VZCZCXRO1890
PP RUEHDBU RUEHFL RUEHKW RUEHLA RUEHNP RUEHROV RUEHSL RUEHSR
DE RUEHUP #0026/01 0191445
ZNY CCCCC ZZH
P 191445Z JAN 10
FM AMEMBASSY BUDAPEST
TO RUEHC/SECSTATE WASHDC PRIORITY 4812
INFO RHMCSUU/DEPT OF ENERGY WASHINGTON DC PRIORITY
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC PRIORITY
RUEHZL/EUROPEAN POLITICAL COLLECTIVE

C O N F I D E N T I A L SECTION 01 OF 04 BUDAPEST 000026 
 
NOFORN 
SIPDIS 
 
DEPARTMENT FOR EUR/CE JAMIE MOORE. 
NSC FOR JEFF HOVENIER. 
 
E.O. 12958: DECL: 01/14/2015 
TAGS: PREL ENRG EPET EINV MARR MOPS PHUM RS LO HR
HU 
SUBJECT: AMBASSADOR'S INTRODUCTORY MEETINGS: 
AFGHANISTAN/ENERGY SECURITY/SLOVAK RELATIONS MAJOR THEMES 
 
REF: A. BUDAPEST 687 
     ¶B. BUDAPEST 881 
     ¶C. BUDAPEST 787 
 
Classified By: Political/Economic Counselor Paul C. O'Friel 
for reasons 1.4 (b) and (d). 
 
¶1.  (C) SUMMARY.  The Ambassador made January 11-14 
introductory calls on President Laszlo Solyom, Prime Minister 
Gordan Bajnai, and Foreign Minister Peter Balazs.  Although 
the most substantive meeting was with Prime Minister Bajnai, 
each of the Ambassador's Hungarian interlocutors stressed the 
strength of the U.S.-Hungarian bilateral relationship.  Prime 
Minister Bajnai told the Ambassador Hungary intends to plus 
up its promised additional commitment to Afghanistan to a 
total of 235 troops and is focused on concluding as rapidly 
as possible the memorandum of understanding to add four USAID 
experts to the Baghlan Provincial Reconstruction Team. 
Worried about Russian dominance of its energy supplies, 
Hungary will try to broaden support for the Nabucco project 
in the upcoming Visegrad-4 Summit, as well as pursue the 
construction of a liquefied natural gas project with Croatia. 
 Bajnai hopes that tensions with Slovakia over the new Slovak 
language law would not be exploited in either country's 
upcoming electoral campaigns, but said he would be forced to 
respond to any provocation.  END SUMMARY. 
 
AFGHANISTAN/GUANTANAMO DETAINEE 
DECISIONS BASED ON COMMON VALUES 
-------------------------------- 
 
¶2.  (C) Prime Minister Bajnai said he believed that the 
strong strategic relationship between Hungary and the United 
States was based on common values, and that this belief had 
guided his decision to accept a Guantanamo detainee and to 
increase the size of the Hungarian contingent in Afghanistan. 
 He noted the differing reactions within the EU to the 
request for further allied help, contrasting the readiness of 
Hungary and Poland to respond with the hesitancy of France 
and Germany.  Bajnai said he intended to push for greater 
action at the upcoming London conference, saying, "The larger 
we all go in, the faster we all will get out."  He added that 
after consultations with the Ministry of Defense, Hungary 
would increase its initial commitment of 200 additional 
troops to a total of 235 more soldiers.  (Comment. In a 
January 15 meeting, Ministry of Defense Policy State 
Secretary Jozsef Bali told PolOff that he was unaware of any 
increase in troops above the 200 offered by the Prime 
Minister in his meeting with the Vice President in December. 
However, Bali confirmed that the Prime Minister and Finance 
Minister had recently met to source funding for the 
additional troops from 2010 budget reserves.  End Comment.) 
Bajnai said he hoped to conclude as rapidly as possible the 
draft memorandum of agreement to add four USAID experts to 
the Hungarian Provincial Reconstruction Team in Baghlan 
Province, and would follow up with the Ministry of Defense on 
the current status.  The Ambassador said both the President 
and Vice President were grateful for Hungary's efforts. 
 
ENERGY SECURITY 
--------------- 
 
¶3.  (C) Bajnai said he was pursuing three courses of action 
to diversify Hungary's energy supplies. 
 
-- The Nabucco pipeline was his top priority.  Bajnai said 
his goal was to establish an EU Nabucco Commission, as well 
as an international board of high-level political 
representatives on which the United States could sit as an 
observer. 
 
-- South Stream was the second alternative.  Although this 
still meant Russian gas, it provided another route to the 
problematic Ukrainian pipeline.  Commenting on recent press 
reports of an imminent signing of a South Stream feasibility 
study agreement, Bajnai downplayed the news.  He said while 
the former Gyurcsany government had embraced South Stream, he 
had postponed the signing ceremony until he had a better 
understanding "of the whole Russian position."  (Note.  See 
septel reporting on South Stream.  End Note.) 
 
-- The proposed Krk Island liquefied natural gas terminal in 
Croatia and the interconnecting pipeline offered the best 
fully independent, relatively reliable, short-term solution 
in that it was cheaper and easier to implement than Nabucco. 
 
BUDAPEST 00000026  002 OF 004 
 
 
Bajnai said he would meet his Croatian counterpart, Jadranka 
Kosor, on January 18 in Zagreb to discuss how best to move 
forward.  (Note:  Bajnai was quoted in the Hungarian press as 
announcing following the meeting that an inter-connecting gas 
pipeline between Hungary and Croatia would be completed by 
the end of 2010 and fully operational by the middle of 2011. 
The pipeline would be capable of annually carrying 6.5 
billion cubic meters of gas.  End Note.) 
 
¶4.  (C/NF) Bajnai expressed sharp concern about Russian 
efforts to corner the energy market in the Western Balkans. 
He pointed to moves in Croatia, Bosnia, and Slovenia to take 
over Hungarian energy conglomerate MOL's interests.  "Using 
business methods, they (the Russians) are making a strong 
push; it's a major strategic problem," Bajnai said.  He 
appreciated U.S. help in persuading Croatia not to divert 
from its previous EU orientation. 
 
¶5.  (C) President Solyom and Foreign Minister Balazs also 
focused on similar themes.  Solyom said Hungary was very 
concerned about its dependence on Russia and would continue 
to pursue the Nabucco pipeline project as a means to 
diversify its energy supplies.  Balazs stressed it was "a 
burning issue" for Hungary, saying, "We badly need 
alternative solutions." 
 
¶6.  (C) Regarding Russia Balazs said, "The main problem with 
Russia is that it is unpredictable; Russian money isn't any 
different than anyone else's money, but we would like to know 
the intentions of Russian investors."  He added, "When 
Mercedes makes an investment it is predictable and 
transparent, but when Russia makes an investment, in 
(Hungarian oil giant) MOL for example, their intentions are a 
bit foggy." 
 
¶7.  (C) In all of her meetings, the Ambassador emphasized 
that Washington agreed that it was imprudent to rely on a 
single energy source.  Nabucco offered the best mid-range 
alternative for Hungary's energy needs.  She noted Special 
Envoy Morningstar's close involvement in the issue, stressing 
Morningstar's commitment -- schedule permitting -- to attend 
the upcoming meeting of the Visegrad-4 summit, which would 
focus on energy security as one of its major themes. 
 
AMBITIOUS PLANS FOR VISEGRAD-4 SUMMIT 
------------------------------------- 
 
¶8.  (C) Prime Minister Bajnai stated he had high hopes for 
the February 24 Visegrad-4 Summit. Beyond the core group of 
the Czech Republic, Slovakia, and Poland, Bajnai said he 
expected the prime ministers of Bosnia, Serbia, Croatia, 
Romania, and Bulgaria to attend.  Saying that he wanted it to 
be a very significant event, Bajnai said his ambition was to 
produce a joint statement on energy security and launch the 
start of international cooperation on coordination mechanisms 
and pipelines. 
 
¶9.  (C) Looking beyond energy security, Bajnai said he hoped 
to use the venue to discuss Roma integration and NATO's new 
Strategic Concept.  He stated that he planned to host on 
February 25, the day following the Summit, a discussion of 
the Danube Strategy, an EU initiative building on the 
successful Baltic Sea Strategy that would address broad 
ecological, transport, and socio-economic needs.  Bajnai has 
also invited former Secretary of State Madeleine Albright to 
brief the Summit on the NATO review she is leading. 
 
HUNGARIAN THOUGHTS ON NATO'S NEW STRATEGIC CONCEPT 
--------------------------------------------- ----- 
 
¶10.  (C) On the issue of NATO's new Strategic Concept, 
Minister Balazs separately told the Ambassador that although 
Hungary was not part of the "Wise Men Group," he had 
assembled a cross-party group of "wise men" to think "very 
seriously" about NATO.  From the Hungarian perspective, 
Balazs said there were three important issues: 
 
-- Article V: It was critical to interpret Article V more 
broadly to account for global threats to common security.  We 
have to keep our eyes wide open and be ready to take 
preventive extra-territorial action whenever and wherever 
needed, Balazs said. 
 
-- Russia-NATO Cooperation: NATO had to manage its 
relationship with Russia constructively.  Balazs said Hungary 
 
BUDAPEST 00000026  003 OF 004 
 
 
was happy with the decision to renew the NATO-Russia Council. 
 
 
-- NATO Enlargement: Given the challenges in the Western 
Balkans, the prospect of NATO membership offered a means to 
help stabilize the situation.  Balazs observed that in Bosnia 
the army was the only institution in which the three groups 
-- Serbs, Croats, and Bosniaks -- came together, and 
advocated being "more courageous" about NATO's Membership 
Access Plan (MAP).  Balazs stated Hungary, however, was more 
cautious about extending the MAP to its eastern neighbors 
like the Ukraine.  "Let's wait and see," he said. 
 
 
HUNGARIAN-SLOVAK RELATIONS: 
TENSIONS PERSIST OVER SLOVAK LANGUAGE LAW 
----------------------------------------- 
 
¶11.  (C) Bajnai commented that although from the outside the 
Hungarian-Slovak dispute over the new Slovak language law 
might look like "two kindergarten kids wrestling in the mud," 
the tension had the potential to become a serious diplomatic 
issue.  He said he had tried to work with his Slovak 
counterpart, Prime Minister Fico, to tone down the tensions 
(ref a).  Nonetheless (according to Bajnai), despite the 
progress two sides made after their September 2009 meeting, 
by December the Slovaks had "stepped out of the process." 
 
¶12.  (C) The Ambassador noted that the United States was 
hopeful that the Organization for Security and Cooperation in 
Europe (OSCE) could play a helpful role in finding a 
solution.  Bajnai replied that Hungary was disappointed that 
the OSCE had backed away from its initial 26 recommendations, 
but was still seeking to keep the OSCE involved.  Noting that 
elections would soon be taking place in both countries, 
Bajnai said he hoped that the minority issue will not be 
exploited in either campaign to obtain votes.  He cautioned 
that he would have to react in the case of any provocation. 
(Note:  President Solyom also highlighted the need to protect 
the cultural rights of Hungarians living outside the borders. 
 End Note.) 
 
¶13.  (C) Bajnai stressed that on the Hungarian side he had 
taken and would continue to take strong action against any 
domestic terrorist organization that targeted minorities.  "I 
will not allow it," he said. 
 
ROMA INTEGRATION A "STRATEGIC QUESTION" 
--------------------------------------- 
 
¶14.  (C) Bajnai stated that he viewed Roma integration as a 
"strategic question" that would be the top political issue in 
Hungary over the next ten years.  "We have to integrate," he 
emphasized, noting that his government had pursued 
affirmative action programs in the civil service, army, and 
police, had passed anti-segregation laws, and begun to 
rehabilitate run-down Roma communities.  Citing the Embassy's 
successful "Policing in a Multicultural Environment" seminar 
(ref b), Bajnai stated he wanted to extend the training to 
"hundreds" of police officers.  "We can benefit from your 
experience," he said. 
 
¶15.  (C)  President Solyom also spoke passionately about the 
Roma community.  Solyom said he hoped Hungary could learn 
from the U.S. example how to break down the barriers of 
segregation, and asked for help with Roma integration. 
 
¶16.  (C) Foreign Minister Balazs emphasized, too, his hope 
for U.S. help in combating intolerance.  "This is an urgent 
matter for us," he said, noting that even beyond the national 
elections in April the far-right might further solidify its 
position in the October 2010 local elections.  "Piece by 
piece, they might occupy symbolically and politically parts 
of the country." 
 
¶17.  (C) The Ambassador assured all three of her 
interlocutors that the Embassy had identified funds and stood 
ready to help in any way it could.  She noted that Secretary 
Clinton considered this issue a priority. 
 
BETTERING THE BUSINESS CLIMATE 
------------------------------ 
 
¶18.  (C) The Ambassador registered her concern with all her 
interlocutors about Hungary's business climate, especially 
 
BUDAPEST 00000026  004 OF 004 
 
 
after the adverse tender decision effecting U.S.-owned Slager 
Radio (ref c).  Prime Minister Bajnai said the Slager 
decision had been a blow to his efforts to restore trust in 
Hungary.  He noted, however, that the recent court decision 
in favor of Danubius, the other foreign-owned station shut 
out of the tender, showed Hungarian courts are independent. 
Bajnai added that he considered the open letter of nine 
chiefs of mission (including the U.S.) urging more 
transparency "a letter for Hungary not against Hungary." 
Bajnai agreed with the Ambassador it was important now to 
look ahead and prevent any reoccurrence. 
 
¶19.  (C) COMMENT:  Prime Minister Bajnai clearly has an 
ambitious agenda between now and the end of his term in 
April.  His track record thus far has been good, and we 
expect that he will achieve many, but not all, of his goals. 
Bajnai said he hoped to name a principal point of contact for 
Roma issues before the end of January.  We will look to 
engage quickly to identify how we can help Hungary's efforts 
to address the Roma issue. 
KOUNALAKIS