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03ZAGREB1298 2003-06-06 17:23:00 CONFIDENTIAL Embassy Zagreb
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					  C O N F I D E N T I A L  ZAGREB 001298 



E.O. 12958: DECL: 06/06/2013


B. STATE 153958

Classified By: Ambassador Lawrence G. Rossin for Reasons 1.5 (B, D)


1. (C) With its application for membership in the EU's
"in-box" and parliamentary elections around the corner, it is
extremely unlikely that the Croatian government will move any
closer to signing an Article 98 Agreement during your visit,
or even discuss texts. We expect their entire focus will be
to argue for a waiver. This will be one in a series of GoC
policy choices which have damaged our bilateral relationship
(ref A). Your visit represents the USG's "extra mile" effort
to prevent this outcome. We look forward to your visit and
to welcoming you to Zagreb.

The Environment


2. (C) Croatia submitted its formal application for EU
membership in December 2002. Since then, every single GoC
policy decision has been taken with a view towards how the
Racan Government believes it will be perceived by the
European Union. In the case of Iraq, that meant not only
declining our request to join the coalition of the willing,
but publicly crowing about it. On deciding whether to engage
toward signing an Article 98 Agreement, that meant taking the
Patten/Papandreou letter urging candidate countries'
adherence to EU guidelines as if it were Holy Writ and as if
Croatia was actually under active consideration for
membership in the near term.

3. (C) Croatia's coalition government came to power in
January 2000, bringing to an end the corrupt, nationalist
regime of Tudjman's HDZ. Apart from ejecting the HDZ,
however, the coalition parties had few major goals in common.
The Racan Government has managed to hang on through most of
its four-year mandate, but it has been a rocky ride,
including countless threats of resignations, several cabinet
reshuffles and one genuine government crisis. Although there
has been no formal announcement, the next parliamentary
election is widely expected to take place late this autumn.
All of Croatia's politicians believe the best way to get more
votes is to show that they are more pro-EU than their

The Arguments


4. (C) The USG has been pushing Croatia hard, both in
Washington and in Zagreb, to move forward on an Article 98
agreement. Although the GoC continues to tell both us and
the public that it has not made a formal decision, we
understand that the Racan Cabinet has already decided not to
sign. The excuses they will present in their meetings with
your delegation are by this time very familiar, as are the
reasons they believe Croatia's "special circumstances" make
it a good candidate for a national interest waiver.

-- EU Accession. While the GoC downplays this argument in
its discussions with us (since they know it carries little
weight), it takes the admonition in the Patten/Papandreou
letter very seriously and will not step outside the lines set
out in the EU Common Positions. Despite all indications that
the EU's bark is worse than its bite, the GoC has not
responded to our urging that it explore what the true,
limited repercussions of signing an Article 98 agreement
would be for its application for EU membership.

-- ICTY/ICC Linkage. Croatia's leaders have done nothing to
explain the differences between ICTY and the ICC to the
public. (They acknowledge the distinction to us in private.)
As a result, they not only presume, self-servingly, but also
make it more probable that voters would punish them for
allowing the U.S. to exempt its servicemembers while sending
Croatia's "heroes" to the Hague.

-- Regional Stability. The GoC believes that the U.S. should
understand that Croatia is irreplaceable as we seek to build
stability in the region. Cutting U.S. military assistance
would not only slow Croatia's progress toward NATO
membership, but would also impede its effort to increase the
security of its borders.

-- U.S. - Croatia Relations. The GoC believes that bilateral
military ties are the strongest part of our overall
relationship. IMET training in particular has been a solid
investment of good will and good intentions which is at risk
if the U.S. does not grant Croatia a national interest waiver.

-- Domestic Political Fallout. GOC leaders say that voters
will punish coalition parties if the GoC signs an Article 98
agreement. Since the opposition HDZ is still largely
undemocratic and supports policies which oppose our goals for
regional stability, the U.S. cannot afford to risk a return
to power of the right-wing nationalists. (This argument
holds little water since the HDZ has already called publicly
for the Croatia to sign an agreement.)

Likely Outcome


5. (C) While it is all but certain that the GoC will not
agree to sign an Article 98 agreement during your visit, it
will present its engagement with your delegation to the
Croatian public as a good faith effort to find common ground
and to make Croatia's case for a national interest waiver.
It also will likely seek to use the visit with us as evidence
of its serious effort to reach common ground -- i.e., for us
to grant a waiver.

Managing the Message


6. (C) Croatia's foreign ministry has already approached us
seeking to orchestrate a joint press conference and statement
with a view toward minimizing differences and papering over
the serious cracks in our bilateral relationship. That also
would mainly be for domestic consumption. We turned them
down and have instead organized a private interview for you
with a very solid journalist from Croatia's least
sensationalist daily newspaper where you will be able to lay
out the facts about ICC and Article 98 and have them reported