(C) CROATIAN PRESIDENT DISCUSSES ARTICLE 98, NATO

S E C R E T ZAGREB 000809 SIPDIS NOFORN SIPDIS FOR EUR/SCE E.O. 12958: DECL: 07/03/2016 TAGS: PREL PGOV NATO MARR HR SUBJECT: (C) CROATIAN PRESIDENT DISCUSSES ARTICLE 98, NATO WITH DEPARTING AMBASSADOR Classified By: CDA Greg Delawie for reasons 1.4(b) and (d). ¶1. (C) Summary: The President's office and the Croatian Government are working on a "counterproposal" regarding the US desire to conclude a Bilateral Security Cooperation (Article 98) Agreement with the US, President Stjepan Mesic told Ambassador Frank during a June 29 farewell call. The two also discussed Croatia's NATO aspirations and other issues. End summary. ¶2. (C) Croatia has seen significant progress in many important areas over the last several years, the Ambassador told President Stjepan Mesic. In particular, defense reform is clearly on track; refugee issues are being addressed; judicial reform is underway; and relations with Serbia are much improved and seem to be on a steady uphill track. US-Croatian relations are stronger than ever, as evidenced by the May visit to Dubrovnik by VP Dick Cheney, the visit of the USS Enterprise to Split; and the proposed merger between US-owned Barr Laboratories and Croatian-owned pharmaceutical company Pliva. ¶3. (S/NF) The Ambassador also praised Mesic for vastly improved bilateral intelligence cooperation. ¶4. (C) Regarding the Barr bid for Pliva, Mesic said that he had discussed the issue with Pliva's CEO Zeljko Covic the day before. Mesic strongly supported the Barr/Pliva merger, which was clearly a benefit to both companies. ¶5. (C) Regarding Croatia's aspirations to join NATO, the Ambassador noted that public support for the Alliance was going to continue to be a significant issue. Croatia needs to want to join NATO for the allies to give it the nod. Public support would not grow, he continued, without increased active support for the issue by the President himself. Croatians trust their president, the Ambassador said, and care what he says. ¶6. (C) Mesic agreed that it was important to expand engagement of GOC institutions in the public diplomacy campaign for NATO, so that the public gets to know better what will be gained by membership in the Alliance. There is an additional problem now regarding Croatia's domestic political alignment, he continued; in the past, the Croatian extreme right was pro-Western; but that has changed, decreasing support for NATO membership. ¶7. (C) The Ambassador encouraged Mesic to consider Croatia's participation in the NATO Training Mission in Iraq. Mesic said he would look for some way to make a contribution. ¶8. (C) The Ambassador pressed for a substantive response to the US proposal to conclude a Bilateral Security Cooperation Agreement that would incorporate Article 98 language. Mesic replied that he had sent a "compromise proposal" on this issue to the Croatian Government that we would see soon. ¶9. (C) On June 30 Presidential Foreign Policy Advisor Tomislav Jakic wrote the following note to Ambassador Frank: "Following your meeting with President Mesic and your short conversation concerning the Article 98, I am authorized by the President to inform you about the following: after receiving the U.S. draft proposal of a Security Cooperation Agreement between the Government of the Republic of Croatia and the USA, President Mesic asked a group of his advisers and legal experts to study this draft proposal. They produced a counterproposal, which, apart from several minor corrections and amendments introduces a new, but basically not radically different approach to Article 98. This counterproposal, was forwarded to the Croatian Government with the suggestion that it should be sent to the U.S. side. The Office of the President would be happy to discuss the matter extensively with Ambassador Bradtke immediately upon his arrival in Zagreb.8 ¶10. (C) We will follow up with the GOC on this issue. DELAWIE