AMBASSADOR OBSITNIK'S FAREWELL TRIFECTA - FICO,

C O N F I D E N T I A L BRATISLAVA 000053

SIPDIS

FOR EUR/CE LLOCHMAN, KERTAS, JLAMORE

E.O. 12958: DECL: 01/29/2019
TAGS: PREL ENRG PGOV LO
SUBJECT: AMBASSADOR OBSITNIK'S FAREWELL TRIFECTA - FICO,
GASPAROVIC AND KUBIS

Classified By: Charge Keith A. Eddins, for reasons 1.4 (b and d)


1. (C) Summary: In farewell calls on Prime Minister Fico,
President Gasparovic, and Foreign Minister Kubis, Ambassador
Obsitnik underscored his appreciation for U.S.-Slovak
cooperation during his 13-month tenure, highlighting
Slovakia's entry into the Visa Waiver Program and
increasingly active engagement in Afghanistan. At the same
time, he urged the Slovaks to resist the temptation to
respond to the global financial crisis in ways that would
threaten their investment-friendly business climate.
Ambassador Obsitnik also encouraged the Slovaks to pursue an
active pro-transparency/anti-corruption program to counter
the widespread perception that the government plays favorites
and rewards supporters in, for example, the awarding of state
contracts.


2. (C) Because these meetings took place in the midst of the
Russia-Ukraine natural gas dispute, the Ambassador's Slovak
interlocutors were focused on the energy crisis in Slovakia.
Fico and Kubis were quite critical of both Moscow and Kyiv,
although Kubis was particularly scathing in his description
of Ukraine's disingenuous (in his view) agreement to a gas
"swap" that never materialized. All three expressed pride in
Slovakia's adoption of the Euro, and voiced hope that being
part of the Euro zone would help the country weather the
ongoing global recession. Fico put much of the blame for the
perception that Slovak society is corrupt on the local media,
although he also voiced a willingness to bring ABA/CEELI back
to the country to reprise some of the judicial reform
programs that had existed here prior to EU accession. End
Summary.

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Departing Thoughts and Concerns
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3. (C) Ambassador Obsitnik paid farewell calls on Slovak
President Ivan Gasparovic (January 14),and Prime Minister
Robert Fico and Foreign Minister Jan Kubis (both on January
19). The Ambassador took the opportunity to review his 13
months at post, expressing his appreciation for Slovakia,s
growing engagement in Afghanistan and pointing with pride to
Slovakia,s entry into the Visa Waiver Program, President
Gasparovic,s October 2007 visit to Washington to meet with
then-President Bush, and then-DHS Secretary Cherthoff,s
visit to Bratislava. While acknowledging that our countries
do not agree on every major question (e.g., missile defense,
recognition of Kosovo),he underscored our close and
effective work together on a range of issues.


4. (C) At the same time, the Ambassador, citing his
experience as a former businessman, expressed concern that
some policies the Fico government has adopted might damage
the perception that Slovakia welcomes foreign investment. In
addressing the global economic crisis, he continued,
governments need to be careful. He noted, for example, the
Slovak government's effort to limit the price increases
energy monopoly SPP could pass along to consumers. He also
cited the difficulty the U.S. firm Aspect Energy was having
in securing permission to drill for natural gas in Slovakia;
the complex and often opaque regulatory system seemed to be
counterproductive given the then-ongoing natural gas crisis.
The Ambassador also urged his hosts to confront the
widespread perception of official corruption in Slovakia,
which could easily dampen economic growth and scare away
potential investors.

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Natural Gas Crisis
--------------


5. (C) The shut-down of natural gas deliveries to Slovakia
due to the Russian-Ukrainian contract dispute was the most
immediate concern of each of his interlocutors. Gasparovic,
with whom the Ambassador met at the nadir of the situation,
voiced concerns that personal animosities between the
Ukrainian president and prime minister were making the
situation worse, while noting that he had written both
President Medvedev and President Yushchenko to remind them
that they had contractual obligations to fulfill and that
Slovakia did not deserve to be treated as a political pawn.


6. (C) By the time the Ambassador met with Fico, the final
Russian-Ukrainian deal had been struck and gas was beginning
to flow again. Fico was critical of both the Russians and
the Ukrainians, not simply for causing the overall crisis but
also for not implementing the "swap" that Fico had negotiated
during his trip to Moscow and Kyiv on January 15. He was
also quite harsh in his comments about the EU, citing its

inability to solve the problem or protect its most vulnerable
members. At the same time, he expressed appreciation of EU
partners Germany and the Czech Republic for their willingness
to help bring gas from northern Europe to Slovakia. Fico
agreed with the Ambassador on the need for Slovakia to
diversify its energy suppliers and raised the Nabucco
pipeline as an alternative the Slovaks needed to consider
more seriously. He also reiterated Slovakia,s determination
to build additional nuclear reactors, which he said would use
western, not Russian, technology. The Ambassador took
advantage of this opening to highlight Westinghouse's
capabilities, particularly in cooperation with CEZ (the Czech
power company with whom the Slovaks are working).


7. (C) Kubis was the most scathing in his criticism of the
Ukrainians. While acknowledging that both Russia and Ukraine
were responsible for the fundamental dispute, Kubis was
"bitter" about what he considered to be Kyiv,s disingenuous
agreement to the "swap" of gas reserves. An angry Kubis said
that Ukraine had missed an opportunity to demonstrate its
appreciation to a "good neighbor" who had always been
supportive of Ukraine in other areas. Kubis asserted the
Ukrainians knew the "swap" would not have been harmful to
their negotiating position, but nevertheless failed to "help
a friend in its moment of need." This duplicity, Kubis
concluded, "will be remembered" and Slovakia "will think
twice before helping them" in the future. (Comment: We were
somewhat surprised at the depth of Kubis,s rancor toward
Kyiv, which may stem in part from the fact that Slovakia - as
NATO contact nation for Ukraine - has played a more
high-profile role than it is normally comfortable with in
supporting a policy that is anathema to Moscow. End
Comment.)


8. (C) While not as harsh in his characterization of Moscow,
Kubis opined that Slovak citizens were looking more
negatively toward the Russians. He said the gas crisis had
been an eye-opening event that should encourage all Europeans
to be more realistic about Moscow and get serious about
energy independence. Like Fico, he raised Nabucco without
prompting, suggesting that people would be giving it a more
serious look in the wake of the Russian-Ukrainian standoff.
He also expressed support for nuclear energy and the
increased use of liquefied natural gas, and agreed with the
Ambassador that Aspect Energy's desire to drill in Slovakia
should be pursued. Finally, he thanked the Ambassador for
U.S. efforts to encourage the "swap," even if they produced
no immediate results.

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NATO and Afghanistan
--------------


9. (C) Fico was positive -- albeit without offering anything
specific -- about Slovakia's continued role in Afghanistan.
Responding to the Ambassador's query about potential
increases in troop strength and an expanded, more robust
mandate, Fico acknowledged that the U.S. and the Slovak MOD
were working on options for cooperation and said he wanted
that work to succeed. He also noted that of all Slovakia's
foreign deployments, Afghanistan was the most important
because it took place within NATO. Gasparovic was also
supportive of continued Slovak efforts in Afghanistan,
averring that "Slovakia has responsibilities and we will
honor them." On Ukraine's potential membership in NATO,
Gasparovic was generally supportive and rejected Moscow's
efforts to derail Kyiv's plans, although he noted that the
gas crisis had demonstrated that Ukraine still had a long way
to go both economically and politically before it was ready
to join either the Alliance or the EU. Fico was less
enthusiastic, noting that the gas crisis had revealed that
Ukraine was not a particularly strong partner.

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Euro Adoption, the Global Economy, and Corruption
-------------- --------------


10. (C) The Prime Minister was clearly proud that Slovakia
had seamlessly introduced the Euro on January 1. He boasted
that no other country had adopted the Euro in the midst of
anything as difficult as the gas crisis, and pledged that he
would keep to his promise that Euro introduction would not
lead to an increase in the inflation rate. Gasparovic was
similarly proud, citing the envy toward Slovakia that several
other Central European leaders had publicly expressed at a
recent gala celebration of the Euro's introduction. Both
Fico and Gasparovic expressed the expectation that the Euro
would help Slovakia weather the global economic crisis. Fico
explained that even in the face of a global recession, his
government's priorities remained maintaining Slovakia's

social welfare programs and ensuring continuing growth of the
economy.


11. (C) Fico noted the success of the Slovak economy over
the past decade, but pointed particularly to progress made
since his government took office. He cited not only economic
growth and the adoption of the Euro, but also entry into the
EU's Schengen zone and U.S. Visa Waiver Program. What, he
asked rhetorically, could the media criticize? Answering his
own question, he launched into an explanation of how the only
issue on which the Slovak press could attack the government
was corruption and clientism. According to Fico, allegations
of irregularities in public tenders or other forms of
corruption simply represented the media's need to have
something shocking to report. When the Ambassador pointed
to an Embassy-supported anti-corruption program in Martin,
Fico acknowledged the value of such local efforts. He even
harked back to ABA/CEELI's judicial reform and
anti-corruption efforts of the late 1990s and early 2000s as
worth of reprise; as discussed septel, these programs ended
following EU accession, but we will be following up on Fico's
suggestion of reviving some form of relationship with
ABA/CEELI.

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The Future
--------------


12. (C) Both Fico and Gasparovic expressed their willingness
to cooperate closely with the new administration in the U.S.;
both have sent congratulatory letters to President Obama.
Gasparovic, who is up for reelection this spring, said that
if he wins a new term, he intends to focus on helping Roma
and improving Slovak-Hungarian relations, although he added
that the latter will require equal willingness on the part of
the Hungarians. Fico's musings on the future included a
comment that he wasn't sure that he would even stand for
reelection in 2010, although this likely had more to do with
his suffering from a sore back and having just experienced
the gas crisis than providing any well-thought-out peek at
his real intentions. When asked which of the two would
represent Slovakia at the April NATO Summit - and thus have
the first chance to meet President Obama - Fico said he
thought it would be Gasparovic; since the summit comes
between the two rounds of the Slovak presidential election,
Gasparovic would thus get an electoral boost from attending.

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


13. (C) Fico, as he regularly demonstrates in high-level
meetings, knows how to turn on the charm and direct the
conversation. His response to the Ambassador's comments
regarding corruption -- "it's the press!" -- were completely
in character, seeking to obfuscate the reality that there are
much more serious problems with Fico's governance than
occasional cronyism or favoritism. The recent decision by
former Slovak Ambassador to the U.S. Martin Butora to
publicly reject an award given by the Slovak Atlantic
Commission because his co-recipient was Interior Minister
Kalinak is indicative of the depth of concern among those who
struggled to foster democracy here. Many simply do not want
to be associated in even the most benign way with the ruling
elite.


14. (C) We have often heard from his confidants that Fico is
interested in working more closely with the new U.S.
Administration. We will watch closely to see whether his
rhetoric and actions support that assertion. In the
meantime, we are considering if and how we may want to
recalibrate our day-to-day approach toward the GOS - mindful
that Slovakia is a NATO ally and an EU member - to better
promote U.S. interests with government officials who too
often seem more interested in what the state can do for them
than in what they can do for the state.
EDDINS