AMBASSADOR'S TOUR D'HORIZON WITH FEDERATION

C O N F I D E N T I A L MOSCOW 002032

SIPDIS

E.O. 12958: DECL: 07/15/2018
TAGS: PREL PGOV RS
SUBJECT: AMBASSADOR'S TOUR D'HORIZON WITH FEDERATION
COUNCIL FOREIGN AFFAIRS COMMITTEE CHAIR MARGELOV

REF: A. MOSCOW 1904

B. MOSCOW 1769

Classified By: Ambassador John R. Beyrle. Reasons 1.4(b) and (d).


1. (C) Summary. Ambassador and Federation Council Foreign
Affairs Committee Chair, Mikhail Margelov discussed Georgia,
Iran and the U.S.-Russia 123 Agreement, NATO Membership
Action Plan for Ukraine and Georgia, Missile Defense,
Medvedev's proposal for a new European security architecture,
Afghanistan, and U.S.- Russia business relations. Margelov
said he would raise many of these issues in meetings in
Washington and New York at the end of the month. Ambassador
noted that the U.S.-Russia relationship transcended bilateral
issues and had global implications, and noted the importance
of building on the positive areas of the relationship. He
stressed the importance of Russia taking action to defuse the
crisis in Georgia, and urged Margelov to discuss the 123
Agreement and Russia's WTO aspirations with his counterparts
in the U.S. Congress. End summary.


2. (C) In an initial tour d'horizon with Margelov, the
Ambassador noted that the bilateral relationship had grown,
and many of the issues the U.S. and Russia were engaged in
had a global impact. Thus, as Under Secretary Burns had
indicated in his recent Congressional testimony, it was
important to note the areas where we cooperated well. Our
efforts on reducing nuclear weapons and strengthening
security of nuclear materials and sites, particularly through
the Nunn-Lugar agreement were significant achievements.
Margelov agreed, emphasizing that such joint efforts had
paved the way for the 123 Agreement on civil nuclear
cooperation.

Georgia
--------------


3. (C) Margelov told Ambassador that he had been surprised at
the deterioration of the situation with respect to Georgia
and Abkhazia. Noting that both Russia and Georgia had made
mistakes, he said the current situation was good for neither
country and he was concerned we were losing time to resolve
the issue. He said there were "some" in both Moscow and
Tbilisi who wanted to "talk and find a solution," but there
were others in Russia who were "stupid and willing to take
the bait" provided by Saakashvili. Chechnya was on both
countries' borders, and could become a bigger problem for
Georgia. Saakashvili would never agree to unification by
force, Margelov said, and suggested that the negotiators
focus on finding an economic basis for the solution. This
would provide guarantees to the "elites," and could leverage
the desire for business opportunities provided by the 2014
Olympics in Sochi. Noting that the Council of Europe
Parliamentary Assembly (of which he is a member) had offered
to Georgia to use its negotiation mechanisms, Margelov said
it was necessary for someone to "stop the cycle."


4. (C) The Ambassador replied this was why it was important
for us to stay engaged in the situation, and why the
Secretary had traveled to the region. He stressed that while
we could encourage Saakashvili to sign a non-use of force
agreement, Russia would need to take steps as well,
particularly on the measures in Putin's April 16 Decree.

Iran and 123 Agreement
--------------


5. (C) The Ambassador emphasized the importance of Russian
actions in getting the 123 Agreement approved, noting that
while we differed tactically on Iran, our strategic goals
were very similar. Margelov said he would advocate for
approval of the 123 Agreement during his meetings in
Washington July 21-24, and agreed that Russia did not want to
see Iran acquire nuclear weapons.

NATO MAP/Missile Defense
--------------


6. (C) Margelov stressed that a NATO Membership Action Plan
for Ukraine and Georgia was a very sensitive issue for
Russia, and that Ukraine in particular was approaching the
issue the wrong way. Medvedev would find it very difficult
if he was forced to target missiles at Ukraine or Poland or
the Czech Republic. But some Russian military insisted they
needed to have plans to respond to the potential threats
caused by NATO enlargement and a missile defense system in
Eastern Europe. In response to a question by the Ambassador,
Margelov said he had been surprised by the harshness of the
MFA statement following the Secretary's signing of a missile
defense agreement with the Czech Republic (septel).

New European Security Architecture/Afghanistan
-------------- -


7. (C) Ambassador inquired about Margelov's plan to hold
hearings on Medvedev's proposal for a new European Security
treaty and summit (reftels). Margelov responded that FM
Lavrov had been ready to appear on July 17, but due to the
Council's summer recess, they had decided to postpone the
debate until September. Noting that he had been with
Medvedev in Berlin when he made the proposal, Margelov said
that if we really wanted to put the remnants of the Cold War
behind us, we needed to rethink the European security
architecture. What we had today was inherited from World War
II and Potsdam (except for OSCE, he acknowledged),and if we
all agreed that the world had changed, we needed a new
approach. It might take two-to-three years to achieve, but
otherwise we would simply be putting "patchwork fixes" on the
current system. Stressing that the proposal was not
anti-NATO or anti-EU, Margelov said that Russia merely wanted
to begin the discussion, which should include all the
existing European organizations, such as NATO, the EU, the
OSCE, and Council of Europe.


8. (C) The Ambassador stressed that Russia needed NATO's
success in places like Afghanistan, and said there was
significant scope for greater cooperation in the NATO-Russia
Council, and possibly eventually on the ground in
Afghanistan. Margelov concurred, highlighting the
NATO-Russia Transit Agreement, approved at the Bucharest NRC
summit.

U.S.- Russia Business Relations
--------------


9. (C) Margelov praised the growth in U.S.-Russia business as
one of the highlights of the last eight years in the
bilateral relationship. He characterized what Severstal was
doing in the U.S. and International Paper was doing in Russia
as "amazing," and noted that Microsoft now had 34 offices
inside Russia. He said he would be exploring in Washington
ways he could expand on his "road show," in which he visited
12 American cities in two trips to promote U.S.-Russian
relations, and business. He expressed the hope that Members
of Congress would engage in similar visits in Russia.


10. (C) The Ambassador said there were tremendous strategic
opportunities in Russia for business, and this was why
problems like those affecting TNK-BP were so frustrating.
BEYRLE