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C O N F I D E N T I A L STATE 129520 SIPDIS E.O. 12958: DECL: 12/17/2019 TAGS: PGOV, PREL, ECON, ENRG, UP, MD SUBJECT: (U) Secretary Clinton's December 9, 2009 Meeting with Ukrainian Foreign Minister Petro Poroshenko 1. Classified by EUR Assistant Secretary Philip Gordon - Reasons: 1.4 (b) and (d) 2. (U) December 9; 1:15 p.m.; Washington DC; U.S.A 3. (U) Participants: U.S. Secretary Clinton Assistant Secretary Phil Gordon, EUR Ambassador Richard Morningstar, S/EEE Ian Kelly, PA Kristina Kvien, NSC Jacob Sullivan, S Liz Zentos, EUR/UMB (Notetaker) UKRAINE Foreign Minister Petro Poroshenko Ambassador Oleh Shamshur Deputy Foreign Minister Kostiantyn Yeliseev Chief of Staff to the Foreign Minister Yurii Onischenko Second Territorial District Director General Ihor Hrushko First Secretary Viktor Hamotskyi 4. (C) Summary: The Secretary discussed non- proliferation, security assurances, Ukraine's economic situation, and energy security with Foreign Minister Petro Poroshenko on December 9 in Washington. During the meeting, which followed the inaugural session of the U.S.-Ukraine Strategic Partnership Commission, the Secretary emphasized that, regardless of the presidential election outcome, Ukraine needs to end political infighting and implement economic reforms. She stressed the opportunity for Ukraine to make a significant contribution to the President's April nuclear security summit and urged Ukraine to make critical reforms in the energy sector. Poroshenko agreed to the Secretary's offer to send a team to Kyiv to discuss a U.S. proposal to remove Ukraine's highly enriched uranium fresh fuel. He emphasized the importance of the IMF's release of further disbursements from the Stand-By Agreement before the election to send a symbolic message, even if the disbursement is partial. End summary. -------------------------------- END INFIGHTING TO ENABLE REFORMS -------------------------------- 5. (C) The Secretary noted the importance of the inaugural U.S.-Ukraine Strategic Partnership Commission meeting, which had taken place earlier in the day. Ukraine must remain independent and stable and must become prosperous again. She emphasized that after the election, Ukrainian leaders should end political infighting and take concrete steps on reform -- especially economic reforms to get back on track with the IMF. She stressed that the IMF had held up the fourth tranche because of both budget deficit problems and a lack of political consensus. 6. (C) Poroshenko echoed the Secretary's comments that the first meeting of the Strategic Partnership Commission was significant and suggested that he and Secretary Clinton should co-chair future sessions. He stated that Ukraine would pass the "test of democracy" by holding a free and fair presidential election. As an economist, he understood Ukraine needed to implement reforms, and he emphasized he had made progress recently by having the Prime Minister, Finance Minister, and President of the National Bank sign an Letter of Intent to the IMF. Ukraine was now urging the IMF to send a mission before the election, and that disbursement from the IMF before the election would send an extremely important message to the Ukrainian people. Ukraine should be able to make its gas payment in January, but the February payment could be difficult. ---------------------------- SECURITY ASSURANCES AND NATO ---------------------------- 7. (C) Secretary Clinton reiterated that the United States stood behind the Budapest Memorandum security assurances and that these assurances had not changed with the expiration of the START Treaty. She emphasized that the United States envisioned multiple pathways to NATO membership. The United States, however, had received mixed messages from Ukraine during its presidential campaign, and Ukraine's friends wondered whether Ukrainians really wanted NATO membership. The United States continued to support Ukraine's eventual membership in NATO, but the Secretary reminded Poroshenko that all aspirants must meet NATO standards. She noted that during the December 3 NATO-Ukraine Commission meeting, Allies commended Ukraine on the finalization of its first Annual National Program and urged Ukraine to make further progress through its 2010 program. 8. (C) Poroshenko was pleased by the U.S.-Russia statement reaffirming the Budapest Memorandum security assurances. He proposed bilateral consultations to establish new security "guarantees" for Ukraine, saying such consultations were needed to avoid an incident similar to the Russia-Georgia war. Poroshenko lamented that Montenegro and Bosnia, which had not voluntarily given up nuclear weapons, were on their way to NATO membership. Ukraine felt that NATO had demanded greater reforms from it than from other countries. He claimed that both Prime Minister Tymoshenko and opposition leader Yanukovych had agreed to avoid raising NATO in their campaigns. --------------- ENERGY SECURITY --------------- 9. (C) Poroshenko stated it was vital that the EU invite Ukraine to join the European Energy Community at the December 18 ministerial in Zagreb. The Secretary agreed that energy security was essential. Ambassador Morningstar said that he had actively lobbied for Ukraine's inclusion in the Energy Community and would be happy to make another approach to the EU. (Morningstar later spoke with European Commission Pielbalgs to voice continued support for Ukrainian membership.) Morningstar noted that the EU was considering a compromise agreement that would involve a two-step approach to Ukraine's membership. He noted some progress on energy issues, e.g., progress with Russia on gas issues at Yalta, but emphasized that this was short- term; what was needed was long-term reform. The United States was ready and willing to help Ukraine modernize its gas sector, increase energy efficiency and improve the investment climate, if Kyiv's commitment was there. The Secretary stressed that Ukraine could boost its independence and sovereignty by increasing its energy independence. ----------------- NON-PROLIFERATION ----------------- 10. (C) The Secretary applauded the non-proliferation initiative Ukraine presented at the OSCE ministerial, adding that Kyiv could truly demonstrate its commitment to non-proliferation by agreeing to give up its highly enriched uranium (HEU). She suggested our two countries work together to reach agreement on a plan before the April nuclear security summit. The Secretary suggested a new proposal -- to transfer HEU fresh fuel out of Ukraine by December 2010, and she offered to send a team to Kyiv to discuss the details. The Secretary noted that, while some in Ukraine felt keeping HEU was a security blanket, the U.S. believed that this could have the opposite effect. 11. (C) Poroshenko responded that Ukraine would be happy to accept a U.S. team at any time. He said he believed Ukraine could achieve quick results with the HEU at the Kyiv facility and that he had appointed a group of experts working under his direction to study how to move forward on the HEU in Sevastopol and Kharkiv. -------------------------------------------- AFGHANISTAN, MOLDOVA, CRIMEA, AND COPENHAGEN -------------------------------------------- 12. (C) Poroshenko stressed that Ukraine stood with the United States in Afghanistan, and referred to Ukraine's decision to increase its troop presence from 10 to 30. He said that his government could vote on a rail transit agreement for Afghanistan as early as December 16. Poroshenko noted that he had proposed to Russian Foreign Minister Lavrov that Ukraine and Russia open a hospital in Afghanistan. 13. (C) Poroshenko commented on his productive meetings with the new Moldovan leadership. He planned to meet with Foreign Minister Leanca on December 14 to launch a project to demarcate Ukraine's border with the Transnistria region of Moldova. Ukraine would appreciate a strong U.S. signal supporting this initiative. Poroshenko noted that Moldova had agreed to re-engage with GUAM and to take over the rotating presidency in 2011, following Ukraine. 14. (C) Ukraine supports the opening of a U.S. diplomatic presence in Crimea, Poroshenko told the Secretary. He emphasized the importance of Crimea, and said that having U.S. representation there would be useful for Ukraine. Poroshenko requested a meeting for President Yushchenko with the President on December 18 in Copenhagen. He also invited Secretary Clinton to visit Ukraine, noting that he understood the many competing demands for her time. 15. (C) Poroshenko complained that the United States had pushed to designate Ukraine a high-risk country as the Financial Action Task Force considers Ukraine's compliance on its anti-money laundering regime. Assistant Secretary Gordon said that he would look into this. (Embassy Kyiv will receive instructions to follow up on this FATF initiative and make clear the steps Ukraine needs to take on money laundering to avoid designation by FATF.) Poroshenko thanked the Secretary for her support as a Senator during the Orange Revolution and expressed his deep appreciation for the meeting. CLINTON