CORRECT COPY: RUSSIAN-SOUTH KOREAN RELATIONS

C O N F I D E N T I A L MOSCOW 003025

SIPDIS

E.O. 12958: DECL: 10/10/2018
TAGS: PREL RS KS KN
SUBJECT: CORRECT COPY: RUSSIAN-SOUTH KOREAN RELATIONS
BECOME STRATEGIC

REF: SEOUL 1912

Classified By: Political Minister Counselor Alice Wells for
Reasons 1.4 (b) and (d)


1. (C) Summary: During South Korean President Lee
Myung-bak's September 28-30 state visit, Russia and South
Korea agreed to upgrade their bilateral relationship,
continue to consider joint gas pipeline and railway projects
that would pass through North Korea, and increase cooperation
on a wide range of political and economic issues,
particularly with regard to North Korean nuclear issues.
While Russia did not press South Korea on Georgia,
negotiations on a joint statement were difficult due to
Russian attempts to insert language aimed at expressing its
displeasure with the United States. Nevertheless, Russian
MFA assured us that Russia understood the importance of the
U.S.-Korean alliance to the stability of the Korean Peninsula
and did not envision a competition with the United States in
Asia. End Summary.

What's in a Name: "Strategic Partnership"
--------------


2. (C) South Korean President Lee Myung-bak's September
28-30 state visit to Russia resulted in an upgrade of the
Russian-Korean relationship from "comprehensive, mutually
trustful" to "strategic," but it was not without some
controversy. According to the South Korean Embassy, the ROK
had originally proposed to characterize the relationship as a
"strategic cooperative partnership," the same formula it used
in its elevation of relations with China in May of this year.
During the negotiations, however, the Russians preferred the
slightly stronger "strategic partnership," which is what
Moscow has with countries such as China and Vietnam, arguing
that linguistically, the two terms were the same. The South
Korean side did not insist on full conformity of the terms.
Therefore, in the final joint statement issued by Presidents
Medvedev and Lee, the Russian version refers to a "strategic
partnership," while the South Korean version, and South
Korea's own informal English translation, call it "strategic
cooperative partnership." As part of the upgraded
relationship, the two governments established a strategic
dialogue chaired by First Deputy Foreign Minister Andrey
Denisov on the Russian side and Deputy Foreign Minister Kwon
Jong-nak on the Korean side.


3. (SBU) In discussing the relationship upgrade with us,
Russian MFA Deputy Director of the First Asia Department Oleg
Davydov sought to assure us that the expansion of cooperation
with South Korea, and increased ties with East Asian
countries in general, reflected a Russian interest in
developing its Siberian and Far East regions, and should not
be misinterpreted in a threatening light. "We are not
expanding ties in Asia for expansion's sake." He indicated
that Russia responded to the ROK initiative to upgrade the
relationship while fully recognizing South Korea's special
relationship with the United States and the priority status
of the U.S.-Korean alliance. According to him, Russia does
not wish to undermine that alliance, because it understands
this is not a zero-sum game, and that a weakening of the
U.S.-Korean relations could result in instability on the
Korean Peninsula, which would not be to Russia's interest.
"The United States has its sphere of interests, and we have
our own," he said pointedly, referring to the former Soviet
space.

A Wide Ranging Joint Statement...
--------------


4. (C) The six-page joint statement adopted during
President Lee's visit touches upon a wide range of political
and economic issues, including North Korea, Georgia,
counter-terrorism, expanded cooperation in international
organizations, Russian WTO membership, energy cooperation,
simplified visa procedures for South Korean businesses, and
improved trade and investment ties. South Korean Embassy
First Secretary Jung Kang confirmed reftel reporting that the
negotiations were difficult. While the Korean side wanted to
focus on future cooperation in the economic areas, the
Russian side stressed geopolitical issues and wanted to
insert certain charged words that reflected Russian
dissatisfaction with a perceived U.S.-dominated international
system. It took considerable effort for the ROK to keep such
content out.


5. (C) In particular, Jung told us that the Russians wanted
to mention in the joint statement the financial crisis in the
United States and its effect on the international system.
Seoul would not agree to such language. While the issue was
ultimately excluded from the statement, the MFA indicated
that the two presidents did discuss it and agreed to work
together to contribute to the financial health of the world
economy. Davydov hinted that the two sides may set up a
consultative mechanism in this regard, but that there were no
specific plans yet.

...and Georgia is on the Last Page
--------------


6. (C) Given the difficulties in negotiating the joint
statement, the ROK was pleasantly surprised that the expected
Russian pushiness to insert unacceptable language on Georgia
never materialized. While the statement refers to the issue,
it is buried on the last page, and the agreed language, that
"the situation should be settled through dialogue, which
would contribute to regional stability and international
peace," was mild enough that it did not put the ROK in an
awkward position. Jung indicated that when South Korean
FoQign Minister Yu Myung-hwan visited Moscow September 9-11
to prepare for the Lee visit, the Russians similarly did not
dwell on Georgia beyond a brief mention by FM Lavrov that
Moscow hoped for Seoul's understanding of the necessity of
the Russian action in response to Georgian aggression.

North Korea a Central Focus of Discussions
--------------


7. (C) We understand that during President Lee's two-hour
meeting with President Medvedev and the subsequent lunch that
Medvedev hosted, the two sides discussed at length the North
Korean nuclear issue and the Six Party Talks. The MFA
reported to us that there was no daylight between the Russian
and South Korean positions -- that denuclearization was a top
priority, North Korea must live up to its obligations in this
regard, and a verification mechanism set up according to
international rules was necessary. Davydov indicated that
the GOR wished to see an enhanced role for the International
Atomic Energy Agency (IAEA) in the verification mechanism and
would welcome a more detailed readout of Assistant Secretary
Hill's recent discussions in North Korea. (N.B. Post has
since been in touch with EAP and conveyed to the MFA that A/S
Hill provided Russian Ambassador to China a readout of the
trip.) Commenting on Russia's chairmanship of the Fifth
Working Group, he said that Moscow viewed the creation of the
Northeast Asia Peace and Security Mechanism as a long term
issue. While discussion on this could occur in parallel with
the more immediate negotiations on the verification protocol,
the process of denuclearization must always take first
priority.


8. (SBU) During his visit, President Lee oversaw the
signing of an MOU between Russian gas monopoly Gazprom and
Korean Gas on the sale of 10 bcm of gas per annum via a
pipeline running through North Korea, with deliveries
beginning as soon as 2015. The Russian side also pressed for
South Korean participation in a project to link the
trans-Korean Railway with the Trans-Siberian Railway through
the reconstruction of the Khasan-Rajin branch that would
connect the Russian border town of Khasan with the North
Korean port city of Rajin. The GOR envisions using the
Khasan-Rajin branch to move South Korean and Chinese goods
that are carried by sea freight from Pusan. According to the
South Korean embassy, while the gas pipeline and the railway
connection projects have been under discussion for quite some
time, this is the first time that Russia and South Korea have
jointly and publicly announced the intention to consider
cooperating on the two issues.


9. (C) The MFA told us that the GOR understood that any
South Korean decision to participate in the pipeline and
railway projects was contingent on progress in North Korea's
nuclear disarmament and the relaxation of North-South
tensions. The current Russian assessment is that no real
dialogue is occurring between Lee's administration and the
North Koreans, and relations between the two Koreas are
tense. This leaves South Korean participation in the two
projects a big question mark. The ROK, for its part,
believes Russian influence on North Korea is limited,
according to Jung Kang. However, Seoul sees Russian
influence on Pyongyang to be greater that its own, and hopes
Russia will be able to engage the DPRK in a constructive way
and assume the bulk of the political risk associated with
involving North Korea in the two projects.

Economic Cooperation Also a Key Focus
--------------


10. (C) The bilateral economic relationship figured
prominently in President Lee's discussions with his Russian
interlocutors. Both the MFA and the South Korean Embassy
expressed to us their satisfaction with the growing bilateral
trade and investment between Russia and South Korea.
Accumulated Korean investment into Russia is $2 billion and
growing (though Russian investment to South Korea lags behind
at $12 million). Bilateral trade has increased 15% a year
for the past five years. According to Davydov, this year's
trade volume between the two countries is expected to reach
$20 billion, and a doubling of the number to $35-40 billion
is forecasted within the next three to four years. The two
sides agreed to jointly develop oil fields in West Kamchatka,
as well as to cooperate on infrastructure building projects
in preparation for Vladivostok's hosting of the 2012 APEC
summit and Sochi's hosting of the 2014 Winter Olympics.
Russia invited South Korean participation in the
International Uranium Enrichment Process Center, though Seoul
remains noncommittal on this.

Comment
--------------


11. (C) The timing of President Lee's visit, in the
immediate aftermath of Russian aggression in Georgia, gave
Russia a diplomatic boost. Still, the ROK has many immediate
economic and political interests in expanding its bilateral
relationship with Russia. As reflected by the difficulty the
South Koreans experienced in negotiating the joint statement
language, Moscow continues to seek opportunities to take a
swipe at the United States. End Comment.


RUBIN