AUSTRIA'S 2006 EU PRESIDENCY: CHANCELLOR

C O N F I D E N T I A L SECTION 01 OF 03 VIENNA 002699

SIPDIS

STATE FOR EUR/AGS (VIKMANIS-KELLER) EUR/ERA AND INR/EU

E.O. 12958: DECL: 08/04/2015

TAGS: PGOV PREL ECIN EFIN AU EUN
SUBJECT: AUSTRIA'S 2006 EU PRESIDENCY: CHANCELLOR


SCHUESSEL'S GAME PLAN

Classified By: Charge d'Affaires a.i. Carol van Voorst

Reasons: 1.4(b) and (d)


1. (C) Summary: Austrian Chancellor Wolfgang Schuessel

brings a formidable toolbox of political skills and savvy to

his task of directing Austria's EU presidency in the first

half of 2006. Ever conscious of the inherent limitations of

stepping into the Presidency from one of the EU's smaller

member states, Schuessel will try to avoid letting

controversial issues like the EU budget and disputes over

Turkish EU accession take over his Presidency agenda.

Instead, he will look for opportunities to achieve progress

in other areas, particularly the Balkans and law enforcement

cooperation. Domestic political considerations, including an

attachment to a traditional concept of neutrality and a

desire for commercial opportunities wherever they may arise,

shape Austrian approaches to international issues in ways

that sometimes run counter to U.S. interests. While

Schuessel is clearly interested in good relations with the

U.S., he sometimes has trouble finding the right tone. If

faced with an apparent conflict between major EU states and

the U.S., Schuessel's instinct will be to follow an EU

consensus. We should intensify efforts to define and

communicate our goals for the Austrian EU Presidency well in

advance of the January 1, 2006 start date. End summary.


2. (C) Austria's preparations for its Presidency during the

first half of 2006 are well underway. Lacking the global and

regional influence of the current UK Presidency, Austria will

strive to keep EU member states' expectations low even as it

forges ahead on key issues. In political terms, the

Austrians will define success as good management of the EU's

heavy agenda of meetings, culminating in a U.S.-EU Summit.

The Austrians will try to have an impact on certain

substantive issues, especially finding a way forward on the

EU's seven-year budget framework. However, they are

skeptical of their abilities to influence the EU heavyweight

nations. They abhor sticking their collective neck out, and

they have a tendency to opt for process rather than outcome.

These tendencies suggest Austria, as EU president, will favor

going along with the crowd rather than making waves.


3. (C) Chancellor Wolfgang Schuessel will be the

personification of the Austrian EU Presidency. Now in his

fifth year as Head of Government, Schuessel was Foreign

Minister during Austria's 1998 presidency, an experience

which inspired him to compile a booklet called "Eurospeak: A

Light-Hearted and Illustrated Key to EU Jargon." Schuessel

will bring confidence, experience, and considerable political

acumen to the Austrian Presidency. A good deal of U.S. time

and persuasion will be necessary, however, to get Schuessel

to invest himself in any U.S.-led initiatives that do not

have the full blessing of the EU powers.

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Schuessel's EU Priorities

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4. (C) BUDGET: Austria is a modest net payer into EU

coffers and prides itself on its good relations with the new

EU member states to its east. While this should enable

Austria to act as mediator on the budget question, this may

not be correct. Austria has a small but effective

agricultural lobby (an important constituent of Schuessel's

People's Party) which has a stake in continuing Common

Agricultural Policy disbursements. Schuessel will make his

best effort to facilitate an accommodation between the major

players on the budget framework. Austria will provide for a

flow of information among Member States, record areas of

agreement, facilitate dialogue and keep options open by

encouraging efforts at compromise. However, Schuessel will

probably not go out on a limb in hopes of brokering a deal.

He is unlikely to lead the way in offering concessions or

seek to link the finance issues to other questions. If

budget discussions reach an impasse and he judges that he

does not have the momentum to produce a full resolution,

Schuessel may try to fall back on an ad-hoc agreement that

will pass the problem on to the next presidency.


5. (C) TURKEY: Another issue that Schuessel will be content

to deflect is Turkey. Some observers have made much of

Austrian statements that the EU's accession negotiations with

Turkey should be "open-ended." At the same time, Schuessel

and his Foreign Minister have said unequivocally that

accession negotiations will begin on October 3, 2005. To

Schuessel, there is nothing mutually exclusive about these

statements. Turkey, he reasons, has the chance to qualify

for accession in exactly the same way that Austria did. He

would argue that to say that it may not be able to do so is

to state the obvious. Meanwhile, by an overwhelming margin,

Schuessel's constituents are vociferously opposed to Turkish

accession. In his view, it would be counterproductive (as

well as politically risky) not to acknowledge their concerns.

In fact, since the talks are scheduled to begin under the UK

Presidency, and observers expect them to go on for at least a

decade, Schuessel may well succeed in finessing the issue.

Unless something occurs to derail the October 3 start of

negotiations, Schuessel will be disinclined to risk any

domestic political capital on the EU-Turkey question.


6. (C) BALKANS: Austria has long defined the Balkans as its

area of top strategic concern. Austria has committed almost

a thousand troops to peacekeeping missions in the Balkans.

It has also invested diplomatic energy in cultivating

contacts across the spectrum in key areas such as Kosovo.

Schuessel would dearly love to have a positive impact during

the Austrian presidency. However, he remains cautious: while

he has floated the idea of hosting a follow-up to the

Thessaloniki conference during his presidency, he will avoid

excessive activity absent a reasonable chance of progress.

He will proceed if conditions seem right. He will look for

assurances of willingness on the part of the parties and

interested observers (i.e., the U.S. and Austria's EU

partners) to make and facilitate viable compromises. Austria

is also intent on fostering progress on fulfilling Croatia's

EU ambitions. Foreign Minister Ursula Plassnik -- a close

confidante and protege of Schuessel's -- has been outspoken

in calling for an early start to accession talks. More than

many countries, Austria is willing to accept at face value

Croatian protestations of good will on surrendering Gotovina.

Using the argument that EU membership will extend stability

to an unstable region, Austria will seek to build a consensus

for putting Croatia on the road to accession.


7. (C) CRIME AND CORRUPTION: Schuessel and his government

have worked for years to develop regional law enforcement

cooperation. In 2000, the Austrian Interior Ministry

initiated the Salzburg Forum, an informal gathering of

Central and Eastern European Interior Ministers to coordinate

border security, anti-corruption, and counter-terrorism

policies. This component of Austria's presidency strategy

will culminate in a meeting of Interior and Foreign Ministers

on May 4-5 in Vienna. Austria hopes that EU and partner

countries will adopt a "Vienna Declaration," including

measures to enhance border security and combat terrorism and

organized crime. The Austrians very much want the U.S.

Attorney General to attend.


8. (C) U.S.-EU SUMMIT: Schuessel has already put his top

advisors to work to confirm U.S. participation in the U.S.-EU

summit, which, according to pattern, should take place in

Austria. Our unwillingness to commit now to summit dates

confuses the Austrians. As a practical matter, they consider

it obvious that the staff of the world's most important and

busiest leader, who travels with a huge logistical footprint,

would want to make travel plans well in advance. Far from

thinking that they are badgering us, the Austrians think they

are being practical. Having already scheduled the EU's

summit with the Latin American and Caribbean countries in May

-- an event involving 60 delegations -- the Austrians

consider it reasonable to ask us to choose now whatever dates

we want.


9. (C) Ministerial Contacts: As a prelude to the Austrian

Presidency, Schuessel and several key ministers --Foreign,

Interior, Justice, Defense and Economic -- have expressed

intent to travel to Washington in Autumn 2005. The Austrians

see this as a natural step before they assume the presidency.

They expect the U.S. will want to make its views known to

the EU, and see it as the Presidency's role to perform this

function.

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Broader Foreign Policy: Neutrality and Business

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10. (C) After flirting with moving Austria toward NATO

membership during his first two years as Chancellor,

Schuessel recognized that the Austrian public was unready for

such a shift. He now stands by Austrian neutrality -- an

amorphous concept that means, essentially, that Austria will

not participate in or support military action without a UN or

EU mandate. Austria did not permit military overflights in

support of the Kosovo air campaign or Operation Iraqi

Freedom. The concept of neutrality has also meant that

Austria deals with all countries on the basis of Austrian

interests. Austria defined itself during the Cold War as a

bridge between competing blocs. Now, Austria pays homage to

the ideal of good relations with all countries. Austria will

always tend to seek increased dialogue, even if the prospects

for any practical outcome of that dialogue are poor.

Commercial interests can and do drive Austrian policy. In

countries of concern, where Austrian firms may be among only

a few Western companies, the Austrian policy of "constructive

dialogue" can reinforce a tendency to downplay political and

security concerns when faced with attractive business

opportunities.

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Domestic Interests: All Politics is Local

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11. (C) Schuessel is most comfortable with classical power

politics: the art of maneuvering to achieve a set of goals.

In contrast to his accommodating posture toward international

partners, Schuessel is not at all shy about head-on

confrontations with domestic opponents. His top priority is

his economic and social reform agenda. To the extent that

foreign policy threatens his domestic standing (e.g., with

popular expressions of displeasure at the prospect Turkish EU

membership),Schuessel will act to shore up domestic support.

This does not mean that he lacks political courage -- as in

his government's recent decision to deploy up to 100 troops

for Afghan election security. While this has not yet proven

controversial, it also did not score him any domestic points.

In general, Schuessel will want to see some concrete foreign

policy benefits to make up for domestic downside risk.


12. (C) CONCLUSION: Schuessel wants a successful EU

Presidency. He is politically savvy enough to want to avoid

obvious quagmires, but also to seize opportunities when they

arise. He and his government will try to define a set of

realistic, achievable objectives. They will not seek to

drive EU policy; neither will they want a role as advocates

within the EU for U.S. interests. If we want Schuessel to

understand and support our broad policy goals, we should

intensify our efforts to communicate them at a high level

well in advance of January 1. His requested visit to the

U.S. in November or December will provide the perfect

opportunity to do so.

van Voorst