CZECHS IN ASIA: CONTINUED FOCUS ON CHINA, BUT

C O N F I D E N T I A L SECTION 01 OF 03 PRAGUE 000046

SIPDIS

SIPDIS

E.O. 12958: DECL: 01/08/2015
TAGS: PREL EINV EZ CH BM IN PK AF VM CB
SUBJECT: CZECHS IN ASIA: CONTINUED FOCUS ON CHINA, BUT
INCREASING ENGAGEMENT PLANNED IN INDIA, VIETNAM

REF: A. 05 PRAGUE 1023


B. 05 PRAGUE 1664

Classified By: Pol/Econ Chief Michael Dodman for reasons 1.4 b+d.


1. (C) Summary. The Czech Republic plans active engagement
with East and South Asia in the first half of 2006, with most
attention focused on China. During a visit to Prague in
December, the Chinese PM closed an investment agreement that,
according to critics, noticeably favors Chinese interests
over Czech (and may violate EU rules). Several visits to
China are being planned for the coming months, with the focus
squarely on commercial issues; the Speaker of Parliament has
floated the idea of a visit to Tibet as a means of drawing
attention to human rights, but the proposal is likely to
fail. PM Paroubek will visit India this month, on the heels
of a visit by President Klaus; among the business deals the
GOCR hopes to discuss is possible Indian purchase of a VERA
radar system, which would be a counterweight to the system
Pakistan is planning to acquire. Several leading Czech
officials plan to visit Vietnam this year, and a visit to
Prague by the Vietnamese PM is possible in the spring.
President Karzai intends to visit Prague this year, as the
Czechs contemplate increasing their engagement in
Afghanistan. The Czech MFA continues to work with the North
Koreans to define their relationship, and the Czechs will be
pursuing the question of conditions for North Korean workers
in the CR. Despite this flurry of activity, the Czech MFA
admits it does not have a coherent Asia strategy, and hopes
to coordinate this with the USG. End summary.


2. (C) Pol/Econ Counselor (serving as Charge) and Poloff met
Jan 5 with Jan Fury, Czech MFA Director of Asia/Pacific
Department, to review the December visit to Prague of Chinese
PM Wen Jiabao, as well as on-going Czech discussions with
North Korea. Fury provided an extensive overview of planned
Czech engagement with countries in South and East Asia in
2006, indicating that the planned June Czech elections will
not slow the pace of official travel involving PM Paroubek
and senior Czech officials.

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China
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3. (C) The Chinese PM visited Prague Dec 8-9, 2005. The
visit was designed to build on PM Paroubek's June 2005 trip
to China, which launched a sharp escalation in Czech-Chinese
engagement (reftels). As expected, the Prague talks focused
nearly exclusively on economic cooperation. Aside from the
announcement of some small business deals, the big news from
the visit -- the first by a Chinese PM to Prague since the
Velvet Revolution -- was signature of a controversial
investment agreement which, according to critics (including
the Foreign Minister),is both overly preferential to the
Chinese side and contravenes EU rules. According to Fury,
Paroubek did not raise the human rights situation or IPR
deficiencies in China, and neither side raised the EU arms
embargo.


4. (C) Fury outlined a number of visits planned in the coming
months. Speaker of Parliament Lubomir Zaoralek (CSSD)
intends to visit China, as well as Hong Kong and Vietnam, in
late January. Zaoralek's agenda was not yet settled. Press
reports indicated Zaoralek was considering trying to include
a stop in Tibet on his itinerary, as a way of highlighting
the human rights situation, but Fury expected this would not
win approval from Beijing, and Zaoralek subsequently stated
this is unlikely. (Comment: Zaoralek, however, can be
expected to keep human rights on his agenda in Beijing,
although Paroubek is likely to urge him to treat the issue
lightly.) Deputy FM Basta has been invited to Beijing, and
FM Svoboda is also contemplating a trip before the June Czech
elections (possibly to include stops in Japan, Mongolia and
Kazakhstan). Fury complained that the pace of visits was out
of proportion to the actual amount of
government-to-government work to be accomplished.

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India & Pakistan
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5. (C) The Czechs seek increased economic cooperation with
India as well. PM Paroubek plans to travel to New Delhi and
Calcutta the week of January 17, 2006. Paroubek will meet
with Indian President and prominent Indian business leaders,
and deliver a speech at a business conference. His visit
follows a December trip to India by Czech President Klaus.
According to Fury, Paroubek will not pursue any significant
political topics during his visit, but (as in China) will
focus almost exclusively on business. One topic likely to be
raised is Indian interest in purchasing a version of the
Czech-made VERA passive surveillance system. Fury said the
Indian interest in the purchase is a result of Pakistan's
intention to also acquire the technology (note: Czech
officials had approached us in 2004 regarding a possible
VERA-E sale to India; the USG did not indicate objections to
the sale, but there appear to have been no active discussions
on an actual deal since then).


6. (SBU) Fury noted that Deputy FM Tomas Pojar will also
travel to India and Pakistan in coming months. Further on
Pakistan, the Czechs plan to airlift 11 Pakistani children to
Prague in January to provide medical treatment, mostly for
traumatic injuries, that cannot be provided in Pakistan.

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Cambodia, Burma & Vietnam
--------------


6. (C) Although the Czechs do not have a mission in Cambodia,
the MFA plan to host a Chiefs of Mission Conference in
Cambodia March 11-15 to celebrate the 50th anniversary of
Czech-Cambodian diplomatic relations. Relations between the
Czechs and the Cambodians are very cordial thanks to King
Sihanouk, affectionately known in Prague as the &Czech
Prince8 because he is a fluent Czech speaker. Fury noted
that he was interested in opening an embassy in Phnom Penh,
but he doubted the MFA's budget would permit this. He added
that the MFA is also engaged in an internal debate on the
wisdom of opening an embassy in Rangoon, with the issue there
not so much money but the appropriate approach to take
vis-a-vis the regime: to increase engagement with an embassy
(which could facilitate Czech pro-democracy work),or
continue to isolate the regime.


7. (C) Czech visitors to Vietnam this year are likely to
include Speaker Zaoralek, Deputy FM Pojar, and Minister of
Trade and Industry Milan Urban. Fury said there is an
invitation outstanding for Vietnamese PM Phan Van Khai to
visit Prague before the June elections.

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Afghanistan
--------------


8. (C) Turning to Afghanistan, Fury said President Hamid
Karzai is expected to visit Prague this year. Fury had no
details on the visit, only that it was not likely to be tied
to the upcoming London conference on Afghanistan (note: the
Afghan Ambassador in Prague is closely related to President
Karzai, and this is a likely impetus for the possible visit).
Fury noted that discussion was on-going within the MFA about
how and when to reopen their embassy in Kabul, which was
important given the level of Czech engagement there. While
no decision has been taken on a permanent mission, the MFA
recently sent a dedicated Afghan-watcher to its mission in
Islamabad. Fury noted that in addition to the GOCR decision
to return Czech Special Forces to Iraq this year (approved
Jan 11 by the cabinet, but still subject to parliamentary
approval),the MFA and MOD are actively debating leading a
PRT in Afghanistan (details septel).

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North Korean Workers & Relations
--------------


9. (C) CDA informed Fury that the U.S. press has reported
that North Korean women are laboring in the Czech Republic
under poor working and living conditions. The women
allegedly pay more than half their wages to the North Korean
government, and then starve themselves so they will have

PRAGUE 00000046 003 OF 003


money for their families. CDA noted that the Embassy will be
investigating the story and meeting with other Czech
ministries, and urged the MFA to likewise investigate. Fury
said he found the story disgusting and personally agreed that
these sorts of labor contracts should not exist in the Czech
Republic. Fury also said he would discuss the issue with the
North Korean Ambassador during an upcoming meeting. At that
meeting, Fury promised that the MFA would be raising the need
for progress in the six-party talks, and investigating steps
that the two governments could take to improve cooperation in
previously agreed humanitarian areas -- for instance,
movement on a Czech proposal to bring a North Korean
children's choir to the CR. He added that Pyongyang was
interested in having him visit for further talks, but he saw
no need for a visit absent signs of progress on previous
proposals.

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Asia Strategy
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10. (C) Fury admitted that one surprise in his few months on
the job has been the lack of an agreed GOCR Asia "strategy."
He would like to coordinate with the USG on development of
such a document. We will follow-up with Fury on specific
ideas (and provide publicly available USG documents) during a
subsequent meeting.
CABANISS