MACEDONIA: SCENESETTER FOR STAFFDEL SLOAT

UNCLAS SECTION 01 OF 02 SKOPJE 000932 SIPDIS SENSITIVE SIPDIS STATE FOR EUR/SCE E.O. 12958: N/A TAGS: OREP PREL PGOV MK SUBJECT: MACEDONIA: SCENESETTER FOR STAFFDEL SLOAT AN OPPORTUNE VISIT ¶1. (SBU) Welcome to Skopje! You will arrive shortly after key USG, NATO, and EU officials have called on the political parties, the government, and members of parliament to put aside their partisan differences, engage in constructive dialogue, and rollup their sleeves. We have reiterated a consistent message: in order for Macedonia to have a chance of receiving a NATO invitation in April, the government and opposition need to work together, and the parliament needs to pass some key pieces of legislation during the next few weeks. You can help reinforce the message that voters, whether in Macedonia or the U.S., expect their representatives to put aside partisan differences when the national interest (in this case potential NATO membership) is at stake. FIRST SOME GOOD NEWS... ¶2. (SBU) We and the Europeans are pressing the Macedonian government (GOM) and opposition on critical NATO and EU membership-related issues. But first, the good news: -- The GOM submitted for parliamentary approval a decision calling for doubling Macedonia's contributions in Iraq -- by an additional platoon -- and MOD Elenovski says Macedonia also is considering a future increase in its troop contributions in Afghanistan. Macedonia also successfully hosted the NATO EAPC Security Summit in June, demonstrating it could tackle the logistics and security challenge of hosting 49 delegations for the event, including the NATO Secretary General. ` --Macedonia has made good anti-trafficking-in-persons (TIP) progress this year, moving from a Tier II Watchlist candidate to a solid Tier II performer. The government also has shown progress on the anti-corruption front, jumping from 105th place on Transparency International's corruption perception index in 2006 to 84th place this year. The government has actively pursued corruption investigations and prosecutions, although some cases clearly have been motivated by partisan considerations. --Implementation of the 2001 Framework Agreement (FWA),which ended a civil conflict between the government and ethnic Albanian insurgents, has progressed. Under the FWA, this year municipal governments continued to gain additional powers as part of the "decentralization" process of moving decisions closer to the citizens. The GOM also continued the hiring of ethnic Albanian and other minorities to implement equitable representation. But more remains to be done. The government needs to continue to work with the municipalities to iron out the remaining financial and procedural disputes. the government also needs to clear up the currently murky process for hiring ethnic minorities with transparent, fair, and non-partisan hiring guidelines. --Macedonia is showing positive economic performance, with the country recently ranked by the World Bank as one of the top 10 "most improved" countries in carrying out business environment reforms. Prime Minister Gruevski has raised public sector wages and cut VAT rates on some key consumer items, which has helped keep his poll numbers strong. Starting in 2008, personal and corporate profit tax rates will fall from 12 percent to 10 percent (flat tax),one of the lowest tax rates in Europe. --Rounding out its achievements, the GOM passed this year a liberal religious freedom law which generally meets ODIHR standards for protecting religious freedom. Implementation, slated to begin in mid-2008, will be the key test. NEED TO SPRINT, NOT LIMP, TO THE NATO FINISH LINE ¶3. (SBU) Despite positive accomplishments, movement on key political criteria has practically ground to a halt. The current relationship between the government coalition and opposition parties is bitter and accusatory. In September, physical scuffles broke out in parliament, a first for Macedonia. Earlier in the year the largest ethnic Albanian opposition party, DUI, had boycotted parliament due to its disputes with the GOM. In May, PM Gruevski's party, VMRO-DPMNE, reached an agreement with DUI leaders on a few of the most contentious inter-ethnic issues, and DUI returned to parliament. Unfortunately, implementation of this "May 29 agreement" has faltered, as the parties have not shown willingness to compromise. ¶4. (SBU) Parliament needs to show it can work constructively over the next few weeks, despite the intense political differences. It needs to implement internal parliamentary reforms, such as reconstituting the inter-ethnic relations committee (part of the May 29 agreement),as well as pass key legislation, such as a new law on the public prosecutor. SKOPJE 00000932 002 OF 002 ¶5. (SBU) Progress in judicial system reform, another key NATO criterion, has also been slow. The government has made some advances, such as filling 14 of the 15 seats of the State Judicial Council, which oversees the judiciary. Unfortunately, these achievements were often made by using short-term tactical maneuvers that avoided engaging with DUI and other opposition parties. COURSE CORRECTION ALSO NEEDED ON THE NAME ISSUE ¶6. (SBU) The GOM has, by and large, tried to act with restraint on the name issue, despite Greek threats to veto Macedonia's NATO candidacy if Skopje does not agree to a compromise solution before the NATO Summit in April. However, there have been GOM missteps along the way, such as renaming the Skopje airport after Alexander the Great. During negotiations on the name in New York November 1, UN Special Envoy Nimetz proposed guidelines and principles for moving toward a solution. Even though we are not asking Macedonia to change its constitutional name (Republic of Macedonia),we are urging both sides to refrain from provocations and to "study the Nimetz paper with an open mind and with a view toward finally resolving differences and reaching a solution to the issue." POLICE ACTION TARGETS CRIMINAL GROUP IN NORTHWEST ¶7. (SBU) On November 7, the Ministry of Interior (MOI)carried out a major police operation around Brodec, near the Kosovo border, aimed at a group of 30-40 criminals, including several escapees from a Kosovo prison. The group was suspected of, inter alia, arms smuggling and planning attacks on local police stations. The MOI reported that six members of the group were killed in exchanges of gunfire with police, but there were no civilian casualties officially reported. Police also discovered a large cache of ammunition, explosives, and weapons at the site of the incident. The success of the operation, however, was undermined by the MOI's slow follow-up in responding to allegations that those arrested had been mistreated in police custody, and by a court's denial of access by the Red Cross. TIME TO SEE CONCRETE ACHIEVEMENTS ¶8. (SBU) When you meet with members of parliament, NGO leaders, and Ministry of Foreign Affairs officials they will be well aware that the U.S. and our NATO partners are looking for an end to partisan bickering and finger pointing. However, it would be worth reiterating that 90 percent of Macedonians support NATO membership, so it is in the politicians' own domestic political self-interest to compromise and produce results. MILOVANOVIC