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### Viewing cable 09HELSINKI211, FINLAND: PM PUTIN SETS CHILLY TONE WITH PM VANHANEN

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
09HELSINKI211 | 2009-06-05 15:54 | 2011-04-24 00:00 | CONFIDENTIAL | Embassy Helsinki

`

    VZCZCXRO1854
    RR RUEHDBU RUEHFL RUEHKW RUEHLA RUEHNP RUEHROV RUEHSR
    DE RUEHHE #0211/01 1561554
    ZNY CCCCC ZZH
    R 051554Z JUN 09
    FM AMEMBASSY HELSINKI
    TO RUEHC/SECSTATE WASHDC 4998
    INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE

` `

    C O N F I D E N T I A L SECTION 01 OF 02 HELSINKI 000211

    SIPDIS

    NSC TO J. HOVENIER

    E.O. 12958: DECL: 06/05/2015
    TAGS: EIND ENRG FI PGOV PREL
    SUBJECT: FINLAND: PM PUTIN SETS CHILLY TONE WITH PM VANHANEN

    REF: 09 HELSINKI 151

    Classified By: Charge d'Affaires Michael A. Butler for reasons 1.4(b) a
    nd (d)

    ¶1. (C) SUMMARY.  Russian Prime Minister Putin set a chillier
    tone in his June 3 visit to Finland than did President
    Medvedev last April.  Finnish officials found Putin less
    cordial and less engaged than Medvedev on the bilateral trade
    matters that dominate high-level Finnish-Russian meetings.
    In his meeting with Prime Minister Vanhanen, Putin placed
    natural gas high on his agenda, first issuing a warning that
    Ukraine's failure to pay up front for gas could create a
    "crisis" later this month, then urging the Finns to quickly
    conclude an environmental assessment of the Nord Stream
    pipeline project.  The Finns could offer no promise of a
    swift and certain resolution to Nord Stream, and they
    received no clarity on their main trade concerns, an increase
    in Russian wood export tariffs and a decision excluding trade
    via road in favor of rail and ship. The overall lighter tone
    of Medvedev's visit over Putin's has not left Finns hopeful
    that resolution of persistent bilateral problems would come
    from the President's office, as Finnish officials consider
    Putin to be in charge.  Finnish officials hope that the
    twice-annual high-level meetings themselves create pressures
    to resolve problems, a hope diminished by Russin policies
    they see having little substance and oherence.   END SUMMARY.
    ¶2. (C) On June 3 RussianPresident Vladimir Putin visited
    Finland where h me with Prime Minister Vanhanen and
    President alonen.  In discussing the Vanhanen-Putin
    meetins, various officials from the Ministry of Foreign
    Affairs said they focused largely on bilateral economic and
    trade matters.  Finnish officials found tone of the
    Putin-Vanhanen meeting less cordial than President Dmitry
    Medvedev's meetings during his first State visit to Finland
    last April (REF). Putin also appeared less prepared than
    Medvedev and was less talkative, leaving other Russian
    officials to address many points.  Finnish media described
    the meetings as "chilly," and one journalist described
    Putin's impatient attitude at a post-meeting press conference
    as "strange."  The atmosphere likely warmed for the
    Putin-Halonen meeting, which lasted well beyond the scheduled
    hour.  (NOTE: Foreign Ministry officials could only
    back-brief on the earlier Vanhanen meeting, not the Halonen
    meeting, which ended at roughly 10 p.m.  Septel on Halonen's
    meeting to follow.  END NOTE.)
    Putin wants Nord Stream decision
    --------------------------------
    ¶3. (C) Though bilateral issues dominated, two wider topics
    arose.  As with Medvedev's visit, the Finns raised the
    question of Russia joining the World Trade Organization, and
    Putin echoed Medvedev's response that Russia had done what it
    could and the matter was in others, hands. Putin raised
    energy and natural gas.  Putin first spoke of Ukraine, saying
    that if Ukraine was unable to meet its obligations Russia
    would require advance payment for gas.  He then gave a
    "strong warning" that there could be a crisis at the end of
    June should Ukraine fail to pay.
    ¶4. (C) The Finns took Putin's underlining of the problem with
    Ukraine as a blunt hint about progress on Nord Stream, the
    proposed natural gas pipeline that would pass through Finnish
    waters.  Turning from Ukraine to Nord Stream, Putin said that
    Russia does not need the pipeline, that it is something
    "Europe" wants.  Nevertheless, he strongly urged the Finns to
    quickly conclude their ongoing environmental assessment.
    Vanhanen replied that the government would follow the
    appropriate environment review process but added they would
    try to have a decision by early October.  (NOTE: Mikko
    Hautala, advisor to Foreign Minister Stubb, told Pol/Econ
    Chief officials expected a decision in favor of the project.
    However, approval would not conclude the Finnish government's
    role, and Nord Stream backers would need to secure a building
    permit in a process that would take them into 2010. END
    NOTE.)  Finnish officials sensed in Putin the irritation of
    other Russian officials who have discussed Nord Stream with
    the Finns, i.e.,  the inability to grasp the Finns, refusal
    to interfere with or supersede a neutral government process.
    Finns frustrated with tariffs and transport
    -------------------------------------------
    ¶5. (C) Vanhanen raised with Putin two issues that Finnish
    officials say exemplify the complete lack of industrial
    policy in Russia.  Vanhanen followed up on the Russians,
    decision last year (following a Vanhanen request to Putin) to
    defer an increase in the roundwood export tariff, which
    threatens an already ailing Finnish wood industry. Putin
    replied that the government would decide the matter in the
    autumn.  Later, Finnish officials greeted with great
    skepticism Putin's assertion in the post-meeting press
    conference that the Russian wood industry had seen
    investments since the government imposed the tariffs.  They
    acknowledge that their wood industry is in dire straits, but

    HELSINKI 00000211  002 OF 002

    they see opportunities in matching Finnish expertise and
    investments with Russian resources.  The officials believe
    the export tariffs have hurt investment in the Russian
    market, something Russian officials fail to grasp.
    ¶6. (C) Vanhanen also raised with Putin his concern about the
    Russian custom authority's decision that in six months trade
    must move via rail or ship, not via road, a decision Finnish
    officials say would be hugely detrimental to their economy
    and that they cannot implement in that time frame.  Putin
    surprised the Finns by justifying the decision on the amount
    of "contraband" passing out of Russia through Finland.
    According to Finnish officials, Finnish-Russian cooperation
    on customs and boarder issues is excellent, and no Russian
    official has pointed to contraband as a concern; they also
    assert the Russian transport ministry does not support the
    custom authority's decision.
    Custody case causes a stir
    --------------------------
    ¶7. (C)  Vanhanen discussed with Putin the custody case of
    five-year-old Anton Salonen.  Salonen's Russian mother took
    him to Russia and his Finnish father sought his return
    through the Russian courts.  Though the father obtained
    official decisions in his favor, border officials prevented
    Salonen's return to Finland and father and son sought support
    from the Finnish consulate in St. Petersburg.  In May a
    Finnish diplomat placed the two Salonens in the truck of his
    car and crossed into Finland.  Finnish officials expressed
    surprise to Pol/Econ chief at Putin's harsh public
    denunciation of the diplomat.  Foreign Minister Stubb
    publicly brushed away the comment, stating that "good
    neighborly relations" include speaking directly about such
    matters.  Putin did not call for the boy's return.
    ¶8. (C) COMMENT.  It appears Putin is more comfortable meeting
    with, and speaking publicly alongside, his former counterpart
    President Halonen than with his current one, Prime Minister
    Vanhanen.  Any frustration exhibited in the Vanhanen meeting,
    perhaps stemming from a lack of movement on long-standing
    bilateral issues like Nord Stream and wood tariffs, and new
    ones like proposed transport restrictions and the Salonen
    custody case (which Putin acknowledged learning about on the
    flight to Helsinki) would not be as strong with Halonen,
    given Putin's long and warm relations with the President.
    The overall lighter tone of Medvedev visit over Putin's has
    not left Finns hopeful that resolution of persistent
    bilateral problems would come from the President's office, as
    Finnish officials consider Putin to be in charge.  Finnish
    officials hope that the twice-annual high-level meetings
    themselves create pressures to resolve problems, a hope
    diminished by Russian policies they see having little
    substance and coherence.  END COMMENT.
    BUTLER

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