AUSTRIAN MEDIA HIGHLIGHTS: October 18, 2006

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SUBJECT: AUSTRIAN MEDIA HIGHLIGHTS: October 18, 2006

Coalition Talks Continue


1. The OeVP and the SPOe met on Tuesday for their second round of
talks on forming a new coalition government. Although the two
parties' negotiation teams addressed key topics at yesterday's
meeting, they continue to be divided on a number of issues. While
some Austrian media believe the talks are an indication a grand
coalition may soon be a done deal, other newspapers report of a
"poisoned climate" at the talks.
Like all Austrian media, semi-official daily Wiener Zeitung says the
two parties at their meeting on Tuesday agreed on a joint checking
of the finances by October 27, when the next round of talks will be
held. The SPOe and the OeVP have also said they want to discuss the
key issues on the agenda, and have set up ten negotiation
sub-groups, which are to start working this week. Mass-circulation
tabloid Kronen Zeitung writes political observers in Austria are

confident that it will be clear by mid-November whether the Social
Democrats and the Conservatives will, indeed, form a grand
coalition. In contrast, independent provincial daily Salzburger
Nachrichten believes the "poisoned atmosphere" between the SPOe and
the OeVP, marked by competition and squabbles over positions to be
distributed, will likely paralyze the coalition talks.


Pressure on OeVP


2. Speaking to an Austrian daily, Vienna Mayor Michael Haeupl is
urging the OeVP to start working seriously on forming a grand
coalition, which he believes is the "only real option." Otherwise,
Haeupl said, the "only logical consequence is a rerun of the general
elections."
Vienna Mayor Michael Haeupl (SPOe) is demanding "constructive work"
from the Conservatives, mass-circulation daily Kurier writes.
Austria's two leading parties, the SPOe and the OeVP, "will have to
find a way to cooperate. If the people in the OeVP do not want to do
so, they should just leave it, and then we'll have a rerun of the
general elections," Haeupl told the Kurier. The Vienna Mayor also
criticized the Conservatives for their recent attack on President
Heinz Fischer: Leading OeVP members had complained that Fischer had
not given a statement on the controversial Eurofighter purchase
contract, despite the fact that he had read it, and had labeled the
President a "dyed-in-the wool Social Democrat who can't wait to
install an SPOe chancellor."


The Eurofighter Controversy Continues


3. The former chief strategist of the Austrian armed forces, Gerald
Karner, told an Austrian weekly that a cancellation of the
Eurofighter purchase deal would cost the country four billion Euros
until 2012.
Pointing out the high costs of a contract cancellation, the Austrian
military expert cautioned against abandoning the Eurofighter
purchase deal, semi-official daily Wiener Zeitung writes. Gerald
Karner believes that Austria would "lose its reputation and its
money," should the government back out of the deal. Such a move, he
argues, cannot be in the political interest of the SPOe. The Greens,
however, remain opposed to the Eurofighter jets, and will table
motions for the cancellation both of the purchase deal and the
financial authorization for the purchase of the interceptors from
the 2003 budget legislation.


EU-US Plan to Save the Ozone Layer


4. California Governor Arnold Schwarzenegger is calling for a
trans-Atlantic initiative to combat global warming by limiting
industrial emissions. The plan would involve California, the member
states of the European Union, as well as seven other US states.
According to semi-official daily Wiener Zeitung, the plan calls for
setting up a system whereby the parties involved could trade, buy or
sell industrial emission credits as regulated under the terms of the
Kyoto Protocol. Reducing admissions was a key part of the agreement,
but the Bush administration withdrew from efforts to implement Kyoto
in 2001, a move that strained US-EU ties. The environment and rising
fuel prices are some of the issues dominating the Austrian-born
California governor's bid to be re-elected next month, when a
referendum on a proposed new gasoline tax will also be on the
ballot. Schwarzenegger opposes such a tax, which has the public
support of former president Bill Clinton and former Vice-President
Al Gore, the daily says.
North Korea Warned against 2nd Test


5. The regime in Pyongyang is apparently preparing yet another
nuclear test. Both North Korea and the US are meanwhile accusing
each other of carrying out "belligerent acts" in the conflict over
North Korea's nuclear program.
Meanwhile ORF radio early morning news Morgenjournal says that US
Secretary of State Condoleezza Rice is on her way to East Asia to

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discuss how to fully impose UN sanctions on North Korea. However,
according to commentator for mass circulation tabloid Oesterreich
Patrik Volf, "US nuclear policy has reached its end." He says it
"took barely a week for both sides to reach the stage of using the
word 'war' in their statements. North Korea views the UN Security
Council's decision (to which its key ally China agreed) a
'declaration of war,' while the US regards a possible second nuclear
test as 'an act of war.' Iran, the next rising nuclear power will
have to carefully watch this game, because the US statements are by
no means directed against North Korea exclusively. They mark any
further development in the nuclear conflict at the Persian Gulf
where limits are to be drawn. This means for North Korea: The US
cannot move towards the negotiation table, because that would be a
clear signal to Iran: You are only a partner if you have nuclear
weapons."


Iran Sanctions Possible


6. In the dispute over Tehran's nuclear ambitions, the EU no longer
expects a diplomatic solution. UN measures against Iran are
"unavoidable," according to German Foreign Minister Frank-Walter
Steinmeier.
Centrist daily Die Presse reports that at their meeting in
Luxembourg yesterday, the EU foreign ministers are pushing for
"sanctions being imposed gradually." Spain's Under Secretary for the
EU Alberto Navarro pointed out that unlike the US, Europe is
dependent on Iranian oil. Nonetheless, the UN Security Coucil could
make a preliminary decision on sanctions, aimed primarily at the
country's nuclear industry, as early as next week, the daily says.
Measures could include trade restrictions on technical supplies, as
well as a freeze on contacts with Iranian scientists and on
investments in Iran's nuclear industry.


Stay the Course - or Do an About-Face?


7. Middle East expert and former Austrian envoy to Iraq Gudrun
Harrer says in an analysis of the situation in Iraq that the current
escalation of violence in the country is reinforcing doubts whether
the Iraqi government will ever be in control.
Gudrun Harrer, foreign editor for liberal daily Der Standard and
Austria's former special envoy to Iraq, writes that although no-one
seems to have a solution for the ongoing problems in Iraq, George
Bush's mantra of "staying the course" is beginning to sound a lot
like wishful thinking, and the question of its implementation will
likely not be decided in Washington or Baghdad's Green Zone, but in
the Iraqi capital's streets. It is high-season for forecasts on the
development of Iraq, as well as for American exit strategies, which
are increasingly put forward not only by the opponents of the war
and by the more creative journalists, but also by at least partly
official sources, Harrer says. Now, statements, as for example by US
Ambassador to Iraq Zalmay Khalilzad, stating that Iraqi Premier Nuri
Al-Maliki has two months time to get things under control, seem to
suggest the US might take steps otherwise.

For full text in German go to: http://derstandard.at/ --> Politik
--> International --> Nahost --> Irak --> "Kurs halten oder das
Steuer herumreissen"
McCaw