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Cablegate: Netherlands/Russia: Balkenende Mixes Business

VZCZCXYZ0000
OO RUEHWEB

DE RUEHTC #1992/01 3191206
ZNY CCCCC ZZH
O 151206Z NOV 07
FM AMEMBASSY THE HAGUE
TO RUEHC/SECSTATE WASHDC IMMEDIATE 0689
INFO RUEHMO/AMEMBASSY MOSCOW PRIORITY 1754
RHEHNSC/NSC WASHDC PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RUEKJCS/CJCS WASHDC PRIORITY
RUEHZG/NATO EU COLLECTIVE

C O N F I D E N T I A L THE HAGUE 001992

SIPDIS


SIPDIS

E.O. 12958: DECL: 11/13/2027
TAGS: PREL PGOV KDEM ECON PINR IR RU KO NL
SUBJECT: NETHERLANDS/RUSSIA: BALKENENDE MIXES BUSINESS
WITH PRESSURE

REF: A. THE HAGUE 1985
B. POL/ECON IN THE NL 11/09/07 AND 11/14/07

Classified By: AMBASSADOR ROLAND E. ARNALL FOR REASONS 1.4(B/D).

1. (C) SUMMARY: During his November 5-8 visit to Moscow,
Dutch Prime Minister Balkenende engaged Russian President
Putin on tough issues such as Kosovo, Iran, and human
rights in addition to announcing a major multi-billion dollar
gas pipeline deal (reported septels). Balkenende believes
that strong economic ties with Russia and demonstrating
respect for Russian pride are the keys to influencing Putin.
Although Balkenende claimed to have delivered a strong and
clear message on the need to respect democratic norms, he was
later criticized in Parliament for appearing to place Dutch
economic interests ahead of human rights concerns. END
SUMMARY.

2. (C) In a November 13 meeting with Ambassador Arnall, Dutch
Prime Minister Jan Pieter Balkenende expressed satisfaction
regarding his November 5-8 visit to Moscow. Without directly
referring to the substantial new energy cooperation
agreements announced during the visit -- for which Balkenende
has been criticized in Parliament (refs) -- Balkenende argued
that the Netherlands' growing economic ties to Russia make it
possible to engage Russian President Putin directly on the
most difficult issues. Balkenende stressed that he did not
shy away from discussing sensitive issues, such as human
rights, both in public and in his private conversations with
Putin.

3. (C) Balkenende proudly noted that he and Putin were able
to conduct nearly all of their conversations in German,
which, he said, allowed for a more open and direct
conversation than working through translators. Putin, he
added, was obviously a clever guy who was well briefed on
every issue discussed. According to Balkenende, Putin
readily acknowledges that there are serious problems in
Russia, such as corruption, and was willing to listen to
constructive criticism. At the same time, however, Putin
remains sensitive to perceived slights to Russia's status as
a great power, and is motivated -- in Balkenende's view -- as
much by national pride as by geopolitical or economic
considerations. Treating Putin, and Russia, with respect,
therefore, is a necessary first step before engaging on tough
issues.

KOSOVO:
-------

4. (C) According to Balkenende, Putin showed little concern
over the lack of progress on Kosovo. Asked what would happen
if no agreement satisfactory to both sides can be reached by
December 10, Putin told Balkenende: then we go to December
11. Putin also reportedly tried to downplay the potential
for regional instability by noting that other countries in
Europe -- such as Belgium or Ireland -- are also divided
along ethnic, religious, or linguistic differences.
Balkenende dismissed these arguments and stressed that there
is no point in talking and talking without ever reaching a
solution. On the other hand, Balkenende made clear to
Ambassador Arnall that he is deeply worried about divisions
within the EU should Kosovo unilaterally declare
independence, a development that would post the most serious
challenge to the EU in fifteen years.

IRAN/MISSILE DEFENSE:
---------------------

5. (C) On Iran, Balkenende said he had impressed on Putin the
importance of maintaining a united front to ensure Iran does
not succeed in acquiring nuclear weapons. He also
underscored the key roles of the IAEA and the UNSC, and the
potential damage to their credibility should Iran continue to
ignore its obligations. Balkenende said Putin had
demonstrated a deep understanding of the situation and
appeared genuinely concerned. He added that the Russians
believed they had detected a new, more positive tone in their
recent dealings with Iran (and with Supreme Leader Khameini
in particular), but did not elaborate. (Note: Per ref A,
MFA Political Director Pieter de Gooijer is in Tehran this
week.)

6. (C) On the related issue of missile defense, Balkenende
was pleased that recent talks between senior U.S. and Russian
officials appeared to have taken some of the heat out of
Russian opposition to a U.S.-proposed missile shield in
Eastern Europe. That said, the sides clearly remained far
apart and it will be difficult to find a compromise. Putin,
he added, continued to push for increased dialogue between
Russia and NATO on this issue.

DEMOCRACY AND HUMAN RIGHTS:
---------------------------

7. (C) Balkenende was adamant that he was not afraid to raise
human rights concerns during his visit. He noted that he met
with NGO's working on civil society and rule of law projects
receiving assistance from the Netherlands. In his private
meetings with Putin, and in his press interviews, he had also
stressed the Dutch commitment to democracy and the rule of
law. (Note: Per ref B, Putin apparently later criticized
Balkenende for some of his public remarks.) Balkenende
stressed, however, that such comments would fall on deaf ears
if not accompanied by appropriate gestures of respect and
understanding for Russia's unique situation. Unlike the U.S.
or the Netherlands, Russia has had at most sixteen years of
democracy. Putin, he added, is admired internally for his
strong leadership -- to the point that most Western leaders
should and do envy his popularity ratings.

COMMENT:
--------

8. (C) Balkenende was obviously impressed by Putin and feels
that he is someone he can do business with -- literally, in
fact. The announcement of a multi-billion dollar accord
between Gazprom and the Dutch gas company GasUnie during the
visit opened the Prime Minister to criticism -- including
from some members of his own party -- for appearing to place
Dutch economic interests ahead of human rights' concerns.
The fact that the deal was announced the same week the
Foreign Minister publicly presented the Cabinet's new, more
aggressive international Human Rights Policy to Parliament
only heightened the contrast and further motivated
Balkenende's opponents to attack him; at one point, Foreign
Minister Verhagen found himself calling the Prime Minister in
Moscow directly from Parliament for guidance. Several
contacts have since acknowledged that holding the two events
so close together was a serious miscalculation.
Arnall

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