Identifier
Created
Classification
Origin
09PODGORICA35
2009-02-06 14:11:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Podgorica
Cable title:  

SCENESETTER FOR GENERAL LIBBY VISIT TO MONTENEGRO

Tags:  PREL PGOV MW 
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DE RUEHPOD #0035/01 0371411
ZNR UUUUU ZZH
P 061411Z FEB 09
FM AMEMBASSY PODGORICA
INFO RUEKJCS/SECDEF WASHDC
RUEHC/SECSTATE WASHDC PRIORITY 1148
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHPOD/AMEMBASSY PODGORICA 1236
UNCLAS SECTION 01 OF 04 PODGORICA 000035 

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E.O. 12958: N/A
TAGS: PREL PGOV MW
SUBJECT: SCENESETTER FOR GENERAL LIBBY VISIT TO MONTENEGRO

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UNCLAS SECTION 01 OF 04 PODGORICA 000035

SENSITIVE
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E.O. 12958: N/A
TAGS: PREL PGOV MW
SUBJECT: SCENESETTER FOR GENERAL LIBBY VISIT TO MONTENEGRO

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1. (SBU) SUMMARY: Welcome to Montenegro. Your visit comes as
the Montenegrin leadership continues its pro-NATO, pro-western
stance, having recognized neighboring Kosovo in October 2008 and
formally applied for EU membership in December 2008. The
Government of Montenegro (GoM) remains a receptive interlocutor,
eager to develop strong ties with Washington and to prove itself
a reliable partner. The GoM also continues preparing for its
goal of eventual NATO membership by pursuing the Intensified
Dialogue with NATO begun in 2008, working to increase public
support for NATO membership, and lobbying for a Membership
Action Plan (MAP) invitation at the 2009 NATO summit. The GoM is
making continued contributions to peacekeeping operations,
including plans to deploy its own military units to ISAF.
However, major decisions requiring legislative approval will be
delayed until after parliamentary elections, scheduled for March

29. The economy has been fueled heavily by FDI in the tourism
sector, but faces slower growth in 2009 due to the global
economic crisis. END SUMMARY





NATO Membership a Top GoM Priority

--------------




2. (SBU) Following independence, the Ministry of Defense (MoD)
-- led by Minister of Defense Boro Vucinic -- has built its
organization from the ground up. Developing its human resource
capacity is proving to be a major challenge. Other challenges
include prioritizing requirements, building the legal and
regulatory framework for its volunteer force, and establishing a
functioning procurement system.




3. (SBU) The Montenegrin Armed Forces are led by Chief of
Defense Admiral Dragan Samardzic. Montenegro inherited an
outdated, ill-equipped military that is still working to
organize itself as a modern, NATO-interoperable force capable of
contributing to force projection and peacekeeping operations.
The latest Montenegrin Strategic Defense Review (SDR) calls for
a 2,400-person force (plus 300 reservists) structure under a
combined service of naval, ground, and air assets. Their goal is
a combat capable, fully professional force which serves their
nation not only in operations outside its borders, but also is
capable of homeland defense, assisting the Ministry of Interior
in crisis management.




4. (SBU) Montenegro continues to make forward progress in
establishing its nascent defense institutions and future
military structure. The GoM has stated that NATO Membership is
a strategic goal for the nation. Montenegro was invited to
Intensified Political Dialogue at the NATO Bucharest Summit in
April 2008. GoM officials are hopeful an invitation to the
Membership Action Plan (MAP) will be forthcoming at the NATO
summit this spring.




5. (SBU) Montenegro's progress toward NATO was validated by a
NATO assessment team, which last month gave the GoM high marks
for its reforms to date, particularly in the defense sector. The
MoD touts its potential niche capabilities in the areas of naval
salvage and recovery operations, a regional demining diving
center, mountain infantry, military medical teams, and
potentially a regional helicopter training center.




6. (SBU) In June 2008, Montenegro completed the destruction of
1,500 Strela Man Portable Air Defense Systems (MANPADs) under a
two million dollar USG demilitarization program. This was an
important contribution in support of the WOT, and we are
continuing the program to encompass the destruction of more than
2,000 sea mines, rockets, and other outdated arms and
ammunition. Additionally, Montenegro officially donated more
than 1,500 small arms weapons and 200,000 rounds of ammunition
to the Government of Afghanistan in September 2007. In December
2007, the GoM signed a Transit Agreement with NATO to facilitate
the use of its territory to reinforce KFOR in the event reserves
are needed in Kosovo. As a result of the recent PARP
assessment, Montenegro may have additional items to donate or
sell that are now considered surplus.



PODGORICA 00000035 002.2 OF 004




7. (SBU) Montenegro signed an Article 98 Agreement with the U.S.
and has stated its intention to contribute military units to
support NATO operations in Afghanistan. A three-man medical
team will deploy in August as part of a larger contingent from
the region. MoD has said privately it plans to deploy an
infantry platoon to the International Security Assistance Force
(ISAF) operations in late 2009.




8. (SBU) The MoD has been negotiating with private firms to
assist in preparing their infantry company for deployments in
support of ISAF this year. It will look to the Maine National
Guard for additional training in support of this deployment and
future NATO activities.




9. (SBU) Vice-Admiral Samardzic visited Joint Forces Command -
Naples (JFC Naples) February 1-2, 2009. Admiral Fitzgerald
committed to a U.S. ship visit in April. As part of this ship
visit, Montenegro will have crew on the ship for two weeks
through the Sea Rider program. Samardzic committed Montenegro
to providing a liaison officer (LNO) by June 2009 as an active
PfP member and as part of the JFC Naples staff.





GoM Decision to Recognize Kosovo

--------------




10. (SBU) In possibly its biggest foreign policy decision since
independence, the GoM announced Montenegro's recognition of
Kosovo as an independent country in October 2008. The GoM faced
fierce opposition to this decision domestically (32 percent of
the population consider themselves Serbs) and from the
Government of Serbia. The establishment of full diplomatic
relations with Pristina continues to be a delicate political
issue for the GoM.





Stable Political Situation, But Elections in March

-------------- --------------




11. (SBU) Almost three years after the split from Serbia, no
major political parties actively question Montenegro's
independence. The May 2006 referendum and subsequent September
2006 parliamentary and April 2008 presidential contests met
international standards for free and fair elections. In October
2007, Montenegro adopted a new Constitution through democratic
debate.




12. (SBU) In late January, at the request of the GoM, Parliament
voted to curtail its mandate. President Vujanovic then set
March 29 as the date for election of a new parliament (ahead of
the regular election scheduled for late 2009). The election
campaign will be in its early stages at the time of your visit
and is likely to delay major political decisions until later in
the year. The ruling Democratic Party of Socialists (DPS) -
Social Democratic Party (SDP) coalition is the heavy favorite to
return to power.




13. (SBU) Montenegro signed a Stabilization and Association
Agreement (SAA) with the European Union in October 2007, and
formally applied for candidate status in December 2008.
Montenegro is a member of the United Nations (UN),Organization
for Security and Coordination in Europe (OSCE),and the Council
of Europe. It has been a constructive regional player, building
good relations with neighbors and participating in numerous
regional initiatives (such as CEFTA, SECI, and the Stability
Pact).




14. (SBU) President of the ruling Democratic Party of Socialists

PODGORICA 00000035 003.2 OF 004


(DPS) Milo Djukanovic, who led Montenegro from the
reintroduction of multi-party democracy in 1991 to independence
in 2006, declined to seek reappointment as Prime Minister after
his party won the September 2006 parliamentary election.
Djukanovic returned to office as PM in February 2008, when
previous PM Sturanovic resigned for health reasons. Prime
Minister Djukanovic has stated repeatedly that his government's
primary foreign policy goals are EU and NATO membership, and he
speaks candidly about the U.S. as Montenegro's "strategic
partner."




15. (SBU) Domestically, the GoM's track record on fully
implementing needed democratic and economic reforms is generally
positive, with room for improvement (particularly in
strengthening the rule of law). Privatization of remaining
infrastructure (airports, railroad, and the port of Bar) and the
energy sector has been slow, as the smaller coalition partner,
the Social Democratic Party (SDP),is hesitant to cede state
control in these sectors. Though the DPS and SDP have differing
opinions on the state's role in strategic industries, they have
put them aside and agreed to run again as a coalition in the
parliamentary election this March.




16. (SBU) The opposition is fractious and to date has been
ineffective in presenting a serious challenge to the DPS.
Several opposition parties are currently discussing the
possibility of cooperating in the March elections. Most
opposition parties either oppose or straddle the fence on the
issue of NATO membership for Montenegro. Almost all, however,
are in favor of EU membership.





Fighting Corruption

--------------




17. (SBU) As in other southeastern European countries,
corruption exists at all levels of government and society. Many
Montenegrin citizens list corruption as the country's biggest
problem (along with low living standards). The GoM has
published an Action Plan for fighting corruption, and issues
semiannual reports on its progress, but successful prosecutions
and punishment are still rare.





Attracting Investment

--------------




18. (U) Montenegro has been successful in attracting significant
foreign direct investment (FDI),though so far little of that
has been from the U.S. The economy continues to expand, fueled
by a boom in coastal tourism and investment. In the last two
years, the GoM has tamed inflation, moved closer to WTO
membership, privatized almost 90 percent of the economy, and
successfully created a generally business-friendly environment
which has produced the highest per capita rate of FDI in the
region. The country established the lowest corporate tax rate in
the region (nine percent) and dramatically improved its tax
policy. Tourism and tourism-related investments, particularly
along the Adriatic coast, are booming, and the independent World
Travel and Tourism Council has ranked Montenegro as the
top-growing tourism destination in the world.




19. (SBU) Montenegro currently is entering the largest
investment cycle in its history as the GoM plans tenders
totaling between 15 and 20 billion euros in infrastructure,
tourism, energy, and the privatization of the remaining
state-owned companies over the next two years. Eager to change
the impression that only Russians are investing in Montenegro,
the GOM is carrying out an aggressive "invest in Montenegro"
campaign around the world, including in the United States.




PODGORICA 00000035 004.2 OF 004



20. (U) Despite impressive recent trends, the global economic
crisis will not completely bypass Montenegro. The country's GDP
growth of the past two years - seven percent in 2007 and eight
percent in 2008 - is likely to slow considerably in 2009, with
the IMF and World Bank estimating that it will fall to roughly
two percent.
MOORE