VZCZCXRO0412
RR RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHRK #0001/01 0050910
ZNR UUUUU ZZH
R 050910Z JAN 07
FM AMEMBASSY REYKJAVIK
TO RUEHC/SECSTATE WASHDC 3111
INFO RUEKJCS/SECDEF WASHDC
RHMFISS/HQ USEUCOM VAIHINGEN GE 0046
RUEHZL/EUROPEAN POLITICAL COLLECTIVE

UNCLAS SECTION 01 OF 02 REYKJAVIK 000001 
 
SIPDIS 
 
C O R R E C T E D  C O P Y (text para 7 AND TAGS) 
 
SENSITIVE 
 
SIPDIS 
 
SECDEF FOR OSD/P (KELSO, HURSCH), OSD/RA (COSTA) 
OSLO FOR DATT 
EUCOM FOR COL FRANKLIN AND LTC GREEN 
 
E.O. 12958: N/A 
TAGS: MARR PREL PTER NATO DK IC NO
SUBJECT:  Iceland: Defense Bilats with NATO Allies Reflect Maturing 
Icelandic Approach to Security Cooperation 
 
Ref:  06 Reykjavik 431 
 
REYKJAVIK 00000001  001.2 OF 002 
 
 
¶1. (U) Summary:  Following the closure of U.S. Naval Air Station 
Keflavik in September 2006, the Government of Iceland has begun 
reaching out to other NATO allies to solicit interest in security 
cooperation - and demonstrate to the public, in an election year, 
that it will protect them.  December 2006 visits of an Icelandic 
delegation to Denmark and a Norwegian delegation to Iceland produced 
no agreements (nor were they expected to), but set the stage for 
follow-on talks in late January/early February.  The GOI has also 
announced plans for exploratory talks with Canada and Britain in 
early 2007. 
 
¶2. (U) Reflecting a growing realization within the Government that 
Iceland will find it easier to encourage allied cooperation in the 
North Atlantic if Reykjavik increases its own contributions to the 
Alliance, Iceland will start contributing to the NATO Infrastructure 
Fund in 2007.  Increasingly, leading media and other opinion makers 
seem prepared to accept that Iceland can and should contribute to 
its own defense and to Alliance operations both in and out of area. 
End summary. 
 
¶3. (U) In the months since the September 2006 closure of Naval Air 
Station Keflavik (NASKEF), the Government of Iceland has made 
overtures to several NATO allies regarding security cooperation in 
the North Atlantic.  Most substantively, the GOI has begun a process 
of bilateral talks with Denmark and Norway regarding cooperation on 
air defense/surveillance exercises, search and rescue, and maritime 
patrol.  In its public discussion of the issue, the GOI has tied its 
long-standing desire for visible air defense to forecasts of rising 
maritime traffic in the next few years, and arguing that this 
creates an increased need for multilateral security engagement in 
the region. 
 
¶4.  (SBU) Danish and Icelandic delegations met in Copenhagen on 
December 18 for a first set of talks, and set a follow-on date for 
February in Reykjavik. The Icelandic delegation consisted of the 
"Committee of Three" that has policy coordination responsibility for 
defense and security issues: the Prime Minister's Foreign Affairs 
Advisor, the Permanent Secretary of the Ministry for Foreign Affairs 
(MFA), and the Head of Police and Justice Affairs at the Ministry of 
Justice (MOJ). 
 
¶5. (SBU) Generally positive press reports quoted both sides' 
assurances of further cooperation, while FM Sverrisdottir said the 
meeting had been more positive than she anticipated.  News reports 
further indicated that Icelandic-Danish cooperation would seek to 
build on existing Coast Guard and Naval patrols of the countries' 
economic zones and collaboration in search and rescue.  A Danish 
source confirmed that the talks had indeed gone quite well, and that 
the follow-up talks in February would be more extensive. 
Additionally, he noted that in a separate but related initiative, 
Denmark's Minister of Defense will arrive in Reykjavik on January 10 
for the signing of a long-planned Memorandum of Understanding on 
security cooperation with the Icelandic MOJ. 
 
¶6. (U) From December 19-20, a Norwegian delegation of Ministry of 
Defense and MFA representatives came to Iceland, first for talks at 
the MFA and subsequently for a tour of facilities at the former 
NASKEF site.  Post facilitated the tour by providing an escort and 
access to NATO-owned facilities at the site (facilities for which 
the U.S. still holds the keys and pays the bills as NATO host 
nation) and a briefing by Embassy's resident EUCOM MilRep.  In a 
pre-visit press article as well as press statements while the 
delegation was in Reykjavik, Norwegian officials said that the 
Norwegian government is looking towards Iceland for cooperation in 
order to step up its security on important shipping routes in the 
area. 
 
¶7.  (SBU) Iceland has also looked to start similar discussions with 
the U.K. and Canada.  MFA PermSec Gretar Mar Sigurdsson told the 
press in December that an Icelandic delegation will meet with 
officials in London January 16.  A British source confirmed that the 
"Committee of Three" will have talks at the Foreign and Commonwealth 
Office and the Prime Minister's Office, adding that the GOI was 
unrealistically raising public expectations of the level of British 
interest.  Similarly, Canadian and other sources tell us that the 
GOI's reports of "defense talks" with Canada reflect nothing more 
than a planned visit by the Canadian Defense Attache in Oslo, though 
Iceland hopes for more to follow. 
 
¶8.  (SBU) Throughout the newest round of consultations, the GOI has 
been at pains to say that Iceland is not requesting permanent 
stationing of military forces in Iceland, nor is it asking other 
 
REYKJAVIK 00000001  002.2 OF 002 
 
 
states to initiate any new financial or resource commitments 
vis-a-vis Iceland (i.e., "replacing the Americans").  Officials at 
both the MFA and Prime Minister's office told post they hoped these 
moves would complement but not replace the post-NASKEF security ties 
Iceland and the U.S. are building, a line that the MFA's PermSec has 
taken publicly as well. 
 
¶9.  (U) The GOI also now seems to be interested in contributing more 
to NATO in the hopes of getting more out of the Alliance.  On 
December 18 conservative, generally pro-GOI Morgunbladid reported 
(and applauded) that Iceland recently became a party to the NATO 
Infrastructure Fund and will start making payments to it in 2007. 
The payments will start at a modest $31,500 per year, rising to 
$408,000/yr in 2016.   Morgunbladid went so far as to urge the 
Government to begin paying the full amount this year.  A few voices 
- including the center-right, but more populist daily Bladid - have 
grumbled that Iceland should not be required to pay other allies for 
defense, but these appear to be outliers to a growing consensus that 
Iceland should contribute to its own security. 
 
¶10.  (SBU) Comment:  These first efforts at reaching out to the 
allies come in the wake of prominent local news reports that FM 
Sverrisdottir had arranged for bilateral talks with Denmark, Norway, 
Britain, and Canada when she attended November's NATO summit in 
Riga.  Many here expressed doubt that those countries were as 
interested in discussing security cooperation with Iceland as the FM 
made them out to be - putting heat on the GOI to deliver some 
bilats, potentially opening itself to further charges of 
exaggeration if nothing concrete emerges. 
 
¶11. (SBU) This backdrop should not distract from the important 
development that the GOI appears to have crossed a crucial line in 
thinking about defense as a multilateral cooperative endeavor in 
which Iceland should be a partner, rather than as something that the 
Americans (or other allies) should be expected to provide at no 
cost.  A key test of this assertion will be the extent to which 
Iceland agrees to provide support (e.g. billeting, fuel, Search and 
Rescue services) to U.S. or other forces contemplating exercises in 
and around Iceland. 
 
¶12. (SBU)  It is also indicative of more mature thinking on security 
in Iceland outside the halls of government that key opinion leaders 
are welcoming Iceland's participation in its own defense by 
contributing to the NATO Infrastructure Fund, and actively looking 
for international partners for search and rescue operations and air 
surveillance during peacetime.  Iceland's commitment (reftel) to 
maintaining its contribution to peacekeeping in Afghanistan, Sri 
Lanka, and other hot spots - even as it seeks roles appropriate to a 
nation with no military forces or tradition - is a further 
reflection of Icelanders' reluctant but growing acceptance that (to 
paraphrase Trotsky) they may not be interested in war, but war is 
interested in them. 
 
KOSNETT