Russia seeks to control strategic future gas export routes to Europe. Russia was trying to "circle the European gas market," which also was influencing its negotiations with Belarus, but here too there has not been an agreement on sales price.

5. (C) Aliyev said that Fradkov also proposed that Russia could help Azerbaijan in transporting its gas to third countries, although Aliyev told the Ambassador his response was that he did not see how such 'help' would be possible. Fradkov told Aliyev that Russia was going to need more gas for domestic use, which would reduce volumes it could sell to Europe. Aliyev said that Russia was working with Algeria to form a gas monopoly.

Gas Trilat

------------

6. (C) The Ambassador said she knew that Aliyev had had a good discussion with DAS Bryza on energy issues in Minsk and with Georgian PM Noghaideli when he visited Baku on November 30, and that based on the latter meeting there was going to be a trilateral meeting of the Turkish, Georgian and Azerbaijani Energy Ministers in Tbilisi on December 8. Aliyev said Georgian and Azerbaijan shared a common strategic vision on energy issues, would be coordinating closely in this regard, and as such, during Noghaideli's December 4-14 visit to the United States he would be delivering an Azerbaijani message as well as a Georgian one (Comment: The Georgian Ambassador told the Ambassador on December 5 that in his US visit Georgian PM Noghaideli would ask Secretary Rice and Vice-President Cheney to "encourage" BP to help this winter). Aliyev said that he had expected the Turkish and Georgian governments to have had positive discussions prior to Noghaideli's November 30 visit to Baku but that this did not happen, and that the answer Georgia received from Turkey at that time concerning redistribution of Shah Deniz gas was negative, and contrary to the common understanding arrived at in July 2006 among the leaders of the three countries.

BAKU 00001771 002 OF 003

Aliyev said he felt that "the Turkish approach was not sincere," and as such Azerbaijan and Georgia needed to coordinate tactics and strategy. At a recent high-level meeting of his government Aliyev said he stressed his commitment to the longer-term strategic project of delivering Caspian gas to Europe and that "Azerbaijan should not sacrifice its long-term energy strategy for day-to-day needs." Azerbaijan's strategic goal, which Aliyev said was currently more important for Europe than it was for Azerbaijan, was to enter European markets. Putin is saying that Azerbaijan and Kazakhstan cannot supply gas to Europe - "if we don't do it, we lose the battle." As such, Azerbaijan has put forward the best possible solution for the short-term gas crunch: some gas for Georgia, some for Turkey, some for Azerbaijan, and some for Greece.

7. (C) The Ambassador said that the Georgians have been led to believe that the Turkish government is going to be more positive in the December 8 Tbilisi meeting, although she could not confirm this assessment (Comment: the Georgian Ambassador told the Ambassador on December 5 that Georgia's Embassy in Ankara has reported that the Turkish Foreign Ministry is saying that Turkey is now ready to discuss redistributing its 2007 Shah Deniz gas volumes) . She said that DAS Bryza has suggested that after the December 8 trilateral, it might be useful to have another trilateral meeting on December 14 in Baku with the inclusion of BP and Statoil, and she asked the President for his opinion. Aliyev said that "we don't have time to wait," noting that the winter holidays were fast approaching. He said he approved the proposed December 14 meeting -- trilateral plus BP and Statoil -- and would be willing for Baku to host it. He added that he had wanted Baku to host the December 8 meeting, but deferred to the Georgian desire to have it in Tbilisi. He said USG involvement in the December 14 meeting would be useful. He said that the December 8 Tbilisi meeting would be very important as it would 'clarify' the Turkish position, i.e. whether they were willing to help, and that the December 14 meeting would be similarly important as it would clarify whether BP was willing to help.

BP's Dangerous Game

----------------------------

8. (C) Aliyev said that BP could deliver more associated gas from the ACG field to Azerbaijan for domestic use, but that it was linking its cooperation in this regard with its desire to extend its Production Sharing Agreement (PSA) with Azerbaijan to develop ACG deep gas. Aliyev said it was inappropriate for BP to link all of its issues such as PSA extension, ACG deep gas, transportation tariff agreements and others into one bundle; it also was inappropriate for BP to link the solution of those issues to Azerbaijan's "temporary troubles." He said that BP was using "mild blackmail" and argued that BP must instead act in good faith. Aliyev said that he had instructed his officials to tell BP that if it were not "supportive" with ACG associated gas, it would not get its way with PSA extension and ACG deep gas. "If BP won't give us more ACG associated gas, I have instructed our officials to tell them no PSA extensions or ACG deep gas," Aliyev underscored. He said that he did not want this to happen, since from an economic viewpoint both the AIOC Consortium and Azerbaijan would benefit from extending the PSA and for the Consortium being the ones to develop ACG deep gas. But it was not just Azerbaijan, but also Europe and Georgia who had a stake in this issue. Aliyev concluded by saying that if Turkey agreed to redistribute its 2007 Shah Deniz gas that "would almost be the way out," but that then Azerbaijan would still need BP support in both redistributing this Shah Deniz gas and also in giving Azerbaijan more ACG associated gas.

9. (C) The President also mused that "we could cut the gas supply to Turkey" if need be. The Ambassador pointed out that this would be an extreme measure with serious repercussions. She asked Aliyev if he knew the reasons for Turkish truculence concerning gas redistribution. He said he did not, but suspected it could be monetary, i.e. buying gas at USD 120 per mcm and selling it at USD 230. He also

BAKU 00001771 003 OF 003

conjectured that Turkey could be under serious pressure from Russia.

10. ACTION REQUEST: Ambassador will meet with BP Azerbaijan President Bill Schrader December 8. Department's guidance, particularly information on the message being delivered to BP officials in Washington, is requested. DERSE

WikiLeaks Cable Compares Ilham Aliyev to Movie Mafia Bosses

A diplomatic cable dispatched by the US Embassy in Azerbaijan, part of the cache of documents obtained by the WikiLeaks website, compares Azerbaijani President Ilham Aliyev to two iconic mafia dons from “The Godfather” movie trilogy -- impulsive Sonny Corleone and his brother, the coldly calculating Michael. The cable goes on to suggest that the dual-nature of the Azerbaijani leader often places “US interests” in opposition to “US values.”

It would seem that few heads of state would welcome a public comparison to criminals, whether real or imagined. But so far, the US cable -- purportedly written in September 2009 by Washington’s then senior diplomat in Baku, former deputy chief of mission Donald Lu -- has largely passed unnoticed. The document, classified as secret, was posted on WikiLeaks’ Cable Viewer site on December 1.

Citing “some observers,” the cable states that Aliyev’s foreign policies show his “Michael Corleone” side; they are marked by “pragmatism, restraint and a helpful bias toward integration with the West,” the document reads. His domestic policies, however, particularly on the 2009 imprisonment of bloggers Emin Milli and Adnan Hajizade, illustrate his inner “Sonny Corleone,” the dispatch claims --“increasingly authoritarian and hostile to diversity of political views.”

“[T]his Michael/Sonny dichotomy complicates our approach to Baku and has the unfortunate effect of framing what should be a strategically valuable relationship as a choice between US interests and US values,” the alleged cable reports.

“The dissonance between Aliyev's sensible approach to foreign affairs, manifested by the cosmopolitan image he presents to Western visitors, with his tailored suits and flawless English, and the unpleasant reality of his approach to domestic issues raises the obvious question of how these two realities coexist,” the document continues.

Azerbaijani media do not appear eager to seek answers to that question. Pro-opposition media are still focusing on earlier releases about Aliyev’s alleged remarks about Turkey, Iran and Russia. Pro-government media outlets, meanwhile, are keeping silent, focusing their attention on another alleged US dispatch that threatens sanctions against Armenia for reportedly shipping arms to Iran.

After issuing a statement November 30 that dismissed the WikiLeaks disclosures as “a clear provocation aimed at damaging Azerbaijan’s relations with neighboring countries,” the presidential press office has not commented. Similarly, the US Embassy to Baku has declined to “comment on documents which pretend to contain classified information.”

Even so, “The Godfather” analogy “does not promise anything positive for US-Azerbaijani relations,” one local analyst believes.

“Such comments by a high-ranking US diplomat are, of course, offending, and will not go unnoticed by Baku," commented Elhan Shahinoglu, head of the Atlas think-tank. “Baku could … demand apologies in the future.”

Cables leaked earlier by WikiLeaks have touched on another sensitive spot for US-Azerbaijani relations – Iranian business activities and suspected money laundering in Azerbaijan.

One of the published dispatches, allegedly sent in March 2009 by former US Ambassador Anne Derse, lists 12 Iranians who allegedly have wide business interests in Azerbaijan as well as links to Iran’s political elite. The dispatch names them as suspected of laundering large amounts of money in Azerbaijan and violating international sanctions against Iran.

The dispatch mentions one Iranian bank, Bank Melli, and some large Azerbaijani banks -- Bank of Baku, Xalq Bank and Royal Bank – as involved in the illicit activities. Azerbaijani Transportation Minister Ziya Mammadov, Education Minister Misir Mardanov and the chief of the president’s security service, Vagif Akhundov, are also listed as possibly cooperating with the Iranians in question.

So far, only the Bank of Baku has denied the allegations. “The Bank of Baku has nothing to do with illegal money transfers,” it declared in a November 30 statement. “All bank clients’ operations are executed in strict correspondence with Azerbaijani legislation.”

The Bank goes on to state that one of the named Iranians, Adil Sharabiani, is not a client; a second, Jamsheed "Jushkar" Mahmudoglu, is not a shareholder.

The Bank of Baku confirms, though, that the ethnic Iranian Oromi family named in the dispatch is a bank founder, and a shareholder via the Turkish holding Nab Dis Ticaret.

A senior manager at one of the largest Azerbaijani commercial banks who did not want to be named told EurasiaNet.org that the Central Bank of Azerbaijan (CBA) actually tightly monitors any possible financial operations involving Iranian money laundering. “As early as this summer, the CBA unofficially banned commercial banks from opening accounts and providing services for Iranian nationals,” the source said.

The Central Bank of Azerbaijan declined to comment.

Meanwhile, pro-opposition Azerbaijani media outlets continue to focus attention on one of the most scandalous WikiLeaks dispatches – a February 2010 cable that repeats President Aliyev’s alleged opinions about Ankara’s “unconstructive” position on gas cooperation with Azerbaijan, the “failures” of Turkish foreign policy in the Middle East, Iran’s “provocations” against Azerbaijan, and the “feelings of strong confrontation” between Russian President Dmitry Medvedev and Prime Minister Vladimir Putin.

The cable on December 2 disappeared from the WikiLeaks’ Cable Viewer site. No explanation was provided for the removal.

In its November 30 statement, the presidential press office commented that the “jargon, sharp and emotional comments published by [WikiLeaks] are absent from the President’s vocabulary.”

Commenting on the alleged cable, experts differed in their assessment of what influence the information could have on Azerbaijani foreign policy.

Eldar Namazov, who worked in the 1990s as a senior foreign policy aide to the late president Heydar Aliyev, said he did not find anything new or surprising in the information. “I do not know what else WikiLeaks promised to disclose, but for now I do not see any sensation,” Namazov said. “These materials will have zero impact on Azerbaijan’s relations with other countries.”

The information could have its most serious impact on Washington’s relations with Azerbaijan and other countries in the region, believes Atlas’ Shahinoglu. “From now on, leaders of all countries will be very careful in their wording, even at closed meetings with US officials, which, of course, will make it difficult getting objectve information,” said Shahinoglu.

BP AZERBAIJAN PRESIDENT SAYS AZERBAIJAN MOVING!

Wednesday, 15 November 2006, 11:38
C O N F I D E N T I A L SECTION 01 OF 03 BAKU 001661
SIPDIS
SIPDIS
EO 12958 DECL: 11/15/2016
TAGS AJ, PGOV, PREL, EPET, ENRG, RU
SUBJECT: BP AZERBAIJAN PRESIDENT SAYS AZERBAIJAN MOVING
SLOWLY TO ADDRESS GAS PROBLEM
REF: ANKARA 006396
Classified By: Ambassador Anne. E. Derse, Reasons 1.4 (B,D)
¶1. (C) SUMMARY: At a November 10 Azerbaijan International Oil Company briefing, outgoing BP Azerbaijan President David Woodward told the Ambassador that according to SOCAR President Rovnaq Abdullayev, Turkey had not agreed to forego its contracted for 2007 Shah Deniz gas deliveries as a way of helping Azerbaijan and Georgia with their winter gas problems, although they were willing to defer delivery of some amounts if the contracted for price of USD 120 per thousand cubic meters remained the same. Woodward said that Turkey was declaring itself ready to receive Shah Deniz gas, although he himself had doubts. He said that a joint BP-SOCAR working group would start work soon to discuss ways of redressing possible GOAJ domestic gas shortages in winter 2007. END SUMMARY.
¶2. (C) On November 10 the Ambassador attended an Azerbaijan International Oil Company briefing headed by outgoing BP Azerbaijan President David Woodward. Other attendees were incoming BP Azerbaijan President Bill Schrader, BP Group Azerbaijan Director for Communications and External Affairs Clare Bebbington, UK Ambassador Laurie Bristow, UK EconOff, and Econoff as notetaker.
READ-OUT OF TU-GOAJ MEETING
--------------------------------------------- --
¶3. (C) Woodward gave a read-out of his November 2 meeting with SOCAR President Rovnaq Abdullayev. This meeting, prompted by the visit to Azerbaijan of BP Executive Vice-President and Deputy Chief Executive of Exploration and Production Andy Inglis, occurred right after Abdullayev had returned from Turkey with Deputy Prime Minister Abid Sharifov, where they had notified Turkey of intended delays in GOAJ 2007 Shah Deniz gas deliveries. Abdullayev, fresh off the plane, provided Woodward and Inglis a read-out of his Turkey meeting with Energy Minister Gular and Botas. Rovnaq told them that Botas would not sign the document he had brought, in which Turkey was asked to agree to GOAJ providing no Shah Deniz gas in 2007 and in which the GOAJ sought to re-open Shah Deniz price negotiations. Turkey insisted on receiving its contracted for 2007 three billion cubic meters (bcm) of Shah Deniz gas at the agreed upon price of USD 120 per thousand cubic meter (tcm), but said it did not have to receive it all in 2007. It proposed that it could take half (1.5 bcm) in winter 2007, with the rest to be received in 2008 or 2009, at the contracted price of USD 120/tcm. Abdullayev told Inglis that he had gotten Turkey to agree that it would be a transit country for Shah Deniz gas (vice a buyer-seller).
¶4. (C) During this November 2 meeting with Abdullayev and Sharifov, Energy Minister Gular also said that Turkey was ready to receive Shah Deniz gas. In this regard, Woodward said that he thinks that Botas will ask for commissioning gas during the week of November 13-17. As to how ready Turkey actually is to receive Shah Deniz gas, Woodward said that the BP opinion is that Botas still has a lot of work to do to complete the pipeline to include work on the valve stations, and that if the work were done in accordance with international standards then the pipeline might not be ready until spring 2007. However, he added that “it was not inconceivable” that Botas could “rush finish” the job so that it would be ready to receive gas shortly, although the pipeline would not meet international standards.
ACG PROBLEM RESOLUTION
-----------------------------------------
¶5. (C) Woodward said that during the recent visit of BP Executive Inglis, BP had given both President Aliyev and SOCAR President Abdullayev a copy of a BP ‘white paper’ on the way forward for Azerbaijan in the energy sector, (a copy of which he gave to the Ambassador), with the focus on four main themes:
- ACG Maximum Development: Resolving current issues associated with ACG to maximize recovery - Short/medium/long term gas issues: Short-term - how to address this winter’s gas needs; Medium/Long-term: how best
BAKU 00001661 002 OF 003
to identify and exploit GOAJ gas reserves - SOCAR: how to help make SOCAR an energy company that meets international standards - BP Social Programs: putting a ‘harder edge’ on them, to help build capacity in Azerbaijan
¶6. (C) Woodward said that there were a series of outstanding ACG-related issues the resolution of which involved billions of dollars and which the AIOC partners were trying to resolve with SOCAR in a package, vice individually. In the November 2 meeting between SOCAR President Rovnaq Abdullayev and BP executive Inglis, Abdullayev said that he would head the SOCAR ACG steering group dealing with these problems, and that SOCAR VP Elshad Nassirov would be the SOCAR working level representative. Abdullayev also said he would head the SOCAR team on the BP-SOCAR gas working group, with Nassirov again the working-level representative. Woodward said that Abdullayev had an unrealistic expectation of how quickly these outstanding ACG issues could be resolved: whereas BP thinks that a framework within which to discuss the issues could be agreed upon by January, with actual negotiations over these issues lasting up to six months, Woodward said that Abdullayev told Inglis that the issues could be solved ‘within a few days.’
¶7. (C) Woodward said that Abdullayev did not show much willingness to engage with BP re Azerbaijan’s short-term (Winter 07) gas problems, contending that AIOC giving SOCAR more associated ACG gas could solve the problem. (Note: AIOC is scheduled to give 1.4 bcm of associated ACG gas to SOCAR in 2007; SOCAR is arguing that AIOC does not need to re-inject any ACG associated gas back into the well, and wants 3 bcm). Woodward said that all sides seemed to be waiting for the results of the President Aliyev-President Putin meeting in Moscow, although he himself doubted whether the two would reach any definitive agreement, as everyone is waiting to see the results of the various CIS bilateral Gazprom negotiations, to see if the USD 230/tcm level will hold.
BP GEORGIA GAS READOUT
----------------------------------------
¶8. (C) Woodward said he and his replacement Bill Schrader had just returned from Georgia, where they had met separately with the Georgian Energy Minister, Environment Minister and Prime Minister, among others. At these meetings the Georgian proposal of a November three-way gas-focused Turkish-Azerbaijani-Georgian ministerial-level meeting in Tblisi or Ankara was discussed, although nothing definite had been agreed to by all parties. In their meetings, the GOG interlocutors had referred to Turkey’s Summer 2007 ‘agreement in principle’ to supply Georgia from its own Shah Deniz gas, although Woodward said in his opinion all Turkey had agreed to at that time was a ‘bring us a proposal and we’ll have a look at it’ type agreement. Woodward said that the GOG Energy Minister had told him that GA would not buy gas from Gazprom at USD 230/tcm, and that Turkey would supply GOG with 1.5 bcm in 2007. Woodward said the GOG PM was more realistic, saying that perhaps Georgia could get 0.8 to 1.2 bcm from Turkey in 2007. Woodward said the GOG PM seemed more relaxed about the upcoming winter gas situation than did the Energy Minister, and more concerned about Shah Deniz Stage Two-related issues, stating that, inter alia, Georgia and Azerbaijan should look at gas storage issues together, vice separately. Woodward said he got the impression that GOG was more concerned about the economics of gas purchases from Gazprom than the supply itself, and he noted that despite the intense rhetoric flowing between Russia and Georgia, the energy continues to flow.
SD PRODUCTION
------------------------
¶9. (C) Woodward agreed that Shah Deniz was experiencing production delays, but said that other issues would play a more determinative role in deciding where Shah Deniz gas went, such as the GOG technical capacity to uptake Shah Deniz gas at its border with Azerbaijan. He said that the Gas Pressure Reduction and Metering Station at Pump Station One in Georgia has a maximum daily design throughput of 4.0 million cubic meters, equivalent to 1.46 bcm/a at one hundred percent load (note: this compares to currently contracted
BAKU 00001661 003 OF 003
quantities which build up to around 08. bcm/a by 2011). As such, he said that part of the work of the SOCAR-BP gas working group that would be meeting imminently would be to model how much gas Georgia could uptake from Azerbaijan from a technical viewpoint. He noted that in addition to the SCP (i.e. Shah Deniz) pipeline, there was also the possibility of transferring gas from Azerbaijan to Georgia through the Azerbaijani gas system. As for Shah Deniz gas itself, Woodward said that as soon as the first two of the four wells start flowing (mid-November and late December respectively), will it be clear how quickly and how much production will be available for winter 2007.
¶10. (C) COMMENT: Before determining what steps to take to redress any possible winter 07 gas shortages in Azerbaijan and Georgia, Azerbaijan first needs to assess its current gas balance and possible alternative supply options. In this regard it is encouraging to hear that the joint BP-SOCAR gas working group is scheduled to meet the week of November 12. Woodward however was disparaging of the selection of SOCAR President Rovnaq Abdullayev and Deputy Prime Minister Sharifov as the GOAJ officials sent to Ankara to deal with the Turkish government (indeed, a Statoil representative told the Ambassador that Abdullayev had taken the wrong version of the Shah Deniz contract to the discussions), and despaired of any solution to the short-term regional problem occurring if management of the issue stayed at the SOCAR level. As such, he requested USG help in convincing Turkey to meet with Azerbaijan and Georgia. Now that Turkey is doing so (see reftel), Embassy will seek to ensure that the GOAJ participates at the appropriate level.

S E C R E T SECTION 01 OF 04 BAKU 000127

S E C R E T SECTION 01 OF 04 BAKU 000127

SIPDIS

COMMERCE FOR D.STARKS
EEB/CBA FOR T.GILMAN
DEPT PLEASE PASS TO USTR FOR C. MORROW AND P. BURKHEAD

EO 12958 DECL: 02/24/2020
TAGS ECON, EINV, EIND, ETRD, KCOR, PINR, PGOV, RS, KS, IR,
TU, AJ

SUBJECT: AZERBAIJAN: WHO OWNS WHAT VOL. 2 - THE MINISTER OF
EMERGENCY SITUATIONS, BELUGA CAVIAR, AND FRUIT JUICE (C-RE9-02494; C-RE9-02493; C-RE9-02492)
REF: BAKU 54

Classified By: XXXXXXXXXXXX a.i., for reasons 1.4(b) and ( d).

¶1. (S) SUMMARY: This cable is the second in a series that profiles the most powerful families in Azerbaijan, both in terms of economic and political power. This issue features Minister of Emergency Situations Kamaladdin Heydarov and his family. Heydarov was previously Chairman of the State Customs Committee, and his hand-picked successor now operates that agency, one of the most corrupt operations in Azerbaijan. The Heydarov family, which controls a business empire in Azerbaijan ranging from fruit juice production to real estate development, is the second most powerful commercial family in Azerbaijan, after the Pashayev family (into which President Aliyev married). End Summary.

The Man Behind the Power
------------------------

¶2. (S) Kamaladdin Heydarov is the most powerful member of this family, and some observers have said he might be even more powerful than the President himself. (COMMENT: Post does not believe this is true, although Heydarov controls more visible assets and wealth within the country than the President. End Comment.) His father, Fattah Heydarov, is a Member of Parliament from the mountainous Qabala district, which serves as a home base for the family outside Baku. Fattah was Secretary of the Ordubad (and later Julfa) District Party Committee during Soviet times, and served as Minister of the Welfare Service of Nakhchivan from 1976 to 1978 and later as Nakhchivan’s Minister of Culture from 1983 to 1995.

¶3. (S) Kamaladdin Heydarov was Chairman of the State Customs Committee for nine years, and since 2006 has been head of the para-military Ministry of Emergency Situations (MES), which acts as a super-Federal Emergency Management Agency, Fire Marshall, health and safety inspector, and overall regulator of many aspects of the economy. Born in 1961, he holds a degree in Geology and International Law from the Azerbaijan State University. He held executive positions in a number of private and public enterprises prior to his appointment at the ripe old age of 35 as Chairman of the State Customs Committee (SCC), an agency that is notoriously corrupt, even by Azerbaijani standards. Heydarov’s rise to power was partly a result of the strong relationship between his father Fattah and former President Heydar Aliyev (also from Nakhchivan), but also partly a result of Heydarov’s strong management skills. As he gained wealth for the ruling party, Heydar Aliyev’s respect for him grew, until finally he was entrusted with the valuable role of Chairman of the SCC.

¶4. (S) The State Customs position allowed him to gain his massive wealth, as significant illicit payments were paid “up the food chain” in an elaborate and well-orchestrated system of payoff and patronage. Heydarov likely still enjoys a sizeable income from the SCC, as it is controlled by his loyal successor. When President Ilham Aliyev appointed Heydarov as Minister of Emergency Situations in 2006, he was replaced at the SCC by his Deputy Aydin Aliyev. Aydin Aliyev is not related to President Aliyev, and Heydarov is Aydin Aliyev’s sole benefactor, a symbiotic relationship in which Aliyev presumably gives undying loyalty (and a hefty cut) to the powerful Heydarov in order to retain his position. When Charge first met Heydarov in 2007, the Minister had been in office for less than a year but had a chest full of military ribbons that would rival the U.S. Chairman of the Joint Chiefs. Presumably he transferred them directly from his old State Customs uniform.

The Ministry of Everything Significant (MES)
--------------------------------------------
BAKU 00000127 002 OF 004

¶5. (SBU) The Ministry of Emergency Situations (MES) has consistently proven itself to be one of the most powerful ministries in Azerbaijan. It is suspected to have the largest revenue of any Ministry. It even has its own para-military unit, consistent with other such ministries in the CIS. Heydarov mentioned to a visiting Washington VIP in 2008 that his ministry had recently taken control of an anti-aircraft battery near Baku in which he had served as a young conscript during Soviet times. The Ministry now controls the fire departments and other emergency services, fire code inspections, state grain reserves, and construction licensing. This last area of responsibility (perhaps the most important for foreign entities operating in Azerbaijan) also covers building inspectors who can interfere with, delay, or stop any construction project they declare to be “unsafe.” In fact, MES staff have previously warned American and other foreign businessmen that their purview covers anything that is associated with temperature, pressure, or isotopes -- categories broadly interpreted to include just about everything under the sun.

¶6. (SBU) It is often said mockingly that in Azerbaijan’s judicial system, one can only win a case if one is friends with the judge - or if introduced by Benjamin Franklin (read: significant cash). Of course being known to the judge as politically powerful is another path to courtroom victory. The path to certifying a building’s safety is likely similar, and the true structural integrity of Baku’s recent construction boom is suspect. In 2007, a multi-story high-rise under construction crashed to the ground, killing several workers. In January 2010, three workers were killed when they fell from a building under construction on high-rent Neftchiler Prospect (reftel). Suspect construction is widespread in Baku, as new, speculative real estate ventures in central Baku (including high-rise buildings) are largely vacant, while practical buyers bid up the prices of flats in “Stalin-ka” buildings that pre-date independence. These older buildings, which tend to be low-rise, are thought to have had higher construction standards and generally be safer and more dependable.

¶7. (S) These types of market developments do not bode well for the reputation of MES, which is widely viewed as a cash cow for Baku’s elite, and the Heydarov family in particular. If an event such as an earthquake led to widespread destruction of property, it is assumed that outrage would be private, rather than public, and would not boil over into attacks on contractors or corrupt bureaucrats, as was the case after the 1999 earthquake in Istanbul. Some less powerful contractors would become easy targets, but the true architects of disaster such as Heydarov’s MES would find a way to use its resources and the tools of the state to escape any reprisal.

His Boys and Their Toys
-----------------------

¶8. (S) Kamaladdin’s two sons, Nijat Heydarov and Tale Heydarov, have recently expressed a desire to purchase two Gulfstream jets, valued at $20 million each. The family also owns an Airbus A319 corporate jet that is presently undergoing cabin completion in Basel, Switzerland. According to initial reports, ownership of the Gulfstreams would be shared between “Shams al Sahra FZCO” (registered in Dubai to Tale and Nijat) and Mr. Manouchehr Ahadpur Khangah, with Shams al Sahra and Kangah each holding 50 percent of each jet. Khangah was not previously known to the Embassy, but according to information from Gulfstream appears to be a citizen of both Iran and Azerbaijan (unclear if he also holds other passports). Purportedly as part of Patriot Act compliance, Gulfstream asked the Heydarovs for information that would confirm the lawful sources of their wealth. The
BAKU 00000127 003 OF 004
Heydarovs provided Gulfstream an overview of their family holdings, and it appears they own more businesses than any other Azerbaijani family, including companies in food canning, construction materials, concrete, asphalt, chemicals, bricks, textiles, CD and DVD production (since licensed CDs or DVDs are generally unavailable on the local market, these are certainly all pirated), milk processing, tourism, gypsum materials, leather, agriculture, pianos, alcohol and spirits, juices, banking, insurance, and construction.

¶9. (C) One Embassy contact, XXXXXXXXXXXX referred to Khangah as the Chief Executive Officer or “front man” of a substantial portion of the Heydarov family conglomerate. This contact noted that while Khangah is listed as the official owner of various businesses, they are very much Heydarov-owned operations in which Khangah functions more as a manager. This source added that Khangah’s role was mirrored by an unnamed Turkish citizen who controls another segment of the family businesses.

¶10. (C) Many of the family,s operations are part of the “Gilan,” “Qabala,” “Jala,” or “United Enterprises International (UEI)” family of companies. Gilan Holdings is omnipresent in Baku, as the company is one of several major real estate developers and has been in the forefront of Baku’s highly speculative real estate market. Observers compare Gilan to Dubai World or Nakheel, although admittedly on a smaller scale. The Heydarovs have largely cornered the fruit juice market in Azerbaijan, maintaining extremely high prices for locally produced juices and watered-down juice drinks, while making life difficult -- with the help of State Customs -- for cheaper competitors from Turkey, Ukraine and Russia. When USAID tried to support the production and distribution of pomegranate products in Azerbaijan, they quickly learned that no one sells pomegranate juice, concentrate, or derivatives from Azerbaijan without Heydarov’s permission. Azerbaijan’s economy is largely dominated by monopolistic interests, and observers suggest that the Heydarovs are at the top of this mountain of non-competition. It is rumored that the Heydarovs also have interests in the local Pepsi bottler, the local license for Red Bull, British American Tobacco, Japan Tobacco, and Imperial Tobacco. Heydarov has readily admitted to visiting U.S. delegations that he owns and operates the Caspian Fish Company which controls the lucrative (and previously Russian Mafia-controlled) Beluga Caviar production in Azerbaijan.

¶11. (S) The Heydarovs are also active in cultural endeavors. Kamaladdin Heydarov is a composer and has written a song about former President Heydar Aliyev that was sung by Azeri singer Aghadadash Aghayev. His wife is ethnic Korean, and he himself is quite the Koreaphile; he is President of the Azerbaijan Taekwondo Federation and owner of the recently opened high-end Korean restaurant “Shilla.” Korean diplomats have confirmed that Heydarov was the protector for several major business deals, but have complained that many of these deals have gone awry after the Korean firms refused to pay adequate patronage to Heydarov.

¶12. (C) Heydarov’s son Tale is the President of The European Azerbaijan Society (TEAS), and has made rounds to U.S. embassies in European capitals from his London base. The “society” purports to be an independent advocacy group, but its talking points very much reflect the goals and objectives of the GOAJ. In recent meetings, Tale and his cohorts have raised “Armenian aggression” in Nagorno-Karabakh and “double standards” of U.S. human rights and democracy reporting in the region, and complained about efforts of the U.S. Congress to provide humanitarian assistance within the Nagorno-Karabakh enclave. Tale and/or Nijat also own the Qabala Football Club -- perhaps as a small-scale effort to replicate the Chelsea antics of Russia’s Roman Abramovich. The Qabala squad is a virtual United Nations team, with
BAKU 00000127 004 OF 004
players from across Europe, Latin America and Africa -- the best team money can buy, at least for central Azerbaijan. Both sons were educated in London and presently live there. Tale holds a B.A. in International Relations and History from the London School of Economics and an M.A. in Security and Global Governance from Birkbeck College, while Nijat holds a B.A. in Politics and East European Studies from University College London and an M.A. in Management, Organizations, and Governance from the London School of Economics. Some newspapers have reported that Tale might return to Baku to become a Member of Parliament later this year.

It’s Good to Be King
--------------------

¶13. (C) The family’s influence is strongest in the regions of Qabala, Masalli, and Lenkeran. Postsuspects that Heydarov continues to control the tate Customs Committee and wield influence over the Ministry of Taxes, the Ministry of Ecology and Natural Resources, and Ministry of Economic Development, which is now led by a former Ministry of Taxes official. Additionally, of course, Heydarov profits significantly from widespread activities of the Ministry of Emergency Situations. That ministry, according to observers, may be the most sought after employer in official Baku, as Heydarov has made a reputation for paying salaries on time and in full. Employees benefit from perks of MES employment, such as the ability to enroll children in one of Baku’s best-looking and best-financed public schools. Measures like these, contacts report, create a loyal following for the minister among his minions.

Turf Wars: Don’t Cross Kamaladdin
---------------------------------

¶14. (S) Embassy contacts note that Kamaladdin Heydarov is currently in a “fight over grain” with Minister of Agriculture Ismat Abbasov, and wants Abbasov replaced by Member of Parliament Eldar Ibrahimov. Historically, those who have fought with Heydarov have always fared poorly: Farhad Aliyev and Heydar Babayev were (in succession) driven out as Minister of Economic Development in part after falling on Heydarov’s bad side. Both were billed as reformers, and the economic reforms they were seen to propose stood to hurt Heydarov’s interests at the State Customs Committee and the Ministry of Emergency Situations. In addition, some opposition newspapers had begun to call them potential candidates for the position of Prime Minister. Feeling threatened by their reform activity and growing power, Heydarov allegedly put his foot down. Both were removed from government and their business interests were seriously damaged. Rumors circulated in 2009 that Heydarov may have even been behind the assassination of Air Force Chief and Deputy Defense Minister General Rail Rzayev. The rumors point to the widely-reported forced landing of Heydarov’s helicopter after it took off without obtaining flight clearance.

¶15. (U) The next issue of “Who Owns What” will profile the family of Ziya Mammadov, the Minister of Transportation. With so much of the nation’s oil wealth being poured into road construction, the Mammadovs also control a significant source of rent-seeking. His holdings extend to the buses that run throughout Baku. A recent television report asked if the Mammadovs controlled mysterious construction company ZQAN Holding; the reporter pointed out the letters of ZQAN matched the initials of father Ziya, mother Qanira, son Anar, and daughter Nigar. A ZQAN representative brushed this aside as innuendo. 

The Minister of Everything Significant and His Son

A U.S. Embassy cable from Baku, leaked by WikiLeaks, gives a report on Azerbaijan’s Heydarov family, “the second most powerful commercial family in Azerbaijan,” noting the lobby efforts of Tale Heydarov, head of the European Azerbaijan Society (TEAS), especially in regards to Nagorno-Karabakh.

According to the cable, the Heydarov family’s most powerful member is Kamaladdin Heydarov, who has been the head of the Ministry of Emergency Situations (MES)—otherwise known as “The Ministry of Everything Significant”—since 2006. “Observers have said he might be even more powerful than the President himself.”

“The Ministry now controls the fire departments and other emergency services, fire code inspections, state grain reserves, and construction licensing. This last area of responsibility (perhaps the most important for foreign entities operating in Azerbaijan) also covers building inspectors who can interfere with, delay, or stop any construction project they declare to be “unsafe.” In fact, MES staff have previously warned American and other foreign businessmen that their purview covers anything that is associated with temperature, pressure, or isotopes — categories broadly interpreted to include just about everything under the sun.”

Heydarov has two sons, Nijat and Tale. The cable states: “Heydarov’s son Tale is the President of the European Azerbaijan Society (TEAS), and has made rounds to U.S. embassies in European capitals from his London base. The “society” purports to be an independent advocacy group, but its talking points very much reflect the goals and objectives of the GOAJ [government of Azerbaijan]. In recent meetings, Tale and his cohorts have raised ‘Armenian aggression’ in Nagorno-Karabakh and ‘double standards’ of U.S. human rights and democracy reporting in the region, and complained about efforts of the U.S. Congress to provide humanitarian assistance within the Nagorno-Karabakh enclave.”