(C) LITHUANIAN-RUSSIAN RELATIONS BOUNCE BACK, BUT

C O N F I D E N T I A L SECTION 01 OF 03 VILNIUS 000655

SIPDIS

STATE FOR EUR/NB

E.O. 12958: DECL: 06/20/2014
TAGS: PREL PGOV EPET ELTN RS LH
SUBJECT: (C) LITHUANIAN-RUSSIAN RELATIONS BOUNCE BACK, BUT
POTENTIAL FOR TENSION REMAINS

REF: A. VILNIUS 174

B. VILNIUS 219

C. VILNIUS 231

D. VILNIUS 326

E. 04 VILNIUS 382

Classified By: POL/ECON OFFICER GREGORY L. BERNSTEEN FOR REASONS 1.4(B)
AND (D).

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Summary
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1. (C) Lithuania's complicated relations with Russia -- after
five months of emotional tensions -- are improving again.
The May visit of Russian FM Lavrov -- featuring his second
meeting with Lithuanian Foreign Minister Valionis in a month
-- produced a lengthy declaration promising enhanced
cooperation on border, consular, and customs issues and
better neighborly relations, a long-delayed agreement on
ports and transit issues, and a Lithuanian agreement to not
press compensation claims on Russia. The ministers also
agreed to launch negotiations on energy agreements to assure
unfettered transit through Russia and Lithuania for oil, gas,
and electricity. Potential irritants continue to loom,
however: Valionis on June 15 threatened to crack down on what
he called a Russian-sponsored anti-Lithuania propaganda
campaign, even as parliamentary opposition continued to press
loudly for compensation for the Soviet occupation. END
SUMMARY.

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New Year, New Disputes
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2. (U) Lithuanian-Russian relations took a turn for the worse
in the first five months of 2005. Perceived Russian pressure
to participate in World War II commemorative ceremonies in
Moscow on May 9, new attention to former KGB recruits in the
current Lithuanian leadership, and crude insults and threats
from Russia's resident Ambassador all contributed to a newly
ugly atmosphere in the relationship as the year wore on. And
the pressures kept coming: Lithuania's parliamentary chief
publicly threatened new expulsions of diplomats for alleged
espionage in the Lithuanian parliament; the government closed
a Russian language post-secondary academy for non-compliance
with local regulations; and local press charged the
government's Economic Minister -- ethnic Russian Victor
Uspaskich -- with gross conflicts of interest in pursuing
Russian commercial contracts for his former businesses.

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Lavrov's Mission to Vilnius
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3. (U) These heated incidents prompted Lithuanian Foreign
Minister Valionis to visit Moscow April 8 to calm the waters,
and that visit resulted in an agreement for Russian Foreign
Minister Lavrov to return to Lithuania for a special session
of the Lithuanian-Russian inter-governmental commission in
May. Lavrov and Russian Transportation Minister Igor Levitin
traveled to Vilnius May 26 for the meeting, which made
progress in focusing the bilateral relationship on more
constructive issues. Arunas Vinciunas, Head of the MFA's
Russia Division, told us the meeting produced final agreement
on the so-called "2K" plan to equalize access to and
infrastructure at the ports of Klaipeda and Kaliningrad.
Previously, Russia had charged higher tariffs on goods headed
to Klaipeda for export than those headed to Kaliningrad.

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Statement of Political Good Will
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4. (U) The Foreign Ministers issued a joint statement at the
conclusion of Lavrov's visit, pledging to enhance bilateral
cooperation and to develop neighborly relations. Vinciunas
characterized the statement as "three pages of positive
political intentions" that will encourage cooperation between
working-level officials in both countries. The statement
laid out the governments' satisfaction with the passenger
transit mechanism (a target for frequent Russian griping
since its implementation two years previously) and their
agreement to address related consular issues. It also sets
forth their interest in improving cooperation on
phytosanitary issues concerning veterinary cargo, insurance
requirements, and border-crossing procedures, among other
matters. Vinciunas said that ministers did not discuss
military issues.

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Russia's Perspective
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5. (C) Russia's DCM in Vilnuis, Dmitry Tsvetkov, told us that
current relations between Russia and Lithuania are basically
good, and had not particularly suffered as a result of
President Adamkus's decision not to attend Moscow's May 9
commemoration. Noting that regular Lithuanian demands that
Russia make amends for the Soviet occupation of Lithuania
were unhelpful, Tsvetkov welcomed what he said was Valionis's
commitment to Lavrov that the GOL would refrain from publicly
pressing the point. Political Counselor Valery Pospelov
contemptuously dismissed the Baltic nations' concerns
entirely: "It's ridiculous propaganda," he said. "We were
one country." On the related matter of Lithuanian claims to
compensation for damages stemming from the Soviet era,
Tsvetkov was again dismissive. Lithuanians were free to

SIPDIS
claim compensation, he said, only if they had been residents
of Russia (other than as political prisoners or deportees)
during Soviet times.

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Road Ahead: Negotiations on Travel Documents, Energy
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6. (C) Despite the statement's satisfaction with the
implementation of procedures governing Russian transit
through Lithuania to and from Kaliningrad, Russian diplomats
here signaled an intention to pursue changes to the system.
In the current system, Russians who want to transit Lithuania
between the two territories must procure a "facilitated
travel document" (FTD),issued after Lithuanian security
checks, from the point of embarkation. Pospelov maintained
that Lithuania's accession to the Schengen zone would require
a new system featuring Schengen visas for transiting
Russians. (Note: Lithuanian foreign ministry officials said
that, although they had not reached a final conclusion, they
did not foresee any problems with continuing the use of the
current FTD system after Schengen accession. End note.)


7. (C) Pospelov also said that Lavrov discussed energy with
his Lithuanian interlocutors and noted that Russia and the
GOL will begin to negotiate new bilateral agreements
regarding cooperation on gas, oil, and electricity.
Vinciunas, head of MFA's Russia Desk, said that the
agreements would guarantee free transit of energy through
Russia and Lithuania. Currently, Lithuania's ability to use
Russian pipelines to import oil and gas is subject to the
whims of state-owned Russian companies. Lithuania supports
the idea, since it would remove one of Russia's economic
weapons, allowing Lithuania to purchase oil and gas from
producers in Central Asia and the Caucausus and ship them
through pipelines located in Russia or owned by Russian
companies. For Russia, the agreements' main benefit would be
freer access to supply energy to Kaliningrad. Vinciunas was
pessimistic that the negotiations would be successful,
because he believes that Russia is reluctant to relinquish
oil as a source of leverage over Lithuania.

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Irritants Remain
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8. (C) Lavrov's visit for now changed the tone of
Lithuanian-Russian relations for the better, but emotional
irritants continue to crop up outside, and even sometimes
within, inter-governmental channels. On June 14, the
anniversary of the launch of Soviet deportations of
Lithuanians in 1941, the parliamentary opposition introduced
a resolution criticizing Russia's refusal to recognize the
occupation of the Baltics and demanding approximately 80
billion Litas (over USD 20 billion) for reparations from
Russia for occupation damages. Conservative MP Rasa
Jukneviciene called Putin's May 9 celebrations a
"Machiavellian show," and claimed that the Russians are still
spreading propaganda about the Baltics. PM Brazauskas, on
behalf of the center-left coalition that he heads, responded
that Lithuania would achieve more through negotiations than
through unilateral resolutions. Meanwhile, on June 15,
Foreign Minister Valionis bitterly criticized broadcasting
from a Russian-financed television station in Lithuania for
what he called provocative anti-Lithuanian propaganda, and
threatened action to silence the station.

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Comment
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9. (C) The GOL may have promised to play nice with Russia,
but politicians, having made no such promise, will likely
continue to spotlight past Soviet abuses and to question
Russian intentions -- as much for EU and foreign observers as
Lithuanian. It is unlikely, however, that either Lithuania
or Russia will let the rhetoric get in the way of business.
The neighbors' critical, intertwined economic and political
interests, including Lithuania's oil supply and Russia's
access to Kaliningrad, compel them to work together, despite
their mutual aversion.

Mull