COASI: US-EU DISCUSSION ON EAST ASIA, OCTOBER 22,

S E C R E T SECTION 01 OF 06 STATE 156455 SIPDIS SIPDIS E.O. 12958: DECL: 11/14/2022 TAGS: PREL XB SUBJECT: COASI: US-EU DISCUSSION ON EAST ASIA, OCTOBER 22, 2007 Classified By: Glyn T. Davies SUMMARY -------------- ¶1. (S) European Union senior officials met with EAP counterparts for biannual consultations on Asia on October 22, 2007, in Washington. A/S Hill opened with an overview of the Six-Party Talks process, highlighting the roles of China, Japan, and the Republic of Korea. Both sides shared views on the current situations in Burma and Thailand, with the Europeans giving a preview of their upcoming November 23 summit with ASEAN. The EU will also have a November 28 summit with China at which they hope to discuss human rights, anti-corruption, good governance, environmental protection and China,s rapid military build-up; but sense the PRC is most interested in EU affirmation of a &one-China Policy.8 Discussions on relations with the Philippines and Indonesia and both nations, important position in combating terrorism rounded out the discussion on East Asia. SCA Acting A/S James F. Moriarty joined for a broad discussion on Asian regional cooperation and integration, including the ASEAN Regional Forum (ARF),the East Asia Summit (EAS),and the Shanghai Cooperation Organization (SCO). DPRK AND SIX-PARTY TALKS -------------- ¶2. (S) A/S Christopher R. Hill provided an overview of recent progress in the Six-Party Talks. The DPRK has committed to substantial disablement of the Yongbyon nuclear facility and to providing a complete declaration of its nuclear programs, including clarification of the uranium enrichment issue by the end of the year, Hill explained. In exchange, the Six Parties are providing the DPRK with energy assistance in the form of heavy fuel oil. The United States has also made several bilateral commitments, Hill detailed, including with regard to the DPRK's designation as a State Sponsor of Terrorism and the application of the Trading with the Enemy Act with respect to the DPRK. The terrorism list presents a sensitive issue for Japan, and the U.S. therefore will handle this issue very carefully. The United States has also pressed the DPRK to make progress on this issue with the Japanese. The United States is also seeking to improve atmospherics with the DPRK, including by increasing cultural exchanges, and Hill highlighted the possible New York Philharmonic performance in the DPRK. ¶3. (S) Ambassador Pedro Moitinho de Almeida reported that the EU was pleased with progress in the Six-Party Talks, as well as developments with the inter-Korean summit. Council Secretariat Asia Unit Head Tomasz Kozlowski explained that SIPDIS the EU's policy is to fully support the Six-Party process, but said the EU's relations with the DPRK is limited primarily to maintaining a communication channel. The United States would welcome the EU's participation in energy or humanitarian aid to the DPRK, and would like to coordinate closely on any such assistance, Hill said. Moitinho reported that the EU would discuss options for supporting the Six-Party process at a meeting in November, including possible humanitarian aid or a Troika visit to Pyongyang. Kozlowski said the EU has given a small amount of humanitarian aid to the DPRK, but is prepared to provide a significant amount upon resolution of the nuclear issue. The EU wants to play a more active role, Kozlowski explained, and is working to determine how best to do that. EU Commission Acting Director Geoffrey Barrett elaborated that the EU has contributed $350 million in humanitarian assistance to the DPRK over the last ten years. The EU is currently working to develop a food security strategy to help the DPRK become more self-sufficient, Barrett said, and the EU will soon hold its third economic workshop in Pyongyang. ¶4. (S) Hill explained that the United States is prepared to begin a peace process on the Korean Peninsula among the directly related parties following substantial disablement and the DPRK's provision of a complete declaration, likely early next year. But, Hill emphasized, the United States cannot conclude peace treaty negotiations until the DPRK has denuclearized. The United States also hopes to create a regional security architecture in Northeast Asia, which would begin with the Six Parties. Moitinho reported that the Russians had provided a read-out of the NEAPSM process at the recent Troika meeting with them. As a regional organization, Moitinho said the EU was encouraged by discussions of a possible Northeast Asia Peace and Security Mechanism, and STATE 00156455 002 OF 006 would be prepared to discuss suitable models at the appropriate time. Hill emphasized the important role of the Chinese in the Six-Party process, and the value of encouraging the Chinese to be more engaged in multilateral diplomacy. Hill noted concerns about China's treatment of North Korean refugees, and requested that the EU work with the United States to press the Chinese and to help find durable solutions for this refugee population. Moitinho said that the EU could approach the Chinese on this issue. JAPAN -------------- ¶5. (C) Hill observed that the new Japanese government is very pragmatic, and is interested in improving relations with its neighbors. The United States wants to help the Fukuda government succeed in building more stable relationships in Northeast Asia. Moitinho agreed with Hill's assessment, and said the EU has encouraged Japan to work toward progress on the abduction issue. Japan Desk Director Jim Zumwalt said the United States currently faces two major issues with Japan: coordinating with Japan in the Six-Party process and maintaining Japanese support for Operation Enduring Freedom. Zumwalt explained Japan's important role in supplying tankers to refuel ships in the Indian Ocean, but said legislation reauthorizing Japan's support may not be passed until sometime next year. Zumwalt requested EU countries' assistance in pressing Japan, as this is a multilateral issue. Moitinho said that the EU Troika is meeting with Japan next week, and while this was an issue between EU member states and Japan, the Troika may also be able to make this point. (Note: An EU colleague subsequently requested talking points on the refueling issue, which EAP/J provided. End Note.) ROK --- ¶6. (C) Turning to upcoming elections in the ROK, Hill said the United States wanted to be very careful to stay out of South Korean politics. De Almedia hoped that the winner of the election would continue the current path of working closely with the Six-Party process. ¶7. (C) On the KORUS FTA, A/S Hill said the U.S. might have a difficult time getting the agreement through Congress, but is committed to getting it approved. Noting that the EU is currently negotiating an FTA with the ROK, Hill surmised that it is useful to hold countries to standards that do not come naturally to them. Barrett said that the EU was still considering whether to include Kaesong in the EU-ROK FTA. Hill stressed that Kaesong was not included in the KORUS FTA. Burma -------------- ¶8. (C) Moitinho emphasized the EU's strong support for UN Special Envoy Gambari and his mission, and more broadly for a multilateral approach to addressing Burma. He said the EU is looking to Gambari to make concrete proposals for the way forward, but is skeptical that the junta can be persuaded to make concessions absent more pressure from Burma's neighbors. The EU is considering appointing a Special Envoy for Burma to work full time on coordinating member states' internal positions and as an informal partner for Gambari. Moitinho stressed that the role of the Envoy would be limited, he would not travel to Burma, and there would be no overlap with Gambari's duties. ¶9. (C) Moitinho and Kozlowski conveyed that the EU is undertaking a second round of demarches to China, India, and ASEAN governments. Moitinho said the EU was gratified by Beijing's statement that Gambari's trip to Burma be more than a courtesy visit and by some Indian criticism of the regime. However, he noted that the EU expects more from India in particular given how often and loudly India touts its title as the world's largest democracy, and the EU is pressing India to be more forward-leaning. The EU was pleased with ASEAN's September 27 statement on Burma, and in response to Southeast Asia DAS Scot Marciel,s query about participation of the Burmese (and at what level) at the upcoming EU-ASEAN summit to mark 30 years of ASEAN-EU relations, said it was using preparatory meetings October 23 with the Singaporeans for the November 22 summit to stress how important ASEAN's action on Burma is to the organization's credibility. The EU does not want to hold its relations with ASEAN hostage to the Burma issue, but it is making clear to its ASEAN partners that it cannot accept business as usual. Moitinho suggested that a small international contact group on Burma would be preferable to one of 20 or more countries, and the EU would support such a group if Gambari proposed one. Moitinho also STATE 00156455 003 OF 006 noted that the EU believed some engagement with the Burmese could be useful, and along these lines said that the troika is likely to meet with Burmese officials on the margins of the next ASEAN Regional Forum ARF as well as the upcoming ASEM meeting in Beijing. ¶10. (C) Moitinho highlighted new EU "smart sanctions" (targeted at the regime vice the broader economy): a ban on imports from Burma's mining and logging sectors, and a ban on exports to Burma of machinery for and investment in those same industries. Visa bans for junta leaders and their families also remain in effect. However, Moitinho opined that EU sanctions are unlikely to be effective and serve mostly to show political support for the democracy cause. Burma-EU trade amounts to only 260 million euros per year and most of that is comprised of textile imports, which will be unaffected by sanctions. DAS Marciel raised pressure from NGOs for more financial sanctions on the regime by the U.S. and EU that would freeze assets and accounts of regime leaders and block dollar and euro denominated transactions. Marciel suggested that the U.S. and EU should have technical level talks to explore such action; the EU was amenable. ¶11. (C) DAS Marciel emphasized the importance of using public diplomacy to sustain public attention to the situation in Burma, especially in countries in the region. He affirmed strong U.S. support for Gambari and agreed with Moitinho about the importance of pressing ASEAN governments to address Burma with ASEAN's credibility in mind. DAS Marciel also flagged the importance of a unified message from the international community pressing for genuine dialogue between the regime and the opposition. Thailand -------------- ¶12. (C) The EU viewed the August constitutional referendum as a positive step toward the restoration of elected government in Thailand, but is concerned about national elections in the wake of the Thai Government's rejection of the EU's proposal for a formal, memorandum of understanding-based EU election monitoring mission. Kozlowksy said the 2006 coup cannot be compared with previous ones, since the continued vitality of political activity in northern Thailand has prevented "Bangkok elites" from restoring their political dominance since the coup. Barrett added that European investors are concerned about the state of Thailand's economy. Moitinho conveyed that EU delegations to the region on Burma business would be exempt from restrictions on contact with Thai interim government leaders, and that the EU continues to press the Thais to lift martial law before the elections. ¶13. (C) Barrett asked if the U.S. had plans to send election monitors to Thailand. DAS Marciel responded that there may be congressional delegations and that our embassy will certainly observe the polls, but said that the Administration is more focused on providing support for Thai monitoring efforts. Barrett also asked for our take on the southern insurgency. DAS Marciel noted that increased security sweeps have not yet made a lasting difference in the level of violence, and emphasized that while the U.S. pays close attention to the insurgency, we avoid actual involvement for fear of inflaming the conflict. China -------------- ¶14. (C) The EU representatives said they were encouraged by China,s increased engagement in international affairs, but they added that the EU continued to feel the need to raise topics such as human rights, anti-corruption, good governance, environmental protection and China,s rapid military build-up as part of the bilateral agenda. As the EU and PRC worked out respective policy papers containing goals for bilateral dialogue, the PRC seemed most interested in eliciting a statement from the EU that Europe accepted the PRC,s &one China principle.8 ¶15. (C) The EU representatives previewed the November 28 EU-China summit. They noted China,s recent positive contributions in the international sphere, including as facilitator of the Six-Party Talks. They described an effort to establish dialogue on Africa, related to development, aid and debt forgiveness. Davies asked how the EU perceived China,s involvement in the matter of Iran,s nuclear program; the EU reps said they believed that Beijing had not acted sufficiently in concert with the rest of the international community in expressing concern over Tehran,s ambitions. Davies asked whether the EU planned to end its arms embargo on China. The EU reps explained that the STATE 00156455 004 OF 006 membership had not reached a consensus, and that China had ceased to demand that the embargo be lifted, in part because Beijing seemed to have determined that pressure was futile, and in part because its current focus was on convincing the EU to issue a joint statement with the PRC on the one China principle. ¶16. (C) The EU representatives described plans to open an EU Centre focused on commerce in Hong Kong, which they said had met with resistance from Beijing, whose officials seemed to feel that it called into question China,s &one country, two systems8 approach to Hong Kong. ¶17. (C) On the recently-adjourned Communist Party Congress, the representatives said that they thought President Hu,s moderate tone on Taiwan was a positive development, but they made clear that they recognized that this was by design, with audiences in the international community and the Taiwan electorate, as well as presidential candidates, in mind. They said they believed there were too many near-term obstacles and distractions, including the Taiwan elections and Beijing Olympics, for the prospect of China-Taiwan dialogue to be realistic for the time being. Taiwan -------------- ¶18. (C) On cross-Strait issues, the EU representatives said they wanted to coordinate policy with the U.S. They informed Davies that they intended to release a statement expressing concern about the ruling DPP,s referendum on UN membership for &Taiwan.8 They said they planned to issue the statement on October 24, the day President Chen had declared &Taiwan-UN Day.8 They noted that the PRC had been annoyed at the EU,s slowness to voice concern over the DPP referendum. They described private demarches to both Taiwan and the PRC, in the former case to warn against provocations and in the latter to ask that Beijing temper its reactions to domestic politicking on Taiwan in an election year. ¶19. (C) With regard to Taiwan,s participation in international organizations, the representatives said they wanted to work with the U.S. to find ways to standardize Taiwan,s involvement in organizations not requiring statehood. They said that they would probably want to wait to launch an initiative until after Taiwan elections, so as not to appear to reward Chen Shui-bian. They noted that they were especially concerned about Taiwan,s lack of access to the WHO and international health-related processes. Philippines -------------- ¶20. (C) DAS Marciel observed that the U.S. saw the Philippines as a long-time ally and friend, which was making a tremendous effort in its battle with terrorism. While the Philippines was enjoying an economic upturn, it struggles with serious problems in governance, infrastructure, and economic reform. The U.S. also has particular concerns regarding the issue of extra-judicial killings (EJKs). DAS Marciel said it was important to continue to push the Philippines government to make progress on this issue, as well as to offer it technical assistance in addressing it. Amb. Moitinho said the EU had the same assessment, and that an EU mission to the Philippines had just presented its report to the member states. RELEX Head of Unit Kozlowski said the EU was not going to engage in investigating EJKs, but would offer forensic assistance to the Philippines government. Indonesia -------------- ¶21. (C) Amb. Moitinho noted that the EU was pleased with developments in Indonesia and wanted to be fully supportive of efforts to improve good governance and rule of law. The EU, he said, wanted Indonesia to be a moderating influence on other Muslim majority countries and the regional Muslim movement. Reporting that the EU was developing a strong relationship with Indonesia, Moitinho said that there would be a Political Director,s meeting in Jakarta on November 8, and that the EU and Indonesia were close to entering into a Partnership and Cooperation Agreement (PCA). The PCA, the EU,s first such agreement in the region, would include clauses on nonproliferation, human rights, and other key issues. Relex H Acting Director Geoffrey Barrett added that Indonesia had threatened to scrap the Agreement over a recent EU recommendation to restrict Indonesian air travel due to safety concerns. ¶22. (C) DAS Marciel agreed that Indonesia has developed in a STATE 00156455 005 OF 006 positive way and has made extraordinary gains in civil society and democracy; however, the country still faces tremendous governance challenges. DAS Marciel said that although the USG was following closely the role of Islam in Indonesian society, it was reluctant to become involved in domestic debates over religion. Indonesia continued to make progress in fighting terrorists, noting that the USG was providing police training and other support. Regional Architecture -------------- ¶23. (C) At lunch hosted by A/S Hill and SCA Acting A/S James ¶F. Moriarty, both sides offered their views on the various regional organizations in East and South Asia. A/S Hill observed that the U.S. supports APEC as a forum for discussion, but is aware of its limitations. He noted our support for ASEAN, and said that Burma had given the organization a real issue to address. In addition to our support for the ASEAN Regional Forum (ARF),we are also &keeping an open mind8 with regard to the East Asia Summit (EAS). EAP/RSP Director Blair Hall said that the U.S. sees a difference between pan-Asian integration and Transpacific linkages. In Washington, APEC is considered the premier Transpacific organization, and the President participates in the annual summits. However, APEC is not necessarily seen in Asian capitals as a vehicle for regional integration. The EAS lacks a clear purpose, and we are continuing to study it from the outside. The U.S. goal is to see both become more action-oriented. There is presently no consensus within the USG concerning possible U.S. accession to the Treaty of Amity and Cooperation (TAC); a pre-requisite to our joining the EAS. ¶24. (C) Concerning integration of South and Central Asia, SCA AA/S Moriarty said said Afghanistan could serve as a bridge between the two regions. India is moving towards a global presence, though the main obstacle it encounters is the pace of its internal reforms. SCA/PDAS Mann said that Central Asia,s dependence on Russian infrastructure for its energy exports allowed Moscow to assert control over the region. The U.S. supported alternate pipelines as a means to bolster the sovereignty and options of Central Asian countries. ¶25. (C) Amb. Moitinho suggested that perhaps the Shanghai Cooperation Organization could evolve into something useful. RELEX Head of Unit Kozlowski said ASEAN was in transition, and that the Burma issue will either strengthen it or do it grave harm. Concerning the EAS versus the ASEAN plus three (China, Japan, Korea) mechanism, he said it is not clear how things will proceed, and that he believes that the Asians are waiting for the U.S. to make a move. Kozlowski noted that The EU-ASEAN meeting in Nuremburg during the German EU Presidency earlier this year was the first time that there was a real political discussion on all issues between the two sides. ¶26. (C) With regard to using a possible North East Asia sub-security architecture as the basis for an expanded regional organization, A/S Hill said the U.S. was only looking at the countries within the region owing to the lack of other institutions. He thought that development of a North East Asian political and security identity would take considerable time. As for wider regional integration with ASEAN &in the driver,s seat,8 Burma will reveal ASEAN,s limitations. RELEX Director Barrett said that the ARF Friends of the Chair might be useful, and that it was essential that ARF discussed proliferation issues. ¶27. (C) On South Asia RELEX Head of Unit Helen Campbell said the EU was working to build customs capacity through the South Asian Association for Regional Cooperation (SAARC). SCA/RSA Director Spilsbury said the U.S. viewed trade facilitation as a critical component of the regional economic integration initiative. Campbell also noted that the EU was interested in coordinating efforts with the U.S. in the lead up to the next Regional Economic Cooperation Conference (RECC) on Afghanistan. The Shanghai Cooperation Organization continues to evolve; notably, the organization,s Bishkek summit did not repeat the Astana declaration, which called for a timetable for the withdrawal of coalition forces from the region. EAP/RSP Director Hall said that the U.S. was encouraged that a human rights body would be established by the ASEAN Charter, although the crucial terms of reference for it have yet to be settled. The ARF Friends of the Chair might be useful on Burma, but it might also prove too difficult. ¶28. (U) European Participants PRESIDENCY (Portugal) Ambassador Pedro Moitinho de Almeida, Special Representative of the Presidency for the Political Dialogue with Third STATE 00156455 006 OF 006 Countries Mr. Luis Brito e Camara, Head of Division, Asia and Oceania Directorate Mr. Francisco Saraiva, First Secretary (Asia, Human Rights) and Head of the Consular Section, Embassy of Portugal in Washington INCOMING PRESIDENCY (Slovenia) Ms. Miriam Teresa Mozgan, Minister Counselor, Deputy Chief of Mission, Embassy of Slovenia in Washington Mr. Tadej Furlan, Second Secretary, Embassy of Slovenia in Washington COUNCIL SECRETARIAT Mr. Tomasz Kozlowski, Head of Unit of the Asia Task Force in the General Secretariat,s Policy Unit Mr. Tim Eestermans, Asia Task Force COMMISSION Mr. Geoffrey Barrett, Acting Director Relex H Ms. Helen Campbell, Head of Unit, Relex H4 (Pakistan, Afghanistan, Bangladesh, Sri Lanka, Maldives) Mr. Franz Jessen, Head of Unit, Relex H2 (China, Hong Kong, Macao and Taiwan, Mongolia) Dr. Laszlo Deak Political Counselor in the Delegation of the EU Commission to the USA RICE