DAYTON ARTICLE IV ON EX-YUGOSLAVIA ARMS

C O N F I D E N T I A L SECTION 01 OF 04 USOSCE 000204

SIPDIS

STATE FOR VCI/CCA, EUR/RPM
NSC FOR DEFENSE POLICY & STRATEGY
JCS FOR J5/COL NORWOOD
OSD FOR ISA (PERENYI)

E.O. 12958: DECL: 05/20/2018
TAGS: BK KCFE OSCE PARM PREL RS SR
SUBJECT: DAYTON ARTICLE IV ON EX-YUGOSLAVIA ARMS
CONTROL--REVIEW CONFERENCE GOES SMOOTHLY

Classified By: Chief Arms Control Delegate Hugh Neighbour,
for reasons 1.4(b) and (d).


1. (SBU) Summary: The Sixth Review Conference for Dayton
Article IV implementation was held in Vienna on 3-4 July

2008. The conference went very smoothly -- there were no
contentious issues between Bosnia, Croatia, Serbia and
Montenegro. Indeed, the main area of discussion centered on
ways the Parties would take on increased "ownership" of the
agreement, while retaining involvement of the broader
international community. All avoided the issue of Kosovo.
Meanwhile, the CiO,s Personal Representative (PR),Italian
Brigadier General Periotto, will address the OSCE Permanent
Council on September 25 regarding Dayton activities. USDel
recommends that that U.S. express strong support for his
position and for the leadership he has shown. The next
"Article IV Sub-Regional Consultative Commission" meeting
will be 15-16 October in Montenegro. End summary.


Sixth Review Conference


2. (SBU) The "Sixth Conference to Review the Implementation
of the Agreement on Sub-Regional Arms Control" was held in
Vienna, 3-4 July. The Review Conference began with a three
hour preparatory committee the day before, in which the
majority of the work on the final document was hammered out
in advance between the parties themselves, Bosnia, Croatia,
Serbia and Montenegro. They did this without the presence of
the Contact Group (CG),i.e., Britain, France, Germany,
Italy, Russia, U.S.


3. (SBU) The Review Conference concluded after a brief final
session on 4 July, which followed an opening dinner on 2 July
and a three-hour session on 3 July. There were no
contentious issues and only a few areas of significant
discussion.


Moving Towards Local "Ownership": Only Questions Pace, Depth


4. (SBU) The main area of open-ended discussion and
"brainstorming" during the Review Conference concerned the
pace, depth, and definition of steps to be taken by the
Parties to assume greater "autonomy" within the Article IV
process. The PR, Italian Brigadier General Periotto, in his
opening statement, called for eventual "full and final"
transfer of ownership to the Parties. (Comment: USOSCE had
been working with both PR and CG to encourage such a
statement from the PR. End comment).


5. (SBU) All four of the Parties responded in statements that
they also wanted to work towards more responsibility.
Bosnia-Herzegovina and Serbia edged to a more moderate pace
of such transfer of autonomy, with continued involvement and
supervision of the PR and the International Community.


6. (SBU) Croatia edged to a more aggressive transfer of
autonomy. The Croatian Head of Delegation, Sanja
Bujas-Jaraga told U.S. reps on the margins that Croatia was
interested in removing the concept of "supervision" of
Article IV implementation, in favor of "partnership" between
the Parties and the PR. After Bujas-Jaraga's intervention,
the Croatian Head of Verification emphasized to US reps that
he would like to see continued International Community
participation in inspections in order to provide "witnesses"
to any problems. A transition from Assistants to Observers,
or guest inspectors, could take place. Regardless, all
Parties agreed to consider specific ways to assume increased
autonomy, or "ownership" of the Agreement.


7. (SBU) The Final Document of the Sixth Review Conference
included language that expressed that the Parties will
"explore the modalities for further strengthening of their

USOSCE 00000204 002 OF 004


ownership over the implementation of the Agreement for the
purpose of gradual achievement of full autonomy in its
implemen-tation". Bosnia-Herzegovina perhaps best espoused
the additional benefits of this process when it stated during
an intervention that "ownership gives new incentives; it
makes us energetic and attentive to increase cooperation and
collaboration with one another in developing new ideas."


Euro-Atlantic vs. European


8. (SBU) A short disagreement concerned whether Parties
should substitute "European" for the oft-used term
"Euro-Atlantic" in the final document. All Parties committed
themselves to increased integration to "the West", but Serbia
objected to the term "Euro-Atlantic" as essentially meaning
NATO, while "European" would make clear that integration into
the European Union was the main goal. Croatia led the
successful charge to maintain the term "Euro-Atlantic",
arguing that it was inclusive of aspirations to join NATO
and/or the EU.


Amendment to Article IV to Include Montenegro


9. (SBU) The Parties expressed their satisfaction that,
during the period after the V Review Con-ference, Montenegro
became a Party to the Agreement in accordance with the
Deci-sion as of 16 January 2007. The Final Document notes
that the process of involvement of Montenegro into the work
of all activities has "been achieved due to full political
will and readiness of Montenegro to participate in the
implementation of the Agreement." However, the Amendment to
Article IV to formally incorporate Montenegro was NOT signed
during the Review Conference due to Serbia's lack of
government. Serbia did, however, agree in principle and
resolved to sign during the next Sub-Regional Consultative
Commission meeting, 15-16 October 2008, in Montenegro.


Issues for Future Discussion and Solution


10. (SBU) In addition to "autonomy transfer," several other
issues were discussed during the conference and included in
the Final Document under issues requiring "further
discussion." These include:

-- Finalizing the procedures for issuing the Statements on
voluntary limitations on military manpower;
-- Considering the issue of the minimum number of quotas
ensuring a stable inspection regime;
-- Considering initiatives to simplify existing allowable
procedures for equipment reduction;
-- Finalizing the process of development of a handbook for
implementation of the Agreement on Sub-regional Arms Control;
and
-- Expressing their readiness to initiate an exchange of
opinions with regard to considering the Adapted CFE treaty as
a possible suitable long-term alternative to the Article IV
Agreement. (Note: Several of the Parties went even further
in their support to strongly consider eventual accession to
the Adapted CFE Treaty, assuming an eventual entry into
force. End note.)


U.S. Succeeds at Keeping Kosovo Out; Russia Blocks CG
Statement


11. (C) Russia did not make an intervention during the Review
Conference, keeping the agreement among Contact Group (CG)
members not to "break silence" on the Kosovo issue.
Similarly, the Parties themselves avoided the issue.


12. (C) In the days and weeks before the Conference, at the

USOSCE 00000204 003 OF 004


request of the PR, the CG worked on a German draft CG
Statement for the Sixth Review Conference. The German draft
contained support for the Personal Representative, the
Parties, implementation successes, and the transfer of
ownership to the Parties themselves.


13. (C) However, on "very firm" instructions from Moscow,
Russia (Balakin) prevented a joint statement by the CG
through its insistence that any CG statement include a
reference that would imply that Kosovo is part of Serbia.
Russia insisted on inserting a "clear and unambiguous
reference" stating that the Article IV Area of Application
(currently Serbia, Montenegro, Croatia and
Bosnia-Herzegovina) includes the territory of Kosovo.
Periotto believed that such a statement, or even a
German-proposed alternative that would allow for
"constructive ambiguity" would be counter-productive because
all of the Parties' were interested, at least for now, in
avoiding the political issue in Article IV. After strong
U.S. objection for any reference to Kosovo, the PR requested
the draft CG statement be rescinded.


Staffing Changes for Article IV


14. (SBU) Periotto will lose three very experienced staff
members, all secondees, two of which are rotators, this
summer: Retired German Lt. Colonel Helmut Kruse with over 10
years experience and German Major Joern Wiederholz, who moves
to the NATO International Staff, and his Personal Assistant,
Italian Major Gabriele DeFeo.


15. (C) During a private lunch with U.S. rep Claus, Periotto
outlined his plan for the future. He intends to continue to
keep the international community (IC) involved and has
confirmed the interest of the Parties to continue
participation of the IC. Periotto has rejected his
predecessor,s proposal to downsize the rank of the PR or to
move his office to the CPC. He plans to remove one of two
German operations officer, secondee slots and will replace
DeFeo with an Italian Lt. Colonel who is already selected.
He completely understands the U.S. interest in saving money
within the Secretariat and is willing to work with the U.S.


16. (SBU) On 24 July, the U.S. delegation hosted a luncheon
for the members of the CG and Periotto and his staff, three
of which are departing this summer. The U.S. took the
opportunity to thank General Periotto for his leadership and
forward-leaning ideas to transfer additional autonomy to the
Article IV states. The General and CG members bid farewell
to U.S. representative Jon Claus, the only member of the
current CG leaving before the next Sub-Regional Consultative
Commission. The remaining members, as well as U.S.
co-representative, LTC Alan Hester, will next meet in
Montenegro, during the next meeting of the Sub-Regional
Consultative Commission, 15-16 October 2008.


Montenegro and Kosovo


17. (C) During the lunch with Claus, Periotto shared his
assessment on the potential for Montenegrin recognition of
Kosovo. After early July discussions with the Head of
Mission in Pristina (Amb. Badescu) and Montenegrin military
leadership, including the CHOD),Periotto believes that
Montenegro already has made the decision to recognize
Kosovo,s UDI, and could do so as early as in mid-August.
Amb. Badescu was worried about the impact of this. When
questioned, he did not attribute this assessment to any one
representative, but from different conversations.


18. (C) According to Periotto, the Serbian Military Advisor
to the OSCE, Lt. General Zaric, has told him that the Serbian
reaction to this act will be "180 degrees" different from

USOSCE 00000204 004 OF 004


Serbia,s reaction to Croatian recognition of Kosovo because
Montenegro is Serbia's "little brother." This could impact
the signing of the Article IV amendments and implementation
of Article IV. Additionally, Montenegro will provide its
first military advisor to the OSCE soon - Lt. General
Martinovic, who will be the same rank as the Serbian Military
Advisor.


Good News on INA Formats


19. (SBU) Article IV staffer Wiederholz informed U.S. reps
that the INA formats for Dayton were completed by the
contractor way under budget. The estimate for the work was
originally 70,000 euros, while only 30,000 was allocated.
U.S. rep Claus reviewed the formats for accuracy. They will
be provided to the Communications Group at its next meeting
for approval and subsequent use by the Parties. (Comment:
German Major Wiederholz deserves the credit for pushing for
completion of this project. End comment.)


Support for CiO's Rep in the PC


20. (SBU) Periotto will address the OSCE Permanent Council on
25 September regarding Dayton activities. Periotto is the
most pro-U.S. PR so far and has been willing to listen to
U.S. reps and implement their suggestions at every
opportunity. USDel recommends that U.S. express strong
support for his position and for the leadership he has shown
on this occasion.
FINLEY