VZCZCXRO1854
RR RUEHDBU RUEHFL RUEHKW RUEHLA RUEHNP RUEHROV RUEHSR
DE RUEHHE #0211/01 1561554
ZNY CCCCC ZZH
R 051554Z JUN 09
FM AMEMBASSY HELSINKI
TO RUEHC/SECSTATE WASHDC 4998
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE

C O N F I D E N T I A L SECTION 01 OF 02 HELSINKI 000211 
 
SIPDIS 
 
NSC TO J. HOVENIER 
 
E.O. 12958: DECL: 06/05/2015 
TAGS: EIND ENRG FI PGOV PREL
SUBJECT: FINLAND: PM PUTIN SETS CHILLY TONE WITH PM VANHANEN 
 
REF: 09 HELSINKI 151 
 
Classified By: Charge d'Affaires Michael A. Butler for reasons 1.4(b) a 
nd (d) 
 
¶1. (C) SUMMARY.  Russian Prime Minister Putin set a chillier 
tone in his June 3 visit to Finland than did President 
Medvedev last April.  Finnish officials found Putin less 
cordial and less engaged than Medvedev on the bilateral trade 
matters that dominate high-level Finnish-Russian meetings. 
In his meeting with Prime Minister Vanhanen, Putin placed 
natural gas high on his agenda, first issuing a warning that 
Ukraine's failure to pay up front for gas could create a 
"crisis" later this month, then urging the Finns to quickly 
conclude an environmental assessment of the Nord Stream 
pipeline project.  The Finns could offer no promise of a 
swift and certain resolution to Nord Stream, and they 
received no clarity on their main trade concerns, an increase 
in Russian wood export tariffs and a decision excluding trade 
via road in favor of rail and ship. The overall lighter tone 
of Medvedev's visit over Putin's has not left Finns hopeful 
that resolution of persistent bilateral problems would come 
from the President's office, as Finnish officials consider 
Putin to be in charge.  Finnish officials hope that the 
twice-annual high-level meetings themselves create pressures 
to resolve problems, a hope diminished by Russin policies 
they see having little substance and oherence.   END SUMMARY. 
¶2. (C) On June 3 RussianPresident Vladimir Putin visited 
Finland where h me with Prime Minister Vanhanen and 
President alonen.  In discussing the Vanhanen-Putin 
meetins, various officials from the Ministry of Foreign 
Affairs said they focused largely on bilateral economic and 
trade matters.  Finnish officials found tone of the 
Putin-Vanhanen meeting less cordial than President Dmitry 
Medvedev's meetings during his first State visit to Finland 
last April (REF). Putin also appeared less prepared than 
Medvedev and was less talkative, leaving other Russian 
officials to address many points.  Finnish media described 
the meetings as "chilly," and one journalist described 
Putin's impatient attitude at a post-meeting press conference 
as "strange."  The atmosphere likely warmed for the 
Putin-Halonen meeting, which lasted well beyond the scheduled 
hour.  (NOTE: Foreign Ministry officials could only 
back-brief on the earlier Vanhanen meeting, not the Halonen 
meeting, which ended at roughly 10 p.m.  Septel on Halonen's 
meeting to follow.  END NOTE.) 
Putin wants Nord Stream decision 
-------------------------------- 
¶3. (C) Though bilateral issues dominated, two wider topics 
arose.  As with Medvedev's visit, the Finns raised the 
question of Russia joining the World Trade Organization, and 
Putin echoed Medvedev's response that Russia had done what it 
could and the matter was in others, hands. Putin raised 
energy and natural gas.  Putin first spoke of Ukraine, saying 
that if Ukraine was unable to meet its obligations Russia 
would require advance payment for gas.  He then gave a 
"strong warning" that there could be a crisis at the end of 
June should Ukraine fail to pay. 
¶4. (C) The Finns took Putin's underlining of the problem with 
Ukraine as a blunt hint about progress on Nord Stream, the 
proposed natural gas pipeline that would pass through Finnish 
waters.  Turning from Ukraine to Nord Stream, Putin said that 
Russia does not need the pipeline, that it is something 
"Europe" wants.  Nevertheless, he strongly urged the Finns to 
quickly conclude their ongoing environmental assessment. 
Vanhanen replied that the government would follow the 
appropriate environment review process but added they would 
try to have a decision by early October.  (NOTE: Mikko 
Hautala, advisor to Foreign Minister Stubb, told Pol/Econ 
Chief officials expected a decision in favor of the project. 
However, approval would not conclude the Finnish government's 
role, and Nord Stream backers would need to secure a building 
permit in a process that would take them into 2010. END 
NOTE.)  Finnish officials sensed in Putin the irritation of 
other Russian officials who have discussed Nord Stream with 
the Finns, i.e.,  the inability to grasp the Finns, refusal 
to interfere with or supersede a neutral government process. 
Finns frustrated with tariffs and transport 
------------------------------------------- 
¶5. (C) Vanhanen raised with Putin two issues that Finnish 
officials say exemplify the complete lack of industrial 
policy in Russia.  Vanhanen followed up on the Russians, 
decision last year (following a Vanhanen request to Putin) to 
defer an increase in the roundwood export tariff, which 
threatens an already ailing Finnish wood industry. Putin 
replied that the government would decide the matter in the 
autumn.  Later, Finnish officials greeted with great 
skepticism Putin's assertion in the post-meeting press 
conference that the Russian wood industry had seen 
investments since the government imposed the tariffs.  They 
acknowledge that their wood industry is in dire straits, but 
 
HELSINKI 00000211  002 OF 002 
 
 
they see opportunities in matching Finnish expertise and 
investments with Russian resources.  The officials believe 
the export tariffs have hurt investment in the Russian 
market, something Russian officials fail to grasp. 
¶6. (C) Vanhanen also raised with Putin his concern about the 
Russian custom authority's decision that in six months trade 
must move via rail or ship, not via road, a decision Finnish 
officials say would be hugely detrimental to their economy 
and that they cannot implement in that time frame.  Putin 
surprised the Finns by justifying the decision on the amount 
of "contraband" passing out of Russia through Finland. 
According to Finnish officials, Finnish-Russian cooperation 
on customs and boarder issues is excellent, and no Russian 
official has pointed to contraband as a concern; they also 
assert the Russian transport ministry does not support the 
custom authority's decision. 
Custody case causes a stir 
-------------------------- 
¶7. (C)  Vanhanen discussed with Putin the custody case of 
five-year-old Anton Salonen.  Salonen's Russian mother took 
him to Russia and his Finnish father sought his return 
through the Russian courts.  Though the father obtained 
official decisions in his favor, border officials prevented 
Salonen's return to Finland and father and son sought support 
from the Finnish consulate in St. Petersburg.  In May a 
Finnish diplomat placed the two Salonens in the truck of his 
car and crossed into Finland.  Finnish officials expressed 
surprise to Pol/Econ chief at Putin's harsh public 
denunciation of the diplomat.  Foreign Minister Stubb 
publicly brushed away the comment, stating that "good 
neighborly relations" include speaking directly about such 
matters.  Putin did not call for the boy's return. 
¶8. (C) COMMENT.  It appears Putin is more comfortable meeting 
with, and speaking publicly alongside, his former counterpart 
President Halonen than with his current one, Prime Minister 
Vanhanen.  Any frustration exhibited in the Vanhanen meeting, 
perhaps stemming from a lack of movement on long-standing 
bilateral issues like Nord Stream and wood tariffs, and new 
ones like proposed transport restrictions and the Salonen 
custody case (which Putin acknowledged learning about on the 
flight to Helsinki) would not be as strong with Halonen, 
given Putin's long and warm relations with the President. 
The overall lighter tone of Medvedev visit over Putin's has 
not left Finns hopeful that resolution of persistent 
bilateral problems would come from the President's office, as 
Finnish officials consider Putin to be in charge.  Finnish 
officials hope that the twice-annual high-level meetings 
themselves create pressures to resolve problems, a hope 
diminished by Russian policies they see having little 
substance and coherence.  END COMMENT. 
BUTLER