OPENING DOORS AND OPENING EYES: PM GYURCSANY ON

S E C R E T SECTION 01 OF 02 BUDAPEST 000986

SIPDIS

SIPDIS

DEPARTMENT PLEASE PASS TO NSC FOR ADAM STERLING

E.O. 12958: DECL: 06/17/2017
TAGS: PREL PGOV PINR RU HU ENRG
SUBJECT: OPENING DOORS AND OPENING EYES: PM GYURCSANY ON
RELATIONS WITH THE U.S. AND RUSSIA

Classified By: P/E COUNSELOR ERIC V. GAUDIOSI; REASONS 1.4 (B) AND (D)


1. (S) Summary: PM Gyurcsany and his wife, Dr. Klara Dobrev,
joined Ambassador Foley for lunch June 17. Discussion
focused on Russia policy, with a tense, reticent and often
defensive Gyurcsany expressing his desire "not to get caught
in the middle" of the declining US-Russia relationship. He
urged broader US-Hungary consultations to avoid "further
misunderstandings," an invitation we gladly accepted in order
to prevent further drift in Hungary's foreign policy. End
Summary.

DOMESTIC POLITICS: NOTHING TO SEE HERE ...


2. (C) Arriving the day after announcing a reshuffle in his
cabinet, PM Gyurcsany was nonetheless disinclined to discuss
his personnel moves. He touched only briefly on domestic
politics, agreeing with his wife's observation that most
Hungarians seem to regard the present austerity measures as
temporary. (Note: This theory is supported by the reported
increase in temporary loans, suggesting that Hungarians have
a degree of confidence that the economy will rebound in the
forseeable future. End Note.) The economic impact of
reforms, he suggested, has been accentuated by the
unrealistically high expectations of the average Hungarian.

WHY ME?


3. (S) Turning to foreign policy, Gyurcsany admitted frankly
that the GoH had completely "missed" the downturn in
US-Russian relations. He believes that Hungary's contacts
with Russia have been viewed through the lens of our
declining bilateral relationship, and that Budapest is
accordingly seen as being closer to Moscow than it actually
is. He noted that his task is to avoid being "lumped in with
Russia" or "caught in the middle." Naming the other European
governments with bilateral energy deals with Russia,
Gyurcsany implied that Hungary had been singled out for
criticism because "no one can criticize Germany."

A TRIP TO RUSSIA ... BUT "NO RUSSIAN STRATEGY"


4. (S) Seeking to "avoid any misunderstanding," Gyurcsany
confirmed reports from the media and opposition politicians
that he is planning another trip to Russia this year. He
described the trip, organized around a visit to Finno-Ugric
speaking communities with Putin and the Finnish President
(but not an Estonan representative),as "completely without
any political agenda."


5. (S) Continuing on Russia, Gyurcsany predicted
matter-of-factly that "Putin will be back." He downplayed any
Russian "Hungary strategy," suggesting that Moscow views
Budapest only in the context of its relationship with the EU.
He believes Putin's top priority remains its immediate
neighbors, especially in Central Asia, and predicted that
Moscow will ultimately "go along" on Kosovo despite its
present rhetoric.

THE HIGH ROAD AND THE ROAD NOT TRAVELLED


6. (S) Commenting that "it takes two parties to have a bad
relationship" and comparing the situation to a marital
dispute, Gyurcsany urged us not to respond to Russian
rhetoric. He maintained that much of the present dynamic is
the unintended consequence of America's actions in Iraq,
urging us to recognize our relationship with Hungary as a
"two-way street" by "increasing our consultations" in order
to "help our alliance" deal with this issue. He seized on
the reported prospect of Deutsch Telecom's sale of the
Hungarian telecom company to a suspect Russian concern,
asking repeatedly why "your intelligence services didn't tell
me about it." He will go directly to Chancellor Merkel to
request her intervention to stop the sale, but pressed us for
broader and more frequent consultations with the US.

A NIGHT AT THE IMPROV


7. (S) Note: Departing lunch to give a speech, Gyurcsany
remarked that he continues to improvise his public addresses
around "key points and phrases." His remarks - and often his
policies - continue to have an improvisational quality about
them, but insiders note that he has been sticking to a
written script on energy issues on the advice of his advisors
in order to avoid compounding his previous statements.
Foreign Policy Institute Director Pal Dunai credits US
engagement with the PM's newfound circumspection, but warns
that "it's always hard to keep the PM on message." End Note.

A WORD TO THE WISE

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8. (S) Comment: Though very likely prepped by advisors to
make clear his commitment to the trans-Atlantic relationship,
the Prime Minister clearly regards questions re Hungary's
Russia policy in very personal terms. On this issue - and
others - he is still prone to lay blame anywhere but his own
door. That said, he has opened the door to broader
consultations and we should waste no time in walking through.
Though Gyurcsany's assertion that Hungary "missed" the
impact of Russian behavior on our bilateral relationship is
more convenient than credible even with the well-known
problems in the Prime Minister's Office. Hungarian officials
do feel far removed from our deliberations. To prevent the
still delicate issue of energy security from becoming the
rule and not the exception in our relationship, we urge
high-level officials travelling to Europe to add Hungary to
their itineraries in order to keep the GoH informed ... and
on board. End Comment.

FOLEY