SWEDES ON EU-RUSSIA SUMMIT NOVEMBER 18

C O N F I D E N T I A L SECTION 01 OF 02 STOCKHOLM 000720

SIPDIS

E.O. 12958: DECL: 11/16/2019
TAGS: PREL PGOV EUN RU SW
SUBJECT: SWEDES ON EU-RUSSIA SUMMIT NOVEMBER 18

Classified By: Acting PolCouns Briana Olsen for reasons 1.4 (B) & (D).


1. (C) Summary: Poloffs on November 6 met with Swedish MFA
Deputy Director for Eastern Europe and Central Asia Tobias
Thyberg to discuss the November 18 EU-Russian Summit in
Stockholm. The summit agenda will focus on climate change,
the financial crisis, and energy issues. Leaders are also
expected to discuss European security, but only as part of a
broader discussion on international issues and without
reference to Medvedev's security proposal. Sweden expects
modest results on classified information sharing, and would
like a forward-leaning statement on cooperation in crisis
management, and progress on auditing procedures of funding
for cross border cooperation. Thyberg debunked speculations
that Sweden's decision to approve permits for the
construction of Nord Stream was used to influence Russia
ahead of the Summit. However, Russia agreed to a bilateral
dinner a few days after the approval.

Summit Agenda
--------------


2. (C) Thyberg told poloffs that the summit plenary agenda
will cover climate change, the financial crisis (both topics
suggested by Sweden),and energy issues (suggested by
Russia). Discussion of EU-Russia relations will occur within
the framework of the four policy areas or "common spaces"
(economics and environment; freedom, security, and justice;
external security; and research and education, including
cultural aspects) and the Partnership and Cooperation
Agreement (PCA). Thyberg remarked that the framework for
EU-Russia discussions is very formalized, leaving the Swedes
little room for influence. There will be an Industrialist
Roundtable, a business forum of 10-15 persons in total with
the purpose of making recommendations on business
cooperation. The Russian side will be headed by Anatoly
Chubais, Director General of Rusnano, a state-owned Russian
nanotechnology company, and Maersk Mc-Kinney Moller, the
sealine shipping magnate from Denmark, who will head the EU
delegation. Medvedev will meet with the Swedish king for 30
minutes. According to Thyberg, the visit with the King
allows the Swedes to give Medvedev's visit a bilateral
appearance, without having an actual political bilateral.
However, a few days after Thyberg made the comment, the
Russians agreed to the bilateral because, according to the
Russian Desk, Sweden approved the Nord Stream permits.

International Issues
--------------


3. (C) The Swedes suggested to discuss international issues,
such as Afghanistan and Pakistan, Iran, and the Caucasus
region during lunch, but Russia proposed eight other issues
in response, including Russian President Medevedev's European
security treaty proposal.
Thyberg emphasized that Sweden will not discuss Russian
security proposals outside the OSCE Corfu process, but
Stockholm agreed to address general European security issues,
without reference to Medvedev's proposal or Corfu, under the
general heading of "international issues." Thyberg said
Sweden is willing to listen to the Russians on European
security, but will not engage on the issue.

Joint Crisis Management Operations
--------------


4. (C) Thyberg expects the parties to sign an agreement on
classified information sharing that will be a prerequisite
for better coordination during crisis management operations.
Thyberg said that the Swedes would like to see a "positive,
forward leaning statement on a broad framework for
cooperation and crisis management." He highlighted the EU
and Russia,s positive experiences of cooperation in Chad,
where Russia assisted with airlift, and Operation Atalanta.
But the EU's Civil Criteria directive prevents EU missions
from operating under non-EU command or even shared command,
which complicates cooperation. Thyberg, however, assessed
that there is some momentum on finding a solution, noting
signals from Moscow that it is willing to think creatively on
this issue.

Cross Border Cooperation
--------------


5. (C) Sweden is also in the process of negotiating an
agreement on Cross Border Cooperation (CBC) programs and
auditing procedures. Russia, a major past beneficiary of CBC
funds, has for the first time decided to contribute EUR 1.2
billion ($1.8 billion)--a "big political signal" according to
Thyberg. EU auditors in the past were able to audit how EU
money was spent, including inside Russia, but Russia's
announcement of its intention to contribute monetarily raises
questions whether Russian auditors will also be allowed to

STOCKHOLM 00000720 002 OF 002


follow the money trail into EU member states. Moscow is
pushing for reciprocity in this area, but while Sweden views
the reciprocity of auditing procedures as primarily a legal
question, the issue is of political consequence for countries
like Poland, Estonia, and Lithuania, who do not want Russian
auditors "snooping around."

Energy Supplies
--------------


6. (C) The Swedes are likely to seek political guarantees on
the part of Russia to avoid a repeat gas crisis in addition
to an agreement on the establishment of an early warning
mechanism to prevent interruption of Russian fossil fuel
supplies. According to a note from the Swedish EU Presidency
discussed at the Political and Security Committee on 10
November in Brussels, the EU will ask Medvedev for "clear,
political assurances" from Moscow that there will be no
further cuts or reductions in gas and oil supplies towards
the 27 EU Member States, independently of any conflicts that
might arise in the future between Russia and third countries,
such as Ukraine. Moreover, the EU will, once more, express
regret over Russia's withdrawal from the Energy Charter
Treaty and insist that the basic principles of this treaty
(which has been signed but never ratified by Moscow) be
enshrined in the energy chapter of the new PCA that the EU
and Russia are negotiating. As a possible wildcard, Thyberg
hinted that Moscow may table new ideas, possibly on 17
November, on energy relations as alternatives to the Energy
Charter Treaty.


7. (C) Thyberg also confirmed that on November 1, Prime
Ministers Reinfeldt and Putin spoke on the phone, and that
the only subject of the conversation was Ukraine's deliveries
of Russian gas. According to Thyberg, Reinfeldt reiterated
the EU position that contentious issues surrounding Ukrainian
gas transit are to be resolved between Naftogaz and Gazprom,
and that the EU will not provide financial aid to Kyiv in
order to meet its gas payment obligations. The Swedes assess
that Ukraine will meet its next payment and that neither
Russia nor Ukraine are ready to have another faceoff over gas
at this time.

Nordstream Approval not Linked to Summit
--------------


8. (C) Thyberg was adamant about delinking Sweden's November
5 approval of environmental permits for Nord Stream with the
EU-Russia Summit. He explained that the permit approval
surrounding Nord Stream was handled by the Ministry of
Justice (legal issues) and the Ministry of Environment
(environmental issues). Foreign Minister Carl Bildt has also
strongly and repeatedly stated that the issue is not
political (i.e. does not involve the Ministry of Foreign
Affairs),but for the MOJ and MOE to handle. Thyberg noted
that Sweden would be criticized regardless whether it
approved the permits prior to the announcement of the
EU-Russia Summit or after; in the former scenario it would be
criticized for offering a carrot to the Russians to agree to
hold the summit in Stockholm while in the latter scenario it
would be criticized for rewarding Russia for agreeing to have
the summit in Stockholm. The timing was an unfortunate
coincidence, according to Thyberg. He did state, however,
that the approval removes one of the major thorns in Sweden's
relations with Russia (the other being Bildt, who strongly
criticized Russian actions in Georgia and the Kremlin's
undemocratic moves under Putin, and who has a good, but "love
and hate" relationship with Russian Foreign Minister Lavrov)
and that the MFA is prepared to reap the benefits.


9. (C) Comment: Sweden will aim to make the EU-Russia Summit
productive and successful, possibly making modest progress in
specific areas, but Stockholm is not willing to bend over in
order to have a successful summit. Stockholm,s approach to
dealing with big powers like Russia during the limited
timeframe of the six-month long EU Presidency has been not to
make concessions just for the sake of progress, according to
Thyberg. Overall, Sweden seeks to demonstrate that it can be
a cooperative interlocutor between the EU and Russia and a
pragmatic partner.
BARZUN