VZCZCXRO1716
OO RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHUP #0504/01 0921153
ZNY CCCCC ZZH
O 021153Z APR 07
FM AMEMBASSY BUDAPEST
TO RUEHC/SECSTATE WASHDC IMMEDIATE 1031
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY

C O N F I D E N T I A L SECTION 01 OF 02 BUDAPEST 000504 
 
SIPDIS 
 
SIPDIS 
 
DEPARTMENT EUR/NCE MICHELLE LABONTE 
 
E.O. 12958: DECL: 04/02/2012 
TAGS: PREL PGOV CVIS KDEM ENRG HU
SUBJECT: READOUT OF DAS PEKALA'S BUDAPEST CONSULTATIONS 
 
 
Classified By: POL/C ERIC V. GAUDIOSI; REASONS 1.4 (B) AND (D) 
 
¶1. (C) Summary: EUR Deputy Assistant Secretary Mark Pekala 
used his March 25-27 visit to Budapest to underscore to GOH 
decision-makers, advisors and opinion leaders our commitment 
to a continued strong relationship with Hungary based on 
shared principles and values.  He also provided an interview 
to the Hungarian weekly "Heti Valasz" and took the 
opportunity to meet with the Embassy community in a town hall 
meeting.  His visit reflected strong consensus across the 
political spectrum regarding the Visa Waiver Program, deep 
divisions on energy security, and support on the Balkans. 
End Summary. 
 
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VISA WAIVER - BROAD AGREEMENT 
----------------------------- 
 
¶2. (C) Pekala updated Parliament Speaker Katalin Szili on 
developments in the Administration,s effort to revamp the 
visa waiver program (VWP) by strengthening its security 
elements and working toward flexibility that would allow the 
entry of new countries.  Echoing remarks made by 
representatives of the government and opposition parties at a 
dinner hosted by Ambassador Foley the night before, Szili 
thanked us for our efforts on visa waiver and underlined that 
it is an issue that nearly all Hungarians follow and take a 
personal interest in.  (She even cited her hairdresser as 
having asked her about the status of Hungary's inclusion in 
the VWP during her last appointment.)  Szili agreed that the 
VWP would become a vehicle to help maintain the excellent 
relationship between the United States and Hungary via travel 
and exchanges.  By contrast, FIDESZ parliamentary faction 
leader Tibor Navracsics cautioned that a failure to address 
the issue could cause "drift" between the U.S. and its 
Eastern European Allies. 
 
¶3. (C) In a separate meeting with Pekala, Andras Gulyas, 
Foreign Policy Advisor to President Solyom, emphasized the 
President's interest in the status of the VWP.  He indicated 
that Solyom sees the visa as primarily symbolic and feels 
that Hungary's inclusion would show a certain equality by 
allowing Hungarians to travel to the U.S. visa-free in the 
same way that U.S. citizens may travel to Hungary.  Gulyas 
also underscored Solyom's continued concerns about individual 
rights under any visa regime where personal data is 
collected.  Gulyas also noted in closing that Hungary had 
paid a cost for its recent activism in Cuba with the recall 
of the Cuban Ambassador for consultations and "questions" 
within the EU. 
 
------------------------------ 
ENERGY SECURITY - OPEN DISCORD 
------------------------------ 
 
¶4. (C) When Pekala raised energy security and described U.S. 
efforts to work with countries toward the goal of 
diversification, Gulyas  noted that the early 2006 shocks to 
energy supplies in Hungary caused by Russia were a timely 
warning to work on coordinated energy security policy.  He 
said that he hopes that the U.S. will continue to monitor the 
situation in Hungary closely and watch how it is progessing 
on such a policy and "catching up" with the rest of Europe. 
 
¶5. (C) Laszlo Valki, Chairman of PM Gyurcsany's new Foreign 
and Security Policy Council, indicated that he sees Blue 
Stream as a more viable option but feels Russia is not a 
predictable partner.  He reported that the Russians had not 
provided any definite details on Blue Stream during PM 
Gyurcsany's recent visit to Moscow, characterizing the visit, 
as well as Russo-Hungarian relations in general, as 
"businesslike."  Valki did comment, however, that the Nabucco 
pipeline project appears to be encountering "opposition from 
many sides," including the recent withdrawal of a French gas 
company and the problems posed by the potential reliance on 
unstable suppliers such as Turkmenistan and Iran.  Pekala, as 
in the meeting with Gulyas, stressed the importance of 
diversification.  He informed Valki that the U.S. was in 
extensive discussions with Azerbaijan on, among other topics, 
the supply of gas to Nabucco. 
 
¶6. (C) In contrast to Valki's assessment of Blue Stream as 
the more viable option, Foreign Affairs Committee Chair, and 
FIDESZ MP, Zsolt Nemeth charged (in a separate meeting with 
Pekala) that Gyurcsany and the MSZP with downplaying Russia's 
true intentions and characterizing the question as an 
economic one and not a security issue.  Nemeth charged that 
"that Russian imperial instinct" is alive and well, and added 
that opposition efforts to speak out against Blue Stream are 
met with government claims of "Russophobia."  Nemeth 
continued that the MSZP labels Nabucco as "unrealistic" 
 
BUDAPEST 00000504  002 OF 002 
 
 
whenever possible - when in fact Blue Stream is also beset by 
serious technical, supply, and investment problems - and only 
under pressure resorts to claims of neutrality in the Blue 
Stream - Nabucco debate.  Nemeth suggested that the way to 
quiet the critics of Nabucco is to get Central Asian gas into 
the pipeline as soon as possible.  He also noted that the 
opposition will try for a parliamentary declaration welcoming 
the Berlin Summit, supporting Nabucco, and focusing on EU 
common energy policy. 
 
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BALKANS 
------- 
 
¶7. (C) Szili briefly touched on the Balkan issue, emphasizing 
Hungary's interest and agreeing with Pekala,s basic points 
that European and U.S. support of the Ahtisaari plan should 
be unanimous and that Serbia must see a future for itself in 
Europe.  Toward that end, Hungary sponsors what she called a 
"tolerance program" in Serbia where they use youth summer 
camps and economic programs to promote tolerance and unity 
across ethnicities.  Szili is also eager to confirm Speaker 
Pelosi's attendance at a June meeting with her Balkan 
counterparts. 
 
¶8. (C) Gulyas expressed support for the principle of minority 
rights in general and for Ahtisaari in particular, 
highlighting concerns about the impact of a Kosovo settlement 
on the delicate dynamic in the Vojvodina. 
 
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OUTREACH 
-------- 
 
¶9. (U) DAS Pekala gave an interview to Hungarian weekly "Heti 
Valasz" where he provided U.S. views on VWP, energy security, 
relations with Russia, missile defense and the Balkans. 
 
¶10. (U) He also held a town hall meeting, attended by Embassy 
staff, where he discussed policy and management issues and 
took questions from the audience on both subjects. 
 
¶11. (U) Septel will provide details of discussions on missile 
defense. 
 
¶12. (U) DAS Pekala has cleared on this message. 
FOLEY