Wikileaks - DCCCXL

123934 9/28/2007 11:40 07RIGA731 Embassy Riga SECRET//NOFORN 06RIGA792|07RIGA56|07RIGA685 VZCZCXRO1012 OO RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV DE RUEHRA #0731/01 2711140 ZNY SSSSS ZZH O 281140Z SEP 07 FM AMEMBASSY RIGA TO RUEHC/SECSTATE WASHDC IMMEDIATE 4391 INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE IMMEDIATE S E C R E T SECTION 01 OF 03 RIGA 000731

SIPDIS

SIPDIS NOFORN

E.O. 12958: DECL: 09/27/2017 TAGS: PGOV, KCOR, PINR, PHUM, LG SUBJECT: PREVENTING FURTHER LATVIAN BACKSLIDING ON RULE OF LAW

REF: A) 06 RIGA 792 B) RIGA 56 C) RIGA 685 D)

TD-314/57033-07 E ) RIGA 714 F) RIGA 723

Classified By: Ambassador Catherine Todd Bailey. Reason: 1.4 (D)

1. (C/NF) Summary: One year ago, we said that the outcome of Latvia's parliamentary elections in October 2006 would be key to determining whether Latvia would continue to move forward to strengthen the rule of law or regress to old and non-transparent ways of doing business. Developments since then have shown little forward progress and plenty of backsliding. We believe we are at a critical juncture in Latvia. As the legal noose tightens around several oligarchs, they are making more brazen attempts to manipulate political power to protect their interests. The potential for significant, lasting damage to the rule of law is high and active US engagement with Latvian leaders is needed to reinforce their commitment to the values that underpin our bilateral and NATO relationships and protect our interests in Latvia. We should use PM Kalvitis' likely visit to Washington in early November to press this point. Most importantly for the longer term, though, we need to encourage and empower the Latvian people to take ownership of their country and engage actively when they see things they know to be wrong. End summary.

2. (C/NF) In the run up to and immediate aftermath of the October 2006 parliamentary elections, we identified the path of the rule of law in Latvia as the perhaps the most important issue in the election, although it was barely mentioned in the campaign (ref A). Events have borne this out. Attempts to place "friendly" judges on the constitutional courts, proposed changes to the law to increase the possibility of political manipulation of the security services, and the relatively weak handling of a case involving two oligarchs' attempts to manipulate the mayoral elections in the resort town of Jurmala put us on notice at the start of the year that things were headed in the wrong direction (ref B). The process by which current President Valdis Zatlers was elected in May seemed to indicate that the ruling coalition was operating entirely in its own interest. But then there were signs of progress. Aivars Lembergs, the mayor of Ventspils, was arrested on serious charges of corruption (ref C) and the prosecutor's office is making progress in efforts to level charges against former PM Andris Skele for his role in a multi-million scam related to digital TV.

3. (S/NF) It is perhaps because of these last two items that we find ourselves in a period of increased difficulty. In the natural reaction of someone who is cornered, as the noose tightens the oligarchs are lashing out. Lembergs is constrained a bit by the terms of his house arrest, but with no judicial proceedings having actually begun, plenty of people are still willing to act on the basis of his instructions. At the same time, the slight reduction in Lembergs' influence (especially for the four months he was in jail) has put Skele possibly at the height of his power. He has achieved an almost Voldemort like quality where no one dares speak his name, fearing the wrath of the dark lord, but instead stroke their chins (to symbolize his beard) or talk about things "in the clouds" to refer to Skele. All indications are that Skele handpicked Zatlers as President. And we strongly believe that Skele ensured the placement of Normans Belskis as an advisor (but de facto parallel chief of staff) in Zatlers' office despite Belskis' ineligibility for a security clearance (ref D). While Lembergs and Skele are among the biggest fish, they are far from the only problematic individuals in Latvia. They are, however, the highest profile representation of a class of individuals who manipulate politics and government to serve their personal financial interests.

4. (C/NF) In the last week, we have seen two dramatic events - the resignation of Speaker Emsis and replacement with a political unknown close to Lembergs (ref E) and the suspension of anti-corruption chief Loskotovs (ref F). While these have grabbed all the attention, perhaps the most important news was the indictment Sep. 21 of Jurgis Liepnieks for fraud and other charges in the digital TV case. Liepnieks was most recently PM Kalvitis' chief of staff and held the same position when Skele was PM in the late-1990's. Liepnieks had a major falling out with Skele in 2006 and has cooperated with prosecutors to turn state's evidence against him in the digital TV case. (Note: Prosecutors hoped to plea bargain with Liepnieks, but the chair of parliament's legal affairs committee, a close Skele ally, has kept the necessary legislation bottled up in committee. End note.)

5. (C/NF) We believe that these are not the last steps we will see. We expect attempts will be made to remove

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Prosecutor General Janis Maizitis and Intelligence (SAB) chief Janis Kazocins in coming months. In the latter case, Kazocins' term is up in early 2008, so it is more likely that the oligarchs will wait until they can replace him in the normal course of events, unless they think doing it sooner will protect them from prosecution. We also expect further attempts to weaken the laws governing the security services. These steps will continue even after a possible Skele indictment as they have since Lembergs' arrest. It will take public revelation of damning evidence (which we believe the prosecutor is developing) against both to get the public and -- EUR/PRA FOR ANITA FRIEDT, OSD/MD FOR PAUL IARROBINO, OSD/P FOR BRIAN GREEN, EUR/RPM

E.O. 12958: DECL: 10/01/2017 TAGS: NATO, PREL, MARR, KCFE, RU SUBJECT: MISSILE DEFENSE: 9/25 EXECUTIVE WORKING GROUP- REINFORCED MEETING READOUT

Classified By: DCM Richard Olson for reasons 1.4 (b), (d)

1. (S) Summary: In the September 25 Executive Working Group- Reinforced (EWG-R) meeting, the NATO International Staff agreed to prepare a draft report in response to the Riga missile defense tasking for the October 24-25 NATO Defense Ministerial. The U.S. informed Allies that it is seeking a political decision to pursue territorial missile defense at the Bucharest Summit (April 2-4). Allies did not react to our proposal in the EWG-R. In a prior bilateral meeting, the German delegation noted our proposal will be difficult to achieve. In a separate trilateral meeting, the Czechs and Poles offered full support. The French have not yet formulated a position on our proposal. Going forward, we will need to focus our efforts on breaking down German resistance through regular contacts both in the NAC and in Berlin. End summary.

IS FINALLY AGREES TO CARRY OUT RIGA TASKING
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2. (S) During the September 25 Executive Working Group- Reinforced (EWG-R) meeting, the NATO International Staff (IS) agreed to prepare a draft report on territorial missile defense (MD) to be presented at the October 24-25 Defense Ministerial in Noordwijk. This report is intended to be a first step in responding to the Riga Summit tasking that the EWG-R examine the political and military implications of MD prior to a NATO decision on whether to pursue such a capability. The IS will also use the report as the basis for the February 2008 "comprehensive report" to the NAC which was tasked at NATO's June 2007 Defense Ministerial.

3. (S) During the September 25 EWG-R meeting, the NATO International Staff (IS) agreed to address the unfulfilled Riga tasking on territorial missile defense, with the intent of submitting an interim report at the October 24-25 Defense Ministerial in Noordwijk. The IS will use this product as the basis for the February 2008 "comprehensive report" to the NAC that was tasked at the June 07 Defense Ministerial.

U.S. WANTS POLITICAL DECISION ON MD AT BUCHAREST
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4. (S) The U.S. informed Allies that it wanted Heads of State and Government to make a political decision to pursue a territorial missile defense capability at the Bucharest Summit, regardless of whether the EWG (R) has completed analyzing all of the details associated with territorial MD. The U.S. argued that a high level political decision to pursue missile defense can be made without having determined all of the details about architecture, operations, and other issues that can be resolved once a political decision is made. The U.S. pointed to its own decision to field its own territorial defense prior to making key decisions about what the system would look like and how it would operate. (Note: NATO,s decision to proceed with the Active Layered Theatre Ballistic Missile Defense Program was also made in this way. End note.)

BUT KEY ALLIES NEED CONVINCING
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5. (SBU) Although Allied reaction to the U.S. position was muted at the table, with Germany stressing the need to keep examining the many different taskings, privately Allies have been more forthcoming in their views. In a private meeting preceding the EWG-R, the Germans reacted negatively, pointing out the difficulties with reaching an agreement on MD by Bucharest. The Poles and Czechs, however, have told us they support our position. French representatives have indicated that they are in a "listening mode" until the conclusion of a defense "white paper" expected in the spring of 2008.

6. (S) Comment: Per conversations with the Allies and the International Staff, it is likely that the most significant "push back" to a Bucharest decision to pursue territorial MD will come from Germany. At this point, the Germans are unwilling to support a political decision on NATO MD without

a formal NATO determination regarding the system details and its possible impact on wider non-proliferation efforts. We will need to pursue senior-level discussions with the Germans - both at the NAC and bilaterally - to convince them to drop their resistance. At the moment the French are presenting a more neutral stance, as they re-evaluate their position on MD in light of their recent change of government. Bringing the French on board is likely to depend on how strong an MD deliverable the U.S. proposes. They will be more inclined to support a decision to pursue an MD system that involves a minimum of programmatic detail. We should engage them on MD as frequently as possible, particularly in capital.

7. (S) Comment Continued: We assess that there are two prerequisites needed to enable a political decision on MD at Bucharest. The first- an updated joint missile threat assessment- has just been completed and points out that WMD and missile-related technologies are becoming more readily available. The second- an updated NATO MD feasibility study by the conference of National Armament Directors- should be competed in January. End Comment. NULAND