NETHERLANDS/RUSSIA: FIRST STATE VISIT SINCE THE

C O N F I D E N T I A L SECTION 01 OF 02 THE HAGUE 002942

SIPDIS

STATE FOR EUR/RUS AND EUR/UBI

E.O. 12958: DECL: 10/28/2015
TAGS: PREL PGOV PHUM EPET NL RS
SUBJECT: NETHERLANDS/RUSSIA: FIRST STATE VISIT SINCE THE
CZAR


Classified By: Charge D'Affaires Andrew Schofer, reasons 1.4 (b,d)


1. (C) Summary: Described as the first Russian state visit
to the Netherlands since Czar Nicholas II, the Dutch plan to
receive Russian President Vladimir Putin on November 1-2 with
full "pomp and circumstance." The MFA expects a positive
visit with "good atmospherics" but little progress on
substantive issues. Investment, energy, and the fight
against terrorism will top the list of bilateral issues,
although the Dutch hope to broaden the discussion to include
human rights and integration of ethnic minorities. Putin's
trip will highlight several Dutch-Russian cultural themes,
although the recuperation of the Koenigs Collection remains a
sore point. Foreign Ministers Bot and Lavrov also will meet
on the margins to discuss a range of issues, including
Belarus, post-Soviet frozen conflicts, the Balkans, and Iran.
End Summary.

Nominal Putin Itinerary
--------------


2. (C) Henk Voskamp, Deputy Director of the MFA's Office of
Southeast and Eastern Europe, told Poloff on October 26 that
Putin's upcoming whirlwind visit to the Netherlands marks the
first formal state visit by a Russian head of state since
Czar Nicholas II. Putin will arrive in the Netherlands the
morning of November 1 and spend the majority of the day in
Amsterdam. Following the signing of a Road Transport Treaty,
Putin will meet the mayor of Amsterdam and then have lunch
with heads of industry. Putin will then visit the house in
which Peter the Great resided during his years in the
Netherlands, and end the day with a state dinner hosted by
Queen Beatrix at Noordeinde Palace in The Hague. A bilateral
meeting between PM Balkenende and Putin will take place on
November 2, followed by a visit to the Peace Palace and the
International Court of Justice (ICJ). (Note: Czar Nicholas II
was instrumental in the formation of the ICJ. End note.)
Putin will then depart the Netherlands in the early evening
of November 2.

Investment and Energy
--------------


3. (C) On October 21, Rob Swartbol, PM Balkenende's Senior
Foreign Policy Advisor, told Charge that investment and
energy would be the two most important issues on the
bilateral agenda for the visit. According to Voskamp, Russia
considers the Netherlands its second largest investor, after
Cyprus, but added that this perception might be a bit skewed
as Russia views many multinational corporations with
headquarters in the Netherlands and investments in Russia as
"Dutch" companies. Nevertheless, Dutch investment in Russia
is quite large, Voskamp said. (Note: Shell's Sakhalin II gas
project may cost as much as USD 20 billion alone. End note.)
Swartbol said Putin will try to make the case during the
lunch with industry heads that Russia's investment climate
has changed for the better. Voskamp said Putin also will
argue that Russia's accession to the WTO conflicts with its
bilateral investment treaty with the Netherlands. The Dutch
strongly disagree on this, and will push Russia to take steps
to better safeguard Dutch investments, Voskamp said.


4. (C) On energy, Voskamp noted that discussions continue on
long-term deals between Gazprom and Dutch counterparts. He
explained that these discussions are independent of the state
visit, and while he did not expect any movement, these
negotiations will provide "good atmospherics" for the visit.
Voskamp did not expect Putin to "play the bilateral card" to
divide EU members on energy issues during his visit. He
suggested that Russia has been fairly predictable when it
comes to energy issues as it seeks to obtain lucrative deals
or to diversify transport routes.

Terrorism or Something Broader
--------------


5. (C) Voskamp said Putin has requested an exchange of views
on fighting terrorism and religious extremism. Such a
perfunctory exchange would have limited utility -- no one
should doubt the Netherlands' commitment to fight terrorism,
especially as Putin's visit falls on the one year anniversary
of Theo Van Gogh's murder, he averred. He said the Dutch
welcome the exchange but suggested that PM Balkenende may
attempt to broaden the discussion to include human rights,
corruption, poverty, and discrimination -- issues that
certainly feed terrorism and religious extremism in Chechnya.
Voskamp expected a continuation of Putin's tough message --
terrorists are terrorists -- which has proven popular with
Russian voters. However, he pointed to recent statements in
the Duma emphasizing the integration of ethnic minorities in
the fight against terrorism; Balkenende might use these
statements to try and broaden the discussion beyond a simple
affirmation to fight terrorism.


6. (C) Swartbol also suggested that Balkenende may raise UN
reform, Georgia, and reform progress in Ukraine in addition
to the planned exchange on terrorism.

Cultural Issues
--------------


7. (C) Voskamp characterized the cultural aspect of Putin's
visit as overwhelmingly positive full of "pomp and
circumstance," albeit with one glaring sore spot. He said
Russia has expressed appreciation for the Netherlands' role
in promoting cultural exchanges and contributing toward the
recent commemoration of St. Petersburg. He emphasized
Dutch-Russian cultural ties, pointing to the branch of the
Hermitage in Amsterdam, and noted that the Dutch have a good
relationship with the highly-influential director of the
Hermitage in Moscow.


8. (C) The sore spot involves restitution of the Koenigs
Collection. (Note: Dutch businessmen Franz Koenigs collected
2671 drawings and paintings by old masters including Rubens.
He lost the collection in 1940 when he was unable to repay a
bank loan; the paintings were resold to various owners by the
bank. A quarter of the collection was illegally taken by the
Nazis out the Netherlands during World War II, and eventually
ended up in Russia as war spoils. End note.) Voskamp
explained that Russia has acknowledged the Dutch legal
procedure regarding the return of the stolen art, and even
informally agrees that the Dutch have a strong legal case.
However, Russia continues to view the collection as German --
and not Dutch -- and therefore is not obligated to return the
collection to either the Netherlands or a former enemy
combatant such as Germany. Voskamp suspected that Putin would
continue to stress sensitivity in the matter, and doubted any
resolution would be achieved during the visit.

Lavrov-Bot Bilat: Belarus, Frozen Conflicts, Balkans, Iran
-------------- --------------


9. (C) During Putin's visit, Foreign Ministers Lavrov and Bot
will also meet to discuss Belarus, "frozen conflicts" in the
post-Soviet states, and Iran. (Note: Bot and Lavrov last met
on the margins of the UNGA in September, and earlier during
Lavrov's visit to the Netherlands in June 2005. End note.)
Voskamp noted that the Netherlands hoped to coordinate
further with Washington on a strategy with Belarus, but added
that the EU was split over engaging Russia on the question of
further sanctions. He doubted much progress would be made
during the visit. Voskamp was more optimistic that Russia
might be cooperative regarding Transnistria, suggesting
resolution of the conflict was a common EU-Russia goal.


10. (C) On the Balkans, Voskamp noted that the Russians often
draw parallels "with a smile" between Transnistria and the
final status question in Kosovo. He said that Dutch policy
on the Balkans should be viewed in conjunction with the EU's
policy, and referred to the importance of the Eide report.
The Russian position on Kosovo seems very clear, he said:
while Moscow did not want to block progress on the
comprehensive review, progress should nevertheless be
determined by benchmarks and results -- and not an artificial
timetable.


11. (C) Voskamp anticipated a "clear cut" discussion on Iran
as Moscow obviously has commercial interests to protect. He
said the Netherlands fully supports the efforts of the EU3; a
"clear case" of non-compliance should be referred to the
UNSC. While Russia has supported the threat of referring
Iran to the UN Security Council, Voskamp noted the Russians
are afraid an actual referral would only serve to bolster the
regime in Tehran and possibly lead to regional instability.


12. (C) Voskamp said Bot might raise Uzbekistan, and that the
Netherlands and the United States share the same analysis of
the political situation in Central Asia. He added that the
Netherlands tends to look more closely at Kazakhstan due to
its stronger political and commercial presence. But it was
also clear that Moscow supports actions by the Uzbek
government as consistent with its own efforts to fight
terrorism. Voskamp doubted Georgia would be raised, and
Ukraine only tangentially.

SCHOFER