ESTONIA: SCENESETTER FOR VISIT OF DHS SECRETARY

UNCLAS SECTION 01 OF 04 TALLINN 000363 SENSITIVE SIPDIS DHS FOR SECRETARY CHERTOFF FROM AMBASSADOR PHILLIPS DEPT FOR CA/VO/F/P ABIGAIL RUPP, BRENDA GREWE DEPT FOR EUR/PGI IVAN WEINSTEIN DHS FOR ALLISON BOYD, MARC FREY, CLAYTON SANDERSON, CHRIS MITARAI, MARK KOUMANS E.O. 12958: N/A TAGS: OVIP PREL CVIS AMGT ASEC AFIN EN SUBJECT: ESTONIA: SCENESETTER FOR VISIT OF DHS SECRETARY CHERTOFF ¶1. (SBU) Summary. Mr. Secretary - welcome to Estonia! Your October 29 visit to Tallinn is a significant milestone in our bilateral relationship with Estonia, and will be seen here as the fulfillment of the President's promise of Visa Waiver Program (VWP) membership made during his 2006 visit to Tallinn. Accession to VWP has been a long-standing priority for the Government of Estonia (GOE),and there is keen interest regarding the announcement of the first date on which travel may commence under the program. While there are just over 110,000 Russian-speaking "stateless" residents of Estonia who will not be able to participate in VWP, the GOE hopes that VWP will provide another incentive for these non-citizens to naturalize. ¶2. (SBU) A member of NATO and the EU since 2004, Estonia is a steadfast ally on all fronts. Estonian forces participate actively in international military operations including Iraq, Afghanistan and Kosovo. Estonia relies on NATO guarantees for its security, particularly in light of the Russian invasion of Georgia and the often tense nature of Estonian-Russian relations. Estonia is a role model for democratic reform and development in former Soviet states (and beyond),and has taken on a leadership role in promoting international cooperation on cyber-security. Economically, Estonia's growth has slowed significantly in the past 12 months and unemployment is creeping up. The Estonian banking sector has weathered the global financial crisis -- so far. Estonia joined the Schengen area in December, 2007. End Summary. STRONG BILATERAL TIES ¶3. (SBU) The United States and Estonia are strong allies and partners. Appreciation for U.S. non-recognition of the Soviet occupation of Estonia remains an important source of good will towards the United States. In April 2007, the USG voiced strong public support for Estonia during riots, cyber attacks and deteriorating relations with Russia after the GOE decided to relocate a Soviet era memorial away from the center of Tallinn. One major challenge for our public diplomacy efforts, however, remains to engage the next generation of Estonians to ensure that U.S. - Estonian relations remain strong for the long term. IN THE HOMESTRETCH FOR VWP ¶4. (SBU) VWP has long been a priority for the GOE. Estonian officials raise the issue at every senior bilateral meeting. GOE officials and the traveling public have become increasingly anxious to know when VWP travel may begin, especially since Estonia completed all substantive steps for participation in the program with the signing last month of the Agreement on Enhancing Cooperation on Preventing and Combating Serious Crime (PCSC) in Washington. The President's announcement of VWP expansion on 17 October was well-received and widely-covered in Estonia. ¶5. (U) The Embassy has engaged in considerable outreach to ensure that Estonian travelers are aware of the biometric passport requirement and the ESTA requirement. We have also worked to remind the many Russian passport holders and Estonian "gray" (stateless) travel document holders that only Estonian citizens will be able to participate in the program. The GOE has made a number of statements recently that VWP could provide another incentive for stateless Estonians to consider pursuing naturalization as Estonian citizens. ¶6. (SBU) Your announcement of the VWP travel date, the immediate availability of ESTA to Estonian citizens, as well as soon-to-be-announced inclusion of Estonian as an available language on the ESTA website, are anxiously awaited and will be well-received. Questions received by the Embassy following the President's announcement of VWP expansion on 17 October suggest that the Estonian public is still confused about some aspects of the program. It would be particularly helpful for you to emphasize the following during any press interviews: (1) that only Estonian citizens holding biometric passports are eligible to travel visa free (i.e., only Estonian passports issued after 22 May 2007), (2) that ESTA requires substantially the same information as required on Form I-94W, rather than the more substantial amount of information required from visa applicants, and (3) that those who already hold valid U.S. visas need not comply TALLINN 00000363 002 OF 004 with ESTA and biometric passport requirements. SCHENGEN ¶7. (SBU) Estonia joined the Schengen Area on December 21, 2007, abolishing passport controls for intra-Schengen flights, as well as land and maritime border control at ports of entry connecting to other Area members (in this case land borders with Latvia, and maritime connections with Finland and Sweden). The GOE maintains a strict regime of checkpoints on its Eastern border with Russia and has retained border checks at the airport for travelers arriving from non-Schengen states. Estonia received 77 million Euros in Schengen Facility aid to improve surveillance capacity on the Russian and sea borders, and to integrate its entry-control and visa systems with the Schengen Information System (SIS),a common lookout and records database. WAR ON TERROR ¶8. (SBU) Estonia is a strong supporter of the U.S. position in the War on Terror. Estonian troops participate in NATO operations (in Afghanistan and Kosovo),EU operations (the EU's Nordic Battle Group),Operation Enduring Freedom in Iraq and other missions (including the UN mission in Lebanon). A company of 140 Estonian soldiers is deployed to the southern province of Helmand (the epicenter of Afghanistan's opium production and a stronghold for the Taliban). In Iraq, Estonian soldiers are embedded with U.S. troops in some of the toughest counter- insurgency operations outside of Baghdad. To date, five Estonian soldiers have been killed, and 45 wounded, in Iraq and Afghanistan. The GOE is on track to meet its NATO commitment of devoting 2 percent of its GDP to defense spending by 2010 (currently at approximately 1.7 percent) and is a vocal supporter of NATO enlargement, particularly in light of the Russian invasion of Georgia. REGIONAL DEMOCRACY PROMOTION ¶9. (U) Estonia's experience of transforming itself from a Soviet-occupied country into a healthy democracy with a strong economy has given it immense credibility in promoting democracy and transformational diplomacy in the region. The GOE has provided training in law enforcement, judicial reform, freedom of the press, democracy building, economic and market reforms and IT to civil servants and military personnel from the Balkans, Georgia, Moldova and the Ukraine. RELATIONS WITH RUSSIA ¶10. (SBU) Estonia's relationship with Russia is difficult and complicated following nearly 50 years of Soviet occupation, and has become even more so following Russia's invasion of Georgia in August. Estonia has strongly supported Georgia's reform process. Senior GOE officials travel regularly to Georgia and about one-third of Estonia's bilateral assistance budget is spent in this country. Former Prime Minister Mart Laar serves as a personal advisor to Georgian President Mikheil Saakashvili on political and economic reform. Shortly following the Russian invasion, Estonian President Ilves and Foreign Minister Paet made high-profile visits to Georgia to show their solidarity with the Georgian government and people. Estonians view the Russian invasion of Georgia with alarm, given the large number of Russian citizens and ethnic Russians living in Estonia, and are keenly looking to the security guarantees of Article V of NATO. ¶11. (SBU) While Russia and Estonia continue to share trade and investment ties, they have not been able to conclude a border treaty. Depending on the political climate and bureaucratic inefficiencies, hundreds of trucks crossing from Estonia into Russia may encounter delays of up to one week. Estonia's decision to relocate a Soviet era monument (the Bronze Soldier) was followed by riots of ethnic Russians in Tallinn in April ¶2007. Following the riots, Russia put heavy economic and diplomatic pressure on Estonia - including refusing to disperse a mob outside the Estonian Embassy in Moscow for several days, limiting rail and truck traffic across the border and encouraging a boycott of Estonian goods. Rail traffic (oil, coal, wood and other materials) is still down significantly, reducing Estonia's transit revenues and complicating supply lines for Estonian companies. ¶12. (SBU) Ethnic Russians make up approximately 25 percent of TALLINN 00000363 003 OF 004 the population of Estonia. Some ethnic Russians hold Estonian passports, while others hold either Russian passports or "gray" (stateless) passports issued by the Estonian government. Russia has frequently complained about GOE treatment of its Russian speaking minority. However, until the Bronze Soldier riots, Estonia's efforts to integrate its minority population were viewed as a model for the region. While Estonia can still point to significant accomplishments of its integration strategy, the riots revealed that deep fissures remain between ethnic Russians and Estonians living in Estonia. The GOE, which has traditionally engaged in language-based integration programs, has launched a new strategy that focuses not only on language and citizenship issues, but also on society building and cultural understanding among Estonians of all ethnicities. CYBER WARFARE ¶13. (SBU) In April/May 2007 (following the Bronze Soldier riots),cyber attacks targeted government and private sector websites in Estonia. The attacks, which lasted for approximately one month and ranged from simple spam postings to coordinated DDOS (Distributed Denial of Service) attacks, caused severe service disruptions to websites, servers and routers linked to government, banking, media and other resources. These highly coordinated cyber attacks captured widespread international media attention. The United States and NATO quickly sent experts to Tallinn. Since the attacks, the GOE has taken a leadership role on cyber security within NATO, the European Union (EU) and other organizations, becoming an important player in international cooperation on cyber defense. Estonia sent advisers to Georgia following a cyber attacks that coincided with Russia's invasion of that country. The GOE is working with NATO to make its national Cooperative Cyber Defense Center (CCD) a NATO Center of Excellence (COE). In November, 2007, the United States was the first country to send a representative to the CCD, although we are not an official "Sponsoring Nation" yet. ECONOMIC PERFORMANCE ¶14. (U) Until recently, Estonia's economy was growing at 7-11 percent per year. This year, however, economic growth has slowed to almost zero. The state budget has been in surplus since 2001, but falling tax receipts have translated into painful budget and personnel cuts for the GOE. So far, the Estonian banking sector, which is controlled by Scandinavian banks, has weathered the global financial crisis well. The national currency, the Kroon, is pegged to the Euro, but inflation will keep Estonia from joining the Euro zone before ¶2012. ¶15. (SBU) The United States is the eighth-largest foreign direct investor; U.S. direct investment accounts for less than 2.5 percent of total FDI. Estonia is known internationally for its highly developed IT sector and widespread use of technology in government and daily life. Internet usage in Estonia is over 60 percent, and online banking is upwards of 80 percent - both the highest in Europe. Cabinet ministers work on the basis of e-government and Estonia was the first country in the world to offer e-voting in a nationwide election. Large domestic oil shale reserves have allowed Estonia to remain relatively independent of Russian energy supplies, although Estonia imports all of the natural gas it uses from Russia. MEDIA ENVIRONMENT ¶16. (U) The Estonian media have shown considerable interest in Estonia's progress towards joining the Visa Waiver Program (VWP). Reports are typically neutral and reasonably well- informed but some outlets have been critical and/or confused about the new security requirements and ESTA. In addition to Embassy outreach on VWP, the GOE has remained on message and extremely knowledgeable in public statements about the mechanics of VWP, including ESTA. ¶17. (SBU) The media in Estonia are ranked among the most free in the world. The 2008 Reporters Without Borders press freedom index ranked Estonia as the fourth most free country. Competition and variety among print, television, radio, and Internet sources is robust in both Estonian- and Russian- language formats. Media resources in Estonia are limited and coverage is generally restricted to local and regional issues and to international issues that have a direct bearing on TALLINN 00000363 004 OF 004 Estonia. Television is the most popular source of news in Estonia, but newspapers still play an important role in providing serious news as well as in-depth commentary. Internet penetration is very high, particularly among young Estonians, although much of the content is repeated from the more traditional media outlets. Tabloid-style papers are very popular, and while they often adhere to a lower standard of journalism, they do provide a reasonable level of reporting on serious news. One area of concern is that television and radio broadcasts originating in Russia are a leading source of news for many of Estonia's Russian-language speakers, particularly in northeastern Estonia, where Russian-origin television broadcasts can be picked up by antenna. The Estonian Government is considering expanding the amount of Russian-language television programming available to Estonia's Russian-language speakers in order to offer more balanced and neutral news coverage. ¶18. (U) Your visit will be a highlight for the whole year. Again, I welcome you to Estonia, and look forward to seeing you in Tallinn on October 29. PHILLIPS