VZCZCXRO7004
PP RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHMO #5117/01 2961353
ZNY CCCCC ZZH
P 231353Z OCT 07
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC PRIORITY 4798
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY

C O N F I D E N T I A L SECTION 01 OF 03 MOSCOW 005117 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 10/22/2017 
TAGS: PREL EU WTRO ETRD ENRG KO RS
SUBJECT: LOOKING AHEAD TO THE EU-RUSSIA SUMMIT 
 
REF: MOSCOW 4633 
 
Classified By: Minister-Counselor for Political Affairs Alice G. Wells 
for reasons 1.4 (b/d). 
 
¶1. (C) Summary: Russia has set a low bar for the EU-Russia 
summit, and will go to Lisbon prepared to push back on 
criticism of its human rights and democracy record, as well 
as to press for clarity on the implications of EU reform. 
With the continued stand-off over Polish meat, the Russians 
see "regression," not progress, in the PCA discussions, which 
is unlikely to be affected by the outcome of the Polish 
elections.  WTO is a priority, with the MFA emphasizing the 
need for "political level" involvement in resolving 
outstanding disputes.  Energy security is likely to remain 
contentious, with strong GOR criticism of "unbundling 
requirements" only marginally offset by a last-minute 
agreement over an "early warning" system in the event of 
energy cut-offs.  While Russia will push for more effective 
implementation of the new visa regime, it confronts EU 
unhappiness over GOR failure to implement the Siberian 
overflight agreement.  Russia remains content to let the 
momentum of its growing economic relations drive its key 
European relations forward.  End Summary. 
 
Russian Priorities for Summit 
----------------------------- 
 
¶2.  (C) In an October 19 meeting, Director of the Department 
for European Cooperation Sergey Ryabkov listed the GOR's 
priorities for the October 26-28 EU-Russia Summit, which will 
be the last of Putin's presidency.  They include the legal 
framework for EU-Russia ties, including the future of the 
PCA; WTO accession; energy; a dialogue on a future visa-free 
regime; and Kosovo.  Ryabkov noted that Iran would feature 
prominently in the working lunch, with the GOR waiting for 
High Representative Solana's report on his meeting with 
Iranian former lead nuclear negotiator Ali Larijani in Rome. 
(Ryabkov's comments predated Larijani's resignation.) 
 
¶3.  (C) Ryabkov told us the first agenda item was for the EU 
and Russia to touch base after the informal summit of EU 
leaders in Lisbon October 18-19, which reached an agreement 
on the new EU treaty to be signed on December 13.  According 
to Ryabkov, the GOR wants to discuss how future EU reform 
will be implemented, and how it will affect neighborhood and 
security policy.  Ryabkov, reiterating published remarks by 
DFM Grushko, complained that the EU and Russia lacked a 
structure in which to exchange views and take joint 
decisions, similar to the NATO-Russia Council.  Ryabkov said 
the GOR was prepared for EU comment on Russia's human rights 
and democracy track record, and would counter with its own 
concerns on internal practices in Latvia and Estonia. 
 
The PCA and Poland 
------------------ 
 
¶4.  (C) There has been no progress on opening new PCA 
negotiations, Ryabkov told us, but "regression" instead.  He 
noted that while the level of EU-brokered contacts between 
Russia and the Poles had been lower in the past four months 
than under the German presidency, the issue had been fully 
explored and each side's position made clear.  He doubted 
that upcoming Polish elections would bring change, because 
the "fundamental position of Polish politics was hostile" to 
Russia.  He said a breakthrough in negotiations could only 
come if the new Polish government allowed Russian officials 
to access its meat-processing facilities, but noted Poland 
will only discuss the matter through the EU at this point, 
and the EU will only tell Russia that EU inspectors see 
nothing wrong.  Ryabkov said that the GOR has provided the EU 
with files showing previous quality and documentation 
failures.  He reiterated that technical, not political, 
solutions must be found, and that Russia was "quite relaxed" 
about the process. 
 
¶5.  (C) In the wake of Polish President Kaczynski's September 
unofficial visit to Russia (reftel), Ryabkov admitted to a 
slight softening of tensions between Russia and Poland.  He 
told us that Presidential Foreign Policy Advisor for Europe 
Sergey Yastrzhembskiy had visited Poland recently, and 
Chairman of the Central Elections Committee Vladimir Churov 
reportedly traveled there on October 20.  On the agricultural 
side, he said there had been a meeting between Russian and 
Polish heads of Veterinary and Phyto Services in Moscow on 
October 15, which had been useful to discuss the meat issues, 
as well as other agricultural cooperation.  EC Commissioner 
for Health and Consumer Protection Markos Kyprianou and 
Russian Minister of Agriculture Aleksey Gordeyev will meet 
again after the EU-Russia summit. 
 
WTO Accession: Now or Never? 
---------------------------- 
 
MOSCOW 00005117  002 OF 003 
 
 
 
¶6.  (C) Ryabkov told us that Russia remains politically 
committed to joining the WTO, and it would "definitely" be 
discussed at the summit.  He noted that there were still 
ongoing negotiations about IPR and railroad tariffs, and 
several Nordic countries felt that an export tariff on timber 
(originally aimed by the GOR at Asian countries) was not 
compatible with WTO policies.  The EU wanted to bring these 
issues to the political level, Ryabkov said, connecting them 
with progress on a free trade regime between the EU and 
Russia.  The GOR preferred, however, to bring the tariffs in 
line with WTO standards more gradually, and gave as an 
example of this the signing of an agreement on releasing 
tariffs on steel and steel products.  Ryabkov told us that 
Russian Minister of Economic Development and Trade Nabiullina 
and EU Trade Commissioner Mendelson would be meeting on the 
margins of the summit. 
 
¶7.  (C) European Commission diplomats were less optimistic 
that the summit would make progress on Russia's accession. 
They told us that the Poles are serious about following 
through on their threats to block Russia's accession unless 
the meat embargo is resolved.  They noted that the GOR had 
promised they will submit proposals to bring timber and 
railway tariffs in line with WTO standards before the summit, 
but said that resolving these issues was firmly a Russian 
responsibility.  Dr. Dimity Danilov, Head of the Department 
for European Security Studies at the Institute of Europe 
predicted that if progress was not made at the summit and 
Russia did not join the WTO within a year, its enthusiasm and 
efforts would wane. He warned that the EU was underestimating 
how important it was to use existing momentum to achieve real 
breakthroughs at the summit. 
 
Energy 
------ 
 
¶8.  (C) According to Ryabkov, new EU energy regulations 
requiring "unbundling" production from transportation are "of 
a discriminatory nature" towards Russia and have faced a 
harsh reaction in Moscow, with Putin himself threatening 
retaliation.  Ryabkov noted that the regulations seemed 
targeted towards recent Russian legislation on the protection 
of strategic sectors, which would specifically limit foreign 
investment in oil and gas.  While regulations were not yet 
complete, Ryabkov did not expect the final version to differ 
significantly.  The GOR was prepared to challenge the EU's 
critique of state corporations, he stressed, and had not 
received what it considered to be adequate replies to date. 
 
¶9.  (C) Ryabkov told us that the GOR signed an EU proposal on 
an early warning system on energy issues on October 17.  EC 
diplomats expressed pleasant surprise, noting that even a 
week prior the GOR had claimed there was no need for such an 
agreement, since it always gave the EU "plenty of warning" 
before reducing supplies to transit countries (Note: EU 
Commission diplomats ironically noted that in the case of 
Ukraine in early October, the "early warning" had been 24 
hours).  However, diplomats believe that Russia wanted to 
make progress on energy dialogues to reassure Europe of 
Russia's dependability.  Danilov agreed, noting that while 
the Europeans see this as a security matter, the GOR views it 
as a business matter. 
 
Kosovo: No Change in Position Expected 
-------------------------------------- 
 
¶10.  (C) Ryabkov did not expect a breakthrough on Kosovo, and 
stressed that the GOR had "no expectations of disunity" among 
member states on Kosovo's final status.  He stressed that EU 
recognition of a unilateral declaration of independence would 
be a "very grave" development, and said that Russia would 
"strongly urge" them to think more about it at the summit. 
The GOR saw the troika process as more useful than expected, 
with both the Serbs and Kosovars expressing a genuine 
interest in the questions on the table.  Ryabkov told us that 
this progress should be supported and that Russia will 
continue to urge countries to refrain from public statements 
on the endgame.  Ryabkov stressed that the GOR will support 
an extension of negotiations beyond December 10 and argued 
that "closing the door on the 10th" was an untenable 
solution. 
 
Visa Free Regime and Overflights 
-------------------------------- 
 
¶11.  (C) Ryabkov predicted that the EU will keep the emphasis 
of dialogue on the future of a visa free regime focused 
firmly on "the future."  He said that new visa procedures 
have been implemented on easing diplomatic, business, and 
student travel, but the major obstacle to implementation 
remains the noncompliance of EU member states on short 
turnaround times and the charging of higher visa fees then 
 
MOSCOW 00005117  003 OF 003 
 
 
agreed.  He also complained that some countries were 
requiring a long list of documents from truck drivers, plane 
crews, and others who need a multiple-entry visa.  He said 
that the issue is "technical, yet political at the same 
time." 
 
¶12.  (C) EC diplomats told us that Siberian overflight 
rights, an outstanding irritant between the EU and Russia, 
were agreed to last year, but Russia still has not signed the 
agreements.  Putin reaffirmed on October 15 that Russia would 
join, but nothing has been received yet.  EC diplomats 
asserted that the EU would link failure on this issue to an 
upcoming aviation summit in November, and would cancel it if 
the Russians did not show progress.  Still, they saw last 
minute Russian compliance as "not impossible." 
 
Comment 
------- 
¶13.  (C) Russia has set a low bar for the EU summit, and is 
content to let the momentum of growing economic ties drive 
its European partnerships.  Small deliverables, the vigor of 
the industrialists' roundtable, and even an imperfect 
implementation of new visa procedures highlight that 
political problems remain separate from bountiful economic 
relations. 
Burns