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SIPDIS 
 
DEPT FOR EUR/AGS, INR/EU, AND EUR/PPD FOR YVETTE SAINT-ANDRE 
 
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E.O. 12958: N/A 
TAGS: KPAO AU OPRC
 
SUBJECT: AUSTRIAN MEDIA HIGHLIGHTS: November 14, 2006 
 
 
Khol against Minority Government 
 
¶1. Speaking on ORF TV yesterday, former Parliamentary President 
Andreas Khol said a minority government for Austria would be "a 
disaster." He expects a "signal" for the OeVP from SPOe leader 
Alfred Gusenbauer regarding the suspended coalition talks. 
Speaking on ORF TV's late night news program Zeit im Bild II on 
November 13, former OeVP Parliamentary President Andreas Khol 
explained that, rather than forming a minority government, he 
recommends looking at three-party coalition options should a grand 
coalition of the SPOe and the OeVP not be possible. Whether the OeVP 
leadership will decide to definitely cancel coalition talks with the 
SPOe on Wednesday depends on the outcome of the ongoing "informal 
talks" between representatives of the two parties, Kohl added. 
Mass-circulation provincial daily Kleine Zeitung meanwhile 
speculates that SPOe leader Alfred Gusenbauer could propose 
formation of a minority government when he meets with President 
Heinz Fischer on Thursday. In the face of these developments, 
high-ranking OeVP politicians have accused Fischer of "playing 
along" with the Social Democrats' government plans, the daily 
writes. 
 
 
Bawag Goes to Foreign Bidder 
 
¶2. Ahead of the publication of the short list of bidders in the sale 
of union-owned bank Bawag it seems clear the bank will go to a 
foreign company, as there are no Austrian bidders in the running any 
longer. German and American companies have been named as potential 
buyers. 
Like all Austrian media, centrist daily Die Presse speculates on 
"who will win the poker game" over the sale of scandal-ridden 
union-owned bank Bawag. Investment bank Morgan Stanley will analyze 
offers for the purchase of Austria's fifth largest bank from US 
investor group Cerberus, US investors Apollo, J. C. Flowers and Lone 
Star, German insurance giant Allianz, the Bavarian Bayerische 
Landesbank, and - possibly - French banking corporation Crdit 
Agricole. 
 
 
EU and Turkey 
 
¶3. Austrian Foreign Minister Ursula Plassnik has suggested a "pause" 
in European Union membership talks with Turkey, unless Ankara agrees 
to recognize EU member state Cyprus. 
The European Union has given Turkey three weeks to accept a 
diplomatic deal on trade with Cyprus or suffer consequences in its 
attempts to join the EU. The Finnish EU Presidency emphasized that 
Turkey has to meet its EU treaty obligations and open its ports to 
Cyprus, ORF radio news Morgenjournal says. 
EU foreign ministers are meanwhile struggling to come up with a 
joint position in the European Union's dispute with Turkey, 
mass-circulation daily Kurier writes, adding that a strategy needs 
to be fixed by the December EU summit. Austrian Foreign Minister 
Plassnik has suggested a "time-out" in the talks between the EU and 
Ankara, as the two parties were "not making any progress" at this 
point. Until there is progress on the issue from Turkey, "the EU 
cannot move. Therefore, taking a break might be wise," Plassnik 
explained. She added, however, that she remains opposed to sanctions 
against Ankara, the Kurier reports. 
 
Hamas: Change of Course? 
 
¶4. Radical Palestinian organization Hamas has said for the first 
time it might support a peace conference with Israeli participation. 
Arab countries and the UNSC permanent members should also be 
represented at the conference, which is to aim for a comprehensive 
and fair Mideast solution, the Palestinian foreign minister 
suggested. 
Hamas' proposal to hold a comprehensive Mideast conference with 
Israeli participation and its apparent change of course on the issue 
indicates that international pressure on the Palestinians has been 
successful, writes semi-official daily Wiener Zeitung. This is the 
first time that the radical Palestinian organization has said it 
wants to negotiate with Israel, the daily, adds. Israeli Premier 
Ehud Olmert has also said he is willing to discuss the Mideast peace 
process with Hamas being part of the Palestinian government, 
provided that certain conditions are met. The Palestinians have 
apparently reached a cross-roads, the daily says, pointing to the 
appointment of Mohammed Al-Shbeir as the new head of government and 
attempts to reduce their international isolation. 
Tricky Summit for Bush 
 
¶5. The politically weakened US President is facing the "most 
travel-intense week" of his presidency, an Austrian daily says, 
pointing to the upcoming NATO summit in Riga, and the APEC summit in 
Hanoi. All hot political topics are on the agenda, including Iraq, 
Iran and North Korea's nuclear programs, Afghanistan, world trade, 
and terrorism. 
An analysis in semi-official daily Wiener Zeitung says with the Riga 
and Hanoi summits, the US President has two difficult meetings on 
his agenda.  He will be meeting with world leaders including 
Russia's Vladimir Putin, China's Hu Jintao, France's Jacques Chirac 
and Germany's Angela Merkel, at the NATO and APEC conferences, but 
the summits could likely turn out to be difficult performances for 
Bush on the international political stage. Aside from key 
international topics from Iran to terrorism looming large on the 
agenda, the US President will be hard pressed to prove that he has 
not been reduced to a "lame duck" with the Democratic victory in 
Congress, the Wiener Zeitung writes. 
 
Iraq Course: About-Face or More of the Same? 
 
¶6. While some Austrian media suggest the US might induce a new 
course on Iraq and search for a new strategy for the entire Middle 
East, ORF radio believes a more radical American change of course on 
Iraq cannot be expected, given President Bush's statements following 
the meeting of the Iraq study group. 
ORF TV's late night news Zeit im Bild II on November 13 suggests 
that after the US Congressional elections, Americans expect things 
will change in Iraq. In the face of Republican losses, President 
Bush, too, appears to be ready to rethink his Iraq strategy, but it 
remains unclear how, ORF radio says. After a meeting with its 
representatives on monday, Bush seems to be banking on the Iraq 
Study Group headed by former Secretary of State James Baker, 
according to ORF TV. 
In contrast, Washington correspondent Christian Lininger says on ORF 
radio's early morning news Morgenjournal that "we do not know what 
President Bush and the members of the Iraq Study Group discussed in 
detail. What has become clear, though, is that the US President 
apparently does not think much of an all-too radical change of 
course on Iraq. (...) He was not enthusiastic, either, regarding 
proposals to include Iran and Syria in the Iraqi stabilization 
process. Earlier, US Ambassador to the UN John Bolton emphasized 
that the US 'cannot pull out of Iraq prematurely and leave a failed 
state behind.' The Democrats have meanwhile reiterated their call 
for the beginning of a US withdrawal from Iraq in six months at the 
latest." 
McCaw