US embassy cable - 04HELSINKI1603

C O N F I D E N T I A L SECTION 01 OF 03 HELSINKI 001603 
 
SIPDIS 
 
STATE FOR EUR/RUS, EUR/NB, AND EUR/ERA 
 
E.O. 12958: DECL: 12/29/2014 
TAGS: PREL, ETRD, KNEI, RS, FI, EUN, Finland-Russia 
SUBJECT: FINNS FIND PUTIN "FRUSTRATED, ANXIOUS" 
 
REF: HELSINKI 1221 
 
Classified By: POL Chief John Hall, for reasons 1.4(B) and (D) 
 
Summary 
------- 
 
1. (C) Finnish President Tarja Halonen's most recent meeting 
with Vladimir Putin left the Finns with the clear impression 
that the Russian president is feeling frustrated and anxious. 
 He complained at length to Halonen that Russia has been 
misunderstood and mistreated by the West, with an implicit 
accusation that the U.S. is fostering regime change in the 
near abroad with political cover from the EU.  Former PM 
Paavo Lipponen, after discussing the meeting with Halonen, 
described to the Ambassador his own sense that the Russians 
feel under pressure on their perimeter, at least in the 
Baltic and Caucasus; Lipponen advises that the U.S. and EU 
stand firm on principle, as always, but "bear in mind that 
Putin feels very uncomfortable right now." 
 
2. (C) In contrast to the negative vibrations on 
international issues, Putin was upbeat about cooperation with 
Finland, promising to assist with the regional and bilateral 
issues of greatest interest to the Finns.  This is especially 
important to the GoF domestically, given recent charges by 
local critics that Halonen and the Vanhanen government are 
not capable of managing the relationship with Russia. 
Lipponen in particular was happy with Putin's positive 
response regarding the Northern Dimension, which the GoF 
believes needs some serious restructuring.  End Summary. 
 
The down side: Russia treated poorly by the West 
--------------------------------------------- --- 
 
3. (C) Presidents Halonen and Putin meet roughly once a year 
to discuss bilateral and EU issues.  The most recent meeting 
took place in St. Petersburg on December 14.  We have since 
had read-outs from several different sources here. 
Parliament Speaker (and former PM) Paavo Lipponen discussed 
the summit with Halonen, and passed along his sense of how 
things had gone in a December 17 conversation with the 
Ambassador.  In addition, we spoke with Jarmo Viinanen of 
Halonen's staff and MFA Russia unit director Olli Perheentupa. 
 
4. (C) The meeting, we are told, went well on bilateral 
issues.  Putin did not repeat or refer to recent 
Finland-bashing from officials such as EU advisor 
Yastrzhembskiy, who had claimed that Finland belongs to the 
EU's Russophobe camp.  Halonen was able to raise the 
questions most urgent for the GoF right now (paras 9-12, 
below), and the two presidents together reaffirmed publicly 
that relations are good.  That statement, and the evidence 
that the relationship is operating normally in most areas, 
helps defend Halonen and the government of PM Matti Vanhanen 
against local critics who have charged that Finland's leaders 
don't know how to manage relations with Russia. 
 
5. (C) Our Finnish interlocutors tell us that in the meeting 
itself, Putin seemed (in Viinanen's words) "frustrated, 
stressed, and anxious" -- both about slowness within his own 
bureaucracy and about Russia's relations with the West. 
Putin had declined to set a specific agenda for the 
conversation; instead, he spent much of the time complaining, 
with the general theme that Russia has been misunderstood and 
mistreated. 
 
-- According to Viinanen, Putin had critical words for U.S. 
support of the Saakashvili government in Georgia, which came 
to power "in an illegal way."  Although he spoke 
elliptically, he seemed to imply that the United States was 
actively fostering regime change in Russia's near abroad, 
with the EU providing political cover.  He seemed to include 
Ukraine in this, although he did not dwell on events there. 
 
-- On Chechnya, Putin said he was sick and tired of being 
told there must be a political solution.  He went to great 
lengths to describe what Russia has done to bring about such 
a solution, and said that if he could just find someone with 
whom he could fashion an agreement -- someone who accepted 
that Chechnya will always be a part of Russia -- he would do 
so. 
 
-- Putin sharply criticized the EU's decision to cancel the 
GSP status that had been applied to its aluminum exports. 
This was particularly unjust given that Russia had recently 
signed the Kyoto protocol and extension of the PCA, both 
steps ardently sought by the EU. 
 
-- "He spoke at length on seemingly irrelevant issues," added 
Viinanen.  The Finns had not intended to raise the issue of 
Karelia, but Putin did, saying that if the Finnish/Russian 
border, fixed at the end of World War II, were to be revised, 
then other borders in Eastern Europe could be challenged as 
well. 
 
6. (C) MFA Russia chief Perheentupa commented to us that 
disputes like Russia's GSP status will inevitably mark any 
trade relationship.  Still, he had a sense that "Putin is in 
a state of mind where he can't decide what to do.  He goes 
from one summit to the next, just reacting to the outside 
world, not moving forward according to any strategy or 
vision." 
 
7. (C) Former PM Lipponen (who remains head of Finland's SDP) 
discussed the visit with Halonen and afterward assessed the 
meeting in a conversation with the Ambassador.  Lipponen said 
that the Russians feel under pressure on their perimeter, at 
least in the Baltic and Caucasus areas, and Halonen is 
concerned about what this might portend.  For his own part, 
Lipponen said, his advice to partners on both sides of the 
Atlantic would be to stand firm on principle, as always, but 
"bear in mind that Putin feels very uncomfortable right now," 
especially with regard to Western involvement in the Caucasus. 
 
The up side: regional/bilateral issues 
-------------------------------------- 
 
8. (C) Putin was for the most part upbeat and cooperative on 
the regional and bilateral issues Halonen felt most important 
to Finland: 
 
9. (C) Northern Dimension: Lipponen told the Ambassador that 
he was particularly pleased with the Halonen-Putin discussion 
of the EU's Northern Dimension (ND), toward which the former 
Finnish PM still feels a strong proprietary interest. 
Perheentupa described to us the challenges as the GoF sees 
them.  On the EU side, now that the ND is an official part of 
EU foreign policy all documents related to it are EU 
documents, which makes progress more cumbersome; moreover, 
practically speaking, Finland and Sweden are the only two EU 
nations still interested in the ND.  On the Russian side, 
Moscow has been reluctant to participate in the second action 
plan (which will expire in 2006, during the Finns' EU 
presidency).  A third action plan seems unlikely; instead the 
Finns are casting about for a way to re-define the ND that 
engages more EU states and makes Russia (in Perheentupa's 
words) "an almost equal partner." 
 
10. (C) We are told that Putin readily accepted the idea of 
restructuring.  Hearing that a mid-level Finnish delegation 
would be at the Russian foreign ministry on December 17 for 
further discussions, Putin said he would instruct MFA to be 
responsive.  He was as good as his word: the Finnish 
delegation was received at a higher level than expected and 
found the ministry quite willing to cooperate. 
 
11. (C) Saimaa Canal: This canal, which links the Saimaa lake 
district with the Gulf of Finland, was built a century ago, 
when Finland was a Russian Grand Duchy.  The post-World War 
II boundaries placed most of the canal within the USSR.  In 
1963, Finnish President Kekkonen negotiated a fifty-year 
agreement on Finland's use of the canal to continue maritime 
access to Finland's extensive navigable eastern lake 
district.  At the time, says Perheentupa, it was largely a 
political agreement, but the canal has since become quite 
important to Finnish forestry companies, who need to know 
whether the agreement will be renewed in 2013 so that they 
can plan for alternatives if necessary.  To date little 
negotiating progress has been made, with money being the core 
issue: "We think we should pay according to real costs," said 
Perheentupa dryly.  "The Russians think we should pay as much 
as we can afford."  Halonen raised this with Putin, who said 
that he would speak to the Ministry of Transportation.  The 
current goal is to give the Finnish and Russian Prime 
Ministers a progress report when they have their own next 
meeting, in May or June 2005. 
 
12. (C) Russia, Finland, and the EU: Russia's relations with 
the EU continue to crop up on the bilateral agenda.  The 
Russians have told the Finns repeatedly that they expected 
more sympathy and support from Finland within the EU than 
they have gotten.  In particular, Perheentupa said, Putin has 
the mistaken idea that Finland black-balled Moscow's proposal 
for visa-free travel between Russia and the Schengen area. 
In fact, we are told, the GoF supports gradual visa 
facilitation as a way to move toward eventual lifting of the 
visa requirement.  Finland does not object to that eventual 
goal, as long as the progress toward it is reciprocal. 
 
Looking forward to Finland's EU presidency 
------------------------------------------ 
 
13. (C) According to Perheentupa, Putin reiterated to Halonen 
what the Russians have said repeatedly in recent months: that 
Moscow attaches great hopes to the Finnish EU presidency. 
For their part, our interlocutors say, the Finns are no 
happier with Russians' policies toward the EU than is Putin 
with the EU's policies toward Russia.  To address this, the 
Finns want to intensify the dialogue in preparation for July 
2006, and they expect to be able to do so: "Finland is not a 
great power, like the UK, Germany, or France," commented 
Perheentupa, "but we have long experience in dealing with 
Russia." 
WEISBERG