EU ENLARGEMENT OFFICIAL ON W. BALKANS

C O N F I D E N T I A L SECTION 01 OF 02 BRUSSELS 000775

SIPDIS

E.O. 12958: DECL: 03/07/2016
TAGS: PREL EAID ZL EUN USEU BRUSSELS
SUBJECT: EU ENLARGEMENT OFFICIAL ON W. BALKANS

REF: A. (A) CARVER-DICARLO EMAIL 1/29/06

B. - (B) BRUSSELS 650

Classified By: Political Officer Vincent Carver for reason 1.5 (b/d).

SUMMARY
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1. (C) Heather Grabbe, Advisor to Enlargement Commissioner
Rehn, and visiting EUR/SCE Director Charles English reviewed
the Western Balkans March 1 (English's meeting with EU COWEB
Troika reported septel). Grabbe said EU FMs, at their
informal "Gymnich" meeting in Salzburg March 10-11, would
review visa facilitation, extension of preferential trade
conditions, and increased scholarships as inducements for
citizens in the Balkans to support EU accession and related
reforms. English urged the EU to consider ways to provide
Serbia extra inducements and frontload pre-accession
assistance. Grabbe noted that Stabilization and Association
Agreement (SAA) negotiations with Serbia, scheduled April 5,
would be suspended indefinitely absent full cooperation from
Belgrade with the ICTY. Full cooperation, she specified, did
not mean Mladic's arrest but did mean cooperation that would
help lead to Mladic's arrest and transfer to The Hague, as in
the Gotovina case. Grabbe opined that Slovenia and Hungary
might recognize Montenegro if the vote favoring independence
falls in the "grey zone" of between 50 and 55 percent. She
said SAA negotiations with BiH were progressing slowly and
that the EU had emphasized the need for cooperation with ICTY
from all BiH elements. Grabbe urged the U.S. to support a
regional free trade agreement in the Balkans. END SUMMARY

GYMNICH: PRACTICAL INDUCEMENTS FOR REGION
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2. (C) Grabbe outlined possible EU inducements for the W.
Balkans that will be reviewed at the informal EU FMs' meeting
("Gymnich") in Salzburg March 10-11 (ref A). EU FMs will
also meet with their Balkan counterparts at the Gymnich.
Grabbe said all member states except France are now
supportive of a slightly eased visa regime for the region's
citizens, that would include visa facilitation for scholars
and some students. (Note: France is also calling for an
increase in Schengen visa fees from 35 euros to 60 euros).
The aim of visa facilitation as well as a plan for increased
scholarships for students from the region, Grabbe noted, is
to make the European perspective a more tangible benefit and
inducement for the citizens of the region to support
continued reforms.


3. (C) English asked if the EU planned to provide Serbia
extra inducements in light of the Kosovo final status talks.
Grabbe said the EU wants to remain consistent and not offer
Belgrade "special favors," but rather offer region-wide
inducements. That said, given the political circumstances,
she acknowledged that the EU might be able to make Serbia a
priority. Grabbe added that the EU continues to support
combining the 31 bilateral free trade agreements (FTA) in the
region into one FTA for the Balkans. This would not only
increase trade but also attract foreign investment given a
combined market of approximately 20 million consumers. The
EU is also considering extending a diagonal cumulation of
rules of origin benefits to the Balkans, thereby extending EU
preferential trade treatment to more products partially
produced in the Balkans. Grabbe urged the U.S. to drop its
reservations on a regional FTA. English agreed to raise the
issue upon return to Washington.

SaM: EU WANTS FULL COOPERATION WITH ICTY
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4. (C) Grabbe noted that the EU, in considering suspension
of SAA negotiations with Belgrade, will rely heavily on ICTY
Chief Prosecutor del Ponte's judgment and use other sources
as well regarding whether SaM is cooperating fully with the
ICTY on Mladic. Overall, SaM cooperation with ICTY has
deteriorated since 2005 and Rehn has been clear that the EU
wants full cooperation or the April 5 round of SAA
negotiations will be suspended and will not be resumed until
full cooperation is established. Grabbe added that, in the
Commission's view, "full cooperation" does not mean the
arrest and transfer of Mladic to The Hague, but it does mean
providing the intelligence and documentation that would lead
to such actions. According to Grabbe, Serbian PM Kostunica
indicated to Barroso and Rehn, during their February visit to
Belgrade, that he still hoped Mladic would voluntarily
surrender. Grabbe said she viewed this a voluntary surrender
an unlikely possibility.


5. (C) Grabbe said that Serbian FM Draskovic, in his meeting
with the EU Troika following the GAERC (ref B) February 27,
called for NATO to allow SaM to join PfP. This, he stressed,
would be a large incentive for the Serbian Army to cooperate
on arresting Mladic. English noted that Mladic's transfer to
The Hague has been a key condition for NATO's moving forward
on PfP for SaM. Grabbe and English agreed on coordinating
messages and positions on assistance to Belgrade and ICTY
cooperation.

Strategic Partnership with SaM
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6. (C) English outlined possible elements of a Western
Strategic Partnership with Serbia, including debt relief.
Grabbe noted that EU aid to Serbia is already high and near
the level accorded candidate countries. The EU, she added,
might be able to increase financial assistance after final
status is determined for Kosovo as a way to encourage
Belgrade's European perspective. English encouraged the EU
to explore ways to frontload its assistance programs. Grabbe
agreed that the EU could explore providing additional
capacity-building programs to help Serbia meet its SAA
requirements.

Montenegrin Referendum
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7. (C) Grabbe observed that if Montenegro becomes
independent, the EU will have to draft a new SAA negotiating
mandate for Montenegro and adapt its mandate for Serbia.
Both moves would require unanimous approval by member states,
but Grabbe said there was not a high likelihood that any
member state would oppose such actions. Asked what the EU
would do if Montenegrins voted in the "grey zone" of between
50 and 55 percent for independence, Grabbe noted that
Slovenia and possibly Hungary would possibly recognize
Montenegrin independence.

BiH: SLOW PACE OF SAA NEGOTIATIONS
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8. (C) EU SAA negotiations with Sarajevo are progressing
slowly, Grabbe said. Barroso clearly underscored to BiH
authorities that all of BiH, not just the Republika Srpska,
needs to cooperate with ICTY. According to Grabbe, BiH is
not providing ICTY with needed evidence and documents.


9. (U) EUR/SCE Director English has cleared this message.
GRAY
.