SCENESETTER FOR SECRETARY CHERTOFF'S VISIT TO

C O N F I D E N T I A L SECTION 01 OF 04 PRAGUE 000674 SIPDIS STATE FOR EUR/CE E.O. 12958: DECL: 10/22/2018 TAGS: PREL PGOV EZ SUBJECT: SCENESETTER FOR SECRETARY CHERTOFF'S VISIT TO PRAGUE Classified By: A/DCM JOHN LAW FOR REASONS 1.4 (B) AND (D). ¶1. (C) SUMMARY: Secretary Chertoff, Embassy Prague looks forward to welcoming you to the Czech Republic. Your visit will underscore the importance of our strong transatlantic partnership, which has received a significant boost from the President's announcement of the Czech Republic's entry into the Visa Waiver Program. The Czech government, under Prime Minister Topolanek, views Missile Defense as the natural next step in our increasingly close cooperation. The Czechs' growing engagement internationally - from Kosovo to Afghanistan - also demonstrates their commitment to our two countries' shared security priorities. In addition, your visit will help set the stage for an even closer U.S.-Czech collaboration during the upcoming Czech EU Presidency on our transatlantic priorities. END SUMMARY. -------------- Domestic Context -------------- ¶2. (C) Nineteen years after the 1989 Velvet Revolution, the Czech Republic today is a prosperous market economy, a stable democracy, and a committed American ally. Accession to the European Union in 2004, like accession to NATO in 1999, has solidified and accelerated the transition away from the country's communist past. The economy today remains relatively strong, with significant investment flows, modern manufacturing base, conservative banks, low unemployment and moderate but declining inflation. The country has so far escaped the worst of the global financial crisis. The Prague stock exchange has suffered heavy losses, but relatively few Czechs are invested in the market and few Czech companies use it as a source of capital. The crisis has also contributed to a slow down of Czech economic growth, largely by depressing demand within Western Europe for Czech exports. Analysts are now forecasting that Czech real GDP will increase about four percent in 2008 and between two-and-half and three percent in 2009, after three years of over six percent growth. ¶3. (C) PM Topolanek, who will meet with President Bush on October 29 in Washington, suffered a sweeping defeat in the country's regional and senate elections. Although his government survived a no-confidence vote on October 22, the poor electoral results have seriously undermined his chances at reelection as chairman of the ruling Civic Democratic Party (ODS) during the upcoming ODS party congress in December. If he loses the December contest, Topolanek is unlikely to survive as prime minister. At the same time that Topolanek is struggling to shore up his position within his party, he has to keep on track his government's key priorities, among them Missile Defense and preparations for the Czech EU Presidency, which the Czechs assume in January ¶2009. -------------- U.S.-Czech Relations -------------- ¶4. (C) Our two countries enjoy excellent relations. The Czechs are active in the war on terror, with troops in Iraq, Afghanistan, and the Balkans. The country is active within NATO and the EU, and generally supportive of U.S. policy goals. This is particularly the case regarding democracy promotion. The Czechs are our strongest partners in Europe on Cuba, and active supporters of the democratic opposition in Cuba. Likewise in Georgia, Belarus, Burma, Iraq and other countries in transition, the Czech government and NGOs work to support peaceful transformation and pass along the lessons learned from the Czechs' own history. Prague has been home to the U.S.-funded Radio Free Europe/Radio Liberty since 1995, and has actively supported broadcasts to countries in Eastern Europe, Central Asia and the Middle East, including Iran. -------------- Visa Waiver -------------- ¶5. (C) PM Topolanek and his government fully appreciate the President's personal commitment to the Visa Waiver Program's expansion. The President's October 17 announcement of the Czech Republic's entry into the Visa Waiver Program was widely covered in the Czech Republic. Your visit to Prague will amplify the President's message of friendship and partnership. The choice of November 17, if confirmed as the entry date into the Program, would add further symbolism to this moment because most Czechs are naturally proud of their PRAGUE 00000674 002 OF 004 achievements during and since the Velvet Revolution on November 17, 1989. During your visit to Prague, PM Topolanek and his government will seek to play up this much-anticipated milestone, which eliminates the one major irritant in our otherwise positive bilateral relationship. While not formally linked, the Czech public has always connected the Visa Waiver Program and Missile Defense, given that these initiatives have advanced roughly in the same time frame. -------------- Missile Defense -------------- ¶6. (C) The United States has proposed to build a missile defense (MD) radar 90 kilometers south of Prague in Brdy. Coupled with the planned deployment of interceptors in Poland, the radar facility will provide Europe and the United States with a defense against ballistic missiles from Iran or other rouge nations. For PM Topolanek and his government, Missile Defense is about more than preventing a ballistic missile attack on Europe. He believes that, in addition to his country's membership in the EU and NATO, the Czech Republic must forge a robust trans-Atlantic relationship, including by partnering with the United States and Poland on the European MD site. PM Topolanek, who fully appreciates the importance of U.S. engagement in Europe, views MD as the natural next step in the U.S.-Czech relationship. In the wake of the Russia-Georgia conflict, PM Topolanek also views MD as critical in the context of Russia's assertive policies toward Central Europe and former Soviet republics. However, with up to 65 percent of Czech public opposing MD and his own coalition divided on the issue, Topolanek has taken a great political risk with his committed pro-MD stance. When possible, please note that by hosting the MD radar site, the Czech Republic takes a leading role in its defense as well as that of its European allies and the United States. ¶7. (C) In the course of 2007 and 2008, the United States negotiated with the Czechs two MD agreements, the Ballistic Missile Defense Agreement (BMDA) and the Status of Forces Agreement (SOFA). The Czech parliament must now ratify these agreements, as well as a constitutionally-required resolution permitting the stationing of U.S. troops on Czech soil. The government is expecting a tough fight in the narrowly divided parliament in the coming weeks. PM Topolanek's current tenuous political position, as well as his less than stable coalition with the smaller Christian Democrats and the Czech Greens, raises new questions about his ability to push through the ratification. ¶8. (C) We have never tied visa waiver to MD. However, some in the Czech government and a portion of the public clearly see the Czech Republic's entry into the VWP, as almost a quid pro quo for hosting the radar. We expect that the press will ask you about the relationship between VWP and MD. We do not want to tie the two, but the timing of your visit and the announcement of the Czech Republic's participation may help increase the chances that the parliament will ratify the MD agreements. By noting that the Czech Republic will join the Visa Waiver Program along with six other well-qualified nations, you will simultaneously underscore that the Czech people earned this privilege by respecting the terms of their visas and show that Czech participation in the Program was in no way contingent upon a positive Missile Defense outcome. -------------- -------------- Czech EU Presidency, Russia/Energy, and Justice Issues -------------- -------------- ¶9. (C) The Czechs are increasingly focused on their upcoming EU Presidency during the first half of 2009. The Czech agenda has an overarching theme "Europe Without Borders" and focuses on three priority areas: EU Competitiveness, Energy Security and Sustainability, and External Relations. Within External Relations, the Czechs plan to focus on the Western Balkans, transatlantic relations, and the EU's Eastern Neighborhood Policy. We share the same broad goals with the Czechs; the challenge will be finding a way to help the Czechs forge an EU consensus close to our shared goals. To reaffirm the United States and the EU's strong relations, the Czechs have begun to press for an early visit to Prague by the next U.S. President during their six months at the EU's helm. ¶10. (C) A key challenge for the Czech Presidency will undoubtedly be the EU's policy toward Russia. Overall, the Czechs are and will continue to be a valuable ally on Russia within the EU. However, they are keenly aware that as the incoming EU President, they must temper their government's PRAGUE 00000674 003 OF 004 views on Russia to achieve an EU consensus. Energy security is a related issues, since the Czechs are especially concerned about the reliability of Russian supplies and Russian efforts to buy up Central European energy infrastructure and assets. The Czech Republic is dependent on Russia for 70 percent of its gas, 65 percent of its oil, and 100 percent of its nuclear fuel. The level of Russian crude oil deliveries to the Czech Republic has declined -- ostensibly for technical reasons -- since the United States and Czech Republic signed the Ballistic Missile Defense Agreement in early July. Czech energy security goals include progress on a more united and coherent EU energy strategy, support for Nabucco and greater outreach to Caspian energy producers. To this end, the Czechs are planning an EU-Trans-Caspian Summit, tentatively scheduled for May 2009. The Czechs have suggested that we can play a useful role by timely support of Czech energy security-related initiatives during their presidency. ¶11. (C) Justice and security-related cooperation falls under the broad range of Czech EU Presidency priorities covered within External Relations. Together with the EU we have an informal High Level Contact Group (HLCG) which focuses on privacy and personal data protection in the context of the exchange of information for law enforcement purposes, particularly related to fighting and preventing terrorism and serious transnational crime. As a result of HLCG's work, we now have international agreements between the United States and EU governing Extradition and Mutual Legal Assistance (2003),Passenger Name Record data (2007),as well as agreements with Europol (2002) and Eurojust (2006) governing personal data exchange. The Czechs have ratified the Extradition and Mutual Legal Assistance Agreement, but they will have a role to play in encouraging the final four EU member states (Belgium, Greece, Ireland, and Italy) to ratify this document, if this is not completed before the upcoming U.S.-EU Justice and Home Affairs Ministerial on December 12 in Washington. -------------- Reliable Allies in Missions Abroad -------------- ¶12. (SBU) The Czechs remain actively engaged supporting U.S. and NATO-led coalitions. Czech soldiers are currently deployed in Iraq (approximately 20 trainers in Baghdad and at the Iraqi Armor Training Center in Taji) and Afghanistan, where the number of troops is currently just under 500. In March 2008, the Czechs established the first provincial reconstruction team (PRT) in Logar province south-east of Kabul. Along with the sizable Czech commitments in Afghanistan, they have an infantry battalion of around 450 troops permanently deployed in Kosovo. ¶13. (C) The Czech government developed plans to increase the total number of Czech troops deployed abroad from approximately 900 this year to just over 1380 in 2009, with an increase in Afghanistan from 495 in 2008 to 745 troops in ¶2009. The parliament must now approve the deployments legislation. The proposed increase of Czech troops in Afghanistan, coupled with the MOD's failure to reach out to the opposition, has already generated questions from across the political spectrum and raised doubts about the deployment bill's prospects. Therefore, if it is appropriate, we would encourage you to thank the Czechs for their contributions and underline how the exemplary service of their soldiers and reconstruction experts in an increasingly fragile security environment is helping the Afghan people build a stable and more prosperous country, a goal of the entire international community. -------------- A Strong and Valued Partnership -------------- ¶14. (C) Despite its small size and at times unsettled political scene, the Czech Republic has consistently proven to be a reliable and active ally of the United States. The Czechs are appreciative of the positive role the United States has played at key moments of their history. During your meetings, Czech officials will likely highlight the country's 90th anniversary and point to President Woodrow Wilson's support and efforts, which helped bring the Czechoslovak Republic into being on October 28, 1918. The Czechs, in turn, are proud of their contributions to security, democracy, and freedom around the globe since 1989. For PM Topolanek, the entry into the Visa Waiver Program and the planned MD radar in the Czech Republic are a testament to his country's progress and to the strong ties between our PRAGUE 00000674 004 OF 004 countries. The key themes for your meetings and public statements should be: highlighting the country's Visa Waiver Program entry; recognizing Czech contributions and partnership in promoting global democracy, freedom and security; expressing appreciation for Czech willingness to enhance common defense through participation in foreign missions and support for the MD shield; and setting the stage for close U.S.-EU cooperation under the Czech EU Presidency. Graber