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Cablegate: Pm Karamanlis Tough On Macedonia Name, Pragmatic

VZCZCXYZ0005
OO RUEHWEB

DE RUEHTH #0021/01 0051258
ZNY CCCCC ZZH (CCY AD473669 MSI3766-695)
O 051258Z JAN 08 ZDS
FM AMEMBASSY ATHENS
TO RUEHC/SECSTATE WASHDC IMMEDIATE 0978
INFO RUEHXD/MOSCOW POLITICAL COLLECTIVE PRIORITY
RUEHZG/NATO EU COLLECTIVE PRIORITY
RUEHSQ/AMEMBASSY SKOPJE PRIORITY 1130
RUEHPS/USOFFICE PRISTINA PRIORITY 0344

C O N F I D E N T I A L ATHENS 000021

SIPDIS

SIPDIS

C O R R E C T E D COPY TEXT

E.O. 12958: DECL: 01/05/2018
TAGS: PREL PGOV GR
SUBJECT: PM KARAMANLIS TOUGH ON MACEDONIA NAME, PRAGMATIC
ON TURKEY, RUSSIAN ENERGY


Classified By: AMBASSADOR DANIEL SPECKHARD. REASONS 1.4 (B) AND (D).

1. (C) SUMMARY: In his first meeting with the Ambassador,
Prime Minister Kostas Karamanlis took a hard line on te
Macedonia name issue, saying he had "done hs part," while
Skopje had become increasingly intransigent. A mutually
acceptable solution -- which could include a composite name
of "New, Upper, North, whatever Macedonia" for use in
international fora and another name (i.e., the constitutional
name) for internal use -- had to be found now before the NATO
Bucharest summit or Greece would not approve FYROM's entry
into Euro-Atlantic institutions. On Kosovo, Karamanlis was
less categorical, noting that Greece could understand U.S.
concerns about delayed independence leading to instability.
Nevertheless, Karamanlis said that the period after the
Serbian elections could offer one more hance for
negotiations to lead to a mutually cceptable solution. On
energy, Karamanlis arued that the Russians were going to
build the South Stream gas pipeline, if not through Greece
then somewhere else, so it was in Greece's interest that it
go through Greece. On Turkey, he said relations were better
now than in the past and that he had a good relationship with
PM Erdogan. Karamanlis confirmed his visit to Turkey in
January, and while he was "not optimistic" about a
breakthrough, such a visit could have a long-term positive
impact on bilateral relations. END SUMMARY.

PRIORITIES
----------

2. (C) The cordial January 4 meeting began with the
Ambassador and Karamanlis providing overviews of their
respective priorities. The Ambassador said he was focusing
his attention on four areas: 1) working with Greece to
increase stability in the Balkans (including supporting
efforts to find a solution to the Macedonia name issue and
address the situation in Kosovo); 2) promoting regional
stability in the Eastern Mediterranean (including supporting
improvements in relations between Greece and Turkey and
working toward a solution of the Cyprus problem); 3) working
with Greece to combat domestic and international terrorist
threats; and 4) promoting economic development (including
promoting Greek and European energy security, bilateral trade
and investment, and economic development in the wider Balkan
region). Karamanlis agreed this was a good set of priorities
and spoke of the very close relations and similarity of
outlook between the U.S. and Greece. Greece's policy in the
region had three basic goals: 1) promotion of the EU as the
primary stabilizing factor in Europe; 2) changing the Balkan
tradition of conflict to one of cooperation; and 3) seeking
good relations with Turkey. Karamanlis admitted Greece was
not yet ready to be a leader in the EU -- its economy needed
greater vitality -- but Greece was now at the top of the
middle of the EU countries, as opposed to being at the bottom
in the 1980s. In terms of domestic priorities for 2008,
Karamanlis said he would focus on reforms of the pension
system (this was "our historical duty and had to be
accomplished regardless of the political costs"),
privatization, including leasing of major ports at Piraeus
and Patras and the selling of Olympic airways, and education
reform, including creating a legal framework for private
universities in Greece.

MACEDONIA NAME ISSUE
--------------------

3. (C) Karamanlis took a hard line on the Macedonia name
issue. He said Greece wanted the entire Balkan region to be
incorporated into Euro-Atlantic institutions and to
assimilate Western values, which would improve stability and
further economic development. But, Karamanlis said, "let me
be very frank, I think I have done my part." According to
the PM, Greek public opinion earlier had been very opposed to
any use of the name "Macedonia," but following UN negotiator
Nimetz's forward-leaning proposal two years ago, Greece under
Karamanlis's leadership took the "bold step" of accepting
Nimetz's proposal as a basis of negotiation, which came at
tremendous political cost to Karamanlis and the New Democracy
party (support in Karamanlis's home region of Greek Macedonia
slipped from more than 50 percent to 40 percent). Greece was
open to a composite name -- "New, North, Upper, whatever
Macedonia." But a compromise was essential, Karamanlis
argued, and so far FYROM remained intransigent, which
Karamanlis attributed, in part, to the U.S. decision to
recognize Macedonia by its constitutional name.

4. (C) Karamanlis said he had told FYROM leaders that any
Greek government going further would be thrown out of office.
Thus, it was essential to find a mutually acceptable
solution now. In response to the Ambassador's query as to
whether it would be possible to work to show real progress
and commitment in the negotiations before the NATO Summit,
while leaving the ratification period for finalizing an
agreement, Karamanlis insisted that this would not be
acceptable and an agreement needed to be reached before the
Summit. Without a solution, he said, "we cannot approve
FYROM's entry into Euro-Atlantic institutions." As for
Nimetz's proposal for a two-name solution (Republic of
Macedonia for internal use and a composite name for the UN,
NATO, and other international usage), Karamanlis said Greece
could live with that, but the composite name had to be used
in all international fora, and Greece expected the U.S. to
use the composite name as well.

KOSOVO
------

5. (C) Karamanlis was less categorical on Kosovo. He said
Greece understood U.S. arguments about a delay in
independence for Kosovo would foster further instability, but
Greece wanted to find a solution that would avoid extremes
and be more "swallowable." Greece understood there would be
no UDI before Serbian elections, and after the elections,
negotiations should be given another try. In his meetings
with his Serbian counterpart last year, he felt that there
was an understanding of the inevitability of independence but
also heard a plea for "autonomy" as a step on the road to
making independence politically palatable. "Autonomy can
always evolve into independence," the Serbian PM told him.
The Ambassador highlighted the U.S. position of support for
the Ahtisaari plan and urged the PM to use his and Greece's
influence to encourage Serbia to recognize that Kosovo was
lost and to act now in their own self interest in pursuing
European integration for Serbia and Kosovo as the best way to
protect Serbian interests in the region. The PM said Greece
would work within the EU to find a consensus, which was
essential in promoting stability during this tense period.

6. (C) On Russia's position on Kosovo, Karamanlis noted that
Putin during Karamanlis's December visit to Moscow was
surprisingly less "aggressive" on the issue than previously.
Three years ago, Putin had done an hour-long monologue on
Ukraine, and Karamanlis expected something similar on Kosovo
in December. While Putin's arguments on Kosovo remained the
same, it was clear this time that Kosovo was "not his highest
priority."

RUSSIA AND ENERGY
-----------------

7. (C) Speaking in broader terms about Russia, Karamanlis
opined it was a nation with a great, if tragic, history and
had felt "humiliated" in the 1990s. Now Russia was getting
richer and wanted to be part of the "leading team." Putin
obviously was "no teacher of democracy," but on basic issues,
such as global stability and battling terrorism, Russia could
be counted as a partner. There was "no doubt" that Greece's
values would not change, but Russia was an important country
and Greece needed good relations with it. For one, many more
Russian tourists were now coming to Greece. Then, of course,
there was the energy question.

8. (C) Karamanlis said he Burgas-Alexandoupolis oil pipeline
had been in the works for 20 years, so that was nothing new.
As for the Russian South Stream gas pipeline, Karamanlis said
the Russians were going to build it, if not through Greece,
then somewhere else. Thus, "it's better for us if it's
through Greece." On the Ambassador's concern that South
Stream could overshadow the Turkey-Greece-Italy gas
interconnector (TGI) and confuse potential investors,
Karamanlis tried to downplay progress on South Stream. He
and the Bulgarian and Italian presidents had only said they
were "interested" in South Stream, but it would be "hard and
time-consuming" to get the project off the ground. As for
TGI, he told a Moscow story: Putin asked him what kind of
gas Greece thought it could get through TGI. Karamanlis
replied "Azeri," to which Putin retorted "they don't have
any." The PM, however, was pleased with the cooperation with
Azerbaijan and confident the project would proceed.

TURKEY
------

9. (C) Relations with Turkey were better than previously,
according to Karamanlis, particularly in terms of his
personal relationship with Turkish PM Erdogan. But he could
not say there had been any progress on substantive issues.
Karamanlis's January trip to Turkey, which the PM confirmed,
was a "very sensitive exercise," but one that might possibly
lead to a "breakthrough." Karamanlis was "not optimistic,"
but the visit could open a door. Elements in the Turkish
military appeared opposed, as was some of the Greek press.
There might not be any immediate progress on substantive
issues, but the visit could help strengthen relations in the
longer term.

10. (C) This was also why Greece supported Turkey's EU
accession. Greek public opinion rose and fell on the issue
depending on events in the Aegean, but from Karamanlis's
point of view the rational for EU membership was very simple:
a European Turkey would make a much better neighbor. The
Cyprus issue was not a Greece-Turkey bilateral issue, but it
did overshadow and complicate the EU question. Karamanlis
said that perhaps after the Cypriot presidential elections in
February there would be a window of opportunity to move
forward on the Cyprus issue. Whatever happened, Greece would
be "helpful."

COUNTERTERRORISM
----------------

11. (C) The Ambassador emphasized the importance of
cooperating on counterterrorism, particularly given Greece's
geo-strategic location near the Middle East. He also
underscored his determination to bring to justice the
perpetrators of the January 2007 RPG attack against the
Embassy. The PM assured the Ambassador of continued
cooperation on counterterrorism.

ADVICE FOR AMERICAN AMBASSADORS
-------------------------------

12. (C) Karamanlis concluded the meeting with some friendly
pointers on negotiating the Athens diplomatic scene. It was
very important for the U.S. Ambassador to be discrete.
Meddling with politicians or the press was unhelpful. Too
close relations with Greek politicos, journalists, and
prominent businessmen were also dangerous. Such contacts
could lead to one being dragged down into "Balkans gossip."


BIO NOTE
--------

13. (C) The meeting took place in Karamanlis's office at the
Maximou Palace. Journalists with cameras were at the gate
but had no opportunity to approach the Ambassador. During
the meeting, Karamanlis was very comfortable and gregarious,
often expressing his respect and affection for the United
States. There were virtually no pauses in the conversation,
and Karamanlis at times became animated, particularly when
discussing the Macedonia name issue and Kosovo. He sat on
the edge of his seat and took out his Greek worry beads. He
spent over an hour with the Ambassador, more than double the
allotted time.
SPECKHARD

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