Dokumentarkiv och kronologi för Finlands utrikespolitik

År 1998 i Finlands utrikespolitik


In his traditional New Year's Speech, President Martti Ahtisaari said that the status of Finland's security policy was good and that the country's possibilities of co-operation with all parties had increased. Finland's ties with Sweden were closer than they had ever been during any period in which the country had been an independent state. With reference to the differences between Finland and Sweden in relation to the expansion of the European Union, President Ahtisaari pointed out that the closeness "cannot be tarnished by modest disagreements in issues, which are not related to the core areas of our mutual relationships". In the President's judgement, the Finnish-Russian relationship is now increasingly characterised by natural interaction. According to him, Finland plays a significant role in the development of interaction between the EU and Russia. Mr. Ahtisaari also took a stand in favour of the single European currency. He made reference to a survey conducted by the Research Institute of the Finnish Economy, ETLA, and said that the Euro will benefit Finnish companies to a greater extent than companies in other EU countries. According to Mr. Ahtisaari, "a member state dependent on foreign trade, such as Finland, will receive a new impetus for growth from the single common currency."


The Committee of 100, a Finnish peace association, considered that the conferring of the decorations by President Ahtisaari on an Indonesian businessman and the Indonesian Minister of Forestry was a questionable matter. In the opinion of the association, the fact that one of the decorations was conferred upon "a minister of a government which is flagrantly violating human rights" was in conflict with the programme of the Finnish government which emphasises human rights and environmental protection in Finnish foreign policy. The environmentalists, for their part, demanded that the Finnish forestry group UPM-Kymmene should withdraw from its co-operation with April, a RGM Group company. On January 15, the President commented on the stir aroused by this matter. In his view the conferring of the decorations had been justified.


Prime Minister Lipponen visited Spain, meeting with King Juan Carlos and Prime Minister Jose Maria Aznar. During their meeting, Mr. Aznar proposed that Spain and Finland search for ways to adapt Mediterranean issues to the Northern Dimension initiative presented by Finland within the EU. The views of Finland and Spain diverge over the focal areas. According to Mr. Lipponen, the primary tasks of the EU include issues related to Europe's eastern and northeastern corners; once they have been taken care of, then it would be important to concentrate focus on the pressures and problems of the Mediterranean areas.


During the opening ceremony of the 146th Defence Course in Helsinki, Mrs. Anneli Taina, Minister of Defence, said that she considers the rapid deployment brigades and their associated helicopters as the major sub-entity in the development of Finnish military defence. Mrs. Taina pointed out that the intention is to develop Finland's crisis management capacity so that Finland is better able to participate in operations approved by the UN or the OSCE in collaboration with the NATO-allied or Partnership-for-Peace countries. Minister Taina also said that Finland could only do away with its landmines if an appropriation of c. FIM 4.5 billion were reserved for a system to replace the mines.


On the basis of the processed applications for political asylum, about half of the applicants (50.2 %) received permission to stay in Finland. Asylum was granted to four persons, and resident permits to 277.


The fifth meeting of Foreign Ministers of the Barents Sea Euro-Arctic Council was held in Luleå, Sweden. The meeting evaluated the development of Barents Sea co-operation in its major operative areas, which include economic and environmental co-operation as well as the development of the regions infrastructure. In her speech, the Finnish Foreign Minister, Tarja Halonen, emphasised the importance of the EU initiative on the Northern Dimension. According to Ms. Halonen, Europe will be increasingly dependent on the oil and gas resources of northwest Russia. Exploiting these resources will be the major challenge for Barents Sea co-operation.


Mr. Strobe Talbott, the US Deputy Secretary of State, visited Finland and met with President Ahtisaari, Prime Minister Lipponen and Foreign Minister Halonen. In an address at the Paasikivi Society, he focused on the arguments and the associated motivations for more extensive co-operation with Russia, emphasising the importance of co-operation in the Baltic and the Barents regions. Mr. Talbott said that the US respects the security policy orientations adopted by Finland and Sweden and that it was not putting any pressure on any country to change its policy. According to Mr. Talbott, the US defends every sovereign state's right to determine how it chooses to safeguard its own security.


According to an opinion poll commissioned by the Finnish TV channel MTV3, a clear majority of Finns would like to emphasise the importance of human rights in the country's foreign policy to a greater extent than is presently the case. When asked, "Did President Ahtisaari act correctly when he conferred the decorations to Indonesia?" 19 % of the respondents answered "yes" while 56 % said "no". The question, "Should more consideration be given to human rights in foreign policy?" got an affirmative answer from 67 % of the respondents.


In the Latvian capital, Riga, the Prime Ministers of the Baltic countries participated in a meeting of the Council of Baltic States. The meeting addressed the problems and development of the Baltic area prior to the expansion of both the EU and NATO. The 78-item report on organised crime produced by a Task Force, jointly representing 11 countries and the EU, was also presented in Riga. The participants adopted a resolution to prolong the Task Force assignment until the end of 1998. Prime Minister Lipponen characterised the Riga meeting as an important milestone in the process in which the situation of the Baltic countries is stabilising and their relationship to Russia is becoming normalised.


Foreign Minister Halonen participated in a meeting of the EU-Russian partnership council in Brussels. According to her, it is important for the EU that co-operation with Russia is properly taken care of. She also said that the EU supports the political and economical reform underway in Russia.


An EMU survey commissioned by the association "Eurooppalainen Suomi" showed that the Finns' attitudes to EMU are positive. More Finns were in favour of Finland joining Economic and Monetary Union than opposed it. The share of the pro-EMU Finns had increased from 36 % in December to the present level of 44 %, while the share of anti-EMU attitudes had decreased from 46 % to 40 %.


In Tallinn, Mrs. Anneli Taina, Minister of Defence, and her Estonian counterpart, Minister Andrus Öövel, signed an agreement on military training, co-operation and material assistance between the two countries.


In a press conference, Prime Minister Lipponen said that Finland is actively working for the eradication of anti-personnel mines. The Ministry for Foreign Affairs and the Ministry of Defence are continuing to study the issue so that the objective of giving up anti-personnel mines could be taken into account in the upcoming and comprehensive defence policy statement. Mr. Lipponen also touched upon the issue of helicopter acquisitions. He said that the credibility of Finland's non-alliance policy calls for decisions on creating new rapid deployment brigades. However, he insisted that the costs of acquisition must remain within a strictly defined framework. As concerns EMU, the common monetary policy must, according to Mr. Lipponen, enjoy the confidence of the citizens. In his view, the European Central Bank should be characterised by openness and it should be in constant interaction with the Council of Ministers of the EU, as well as with labour market organisations. The Prime Minister also said that he would like to see a considerable increase in the resources allocated to the Northern Dimension, proposed by Finland in the EU.


Commander-in-Chief of AFNORTHWEST, General Johan Cheshire, visited Finland. In an event organised by the Finnish association "Maanpuolutuskiltojen liitto" (Federation of Defence Guilds) he said that, from the point of view of more extensive NATO tasks, it would be easier if Finland and Sweden were members of the military alliance. According to General Cheshire, this would fill in the geographical holes. A unified geographical area would facilitate operations in both air and marine defence. He underlined that his comment was a military one. Finland's joining NATO would be a political decision.


The Government submitted the Amsterdam Treaty, a reform of the EU, to Parliament and proposed that the Treaty be adopted by a qualified majority of two thirds of the Parliament, as the Treaty would transfer more powers from Finnish political institutions to the EU institutions.


At a session organised by the association, the European Security Forum (Euroopan turvallisuusfoorumi ry), Foreign Minister Halonen said that crisis management was the touchstone of Europe. All over Europe, the generally accepted operative premise is the need for a comprehensive security concept. The spectrum of security issues is expanding and, according to Ms. Halonen, this is one of the main challenges for Finnish security policy in the near future. The number of issues requiring a reaction is growing, and these reactions must be rapid. She added that there are several European and Euro-Atlantic security organisations, and therefore it is to be expected that their operations will be increasingly overlapping. In crisis situations, it is difficult to identify operative models for individual operators. The absolute primacy of the UN in peacekeeping operations has recently been questioned, and the organisation's peacekeeping operations have decreased significantly.


The issues raised by President Ahtisaari in his speech at the opening of Parliament included decisions regarding Finland's participation in EMU, the reform of the Constitution, the helicopter acquisition projects, as well as Finland's relationship with its neighbouring countries. In his view, this reform will improve the operative conditions of the Finnish State government in the new millennium, appropriately responding to the demands created by membership in the EU. The President commented on the helicopter acquisitions by saying that a correctly dimensioned operative defence capability is important for the credibility of Finnish security policy and that this issue needs to be taken care of. He also proposed that co-operation with Sweden in materials issues be increased. The President also touched on Finland's relationship with its neighbours by saying that "during the period of our independence we have never before had good relations with all our neighbouring countries at the same time. Now we have. It is important to recognize this fact. It gives us new opportunities, from which all benefit."

The President's comments on Finland's relations with its neighbours caused some perplexity. The general interpretation was that the President had referred to Finland's relationship with Russia. According to Chairman Esko Aho of the main opposition party, the Centre Party, this comment was most likely a blunder by the speechwriter. Mr. Aho thought that if the President "really meant what he said, history should be rewritten, or at least the President should explain his choice of words." In Mr. Aho's view, the interpretation of Finnish foreign relations was "very different from what we have been used to". On February 5 in Pietarsaari, during one of his visits to the Finnish provinces, President Ahtisaari commented on the section of his speech on Finland's neighbourly relations. He said that with this phrase, he had referred to Estonia in the 1990's. According to Mr. Ahtisaari, "it is completely impossible that if one of our neighbours is not independent that we can have a normal and good relationship with it. The situation changed radically when Estonia regained its independence."


On the occasion of the 50th anniversary of the UN Declaration of Human Rights, Foreign Minister Halonen inaugurated the celebrations in Helsinki. Ms. Halonen was also the first Finn to sign an Amnesty International paper, whereby the signatories commit themselves to do their best for the implementation of rights based on the global declaration of human rights in all parts of the world. Ms. Halonen emphasised that the UN Declaration on Human Rights continues to be important and up-to-date. She hoped that the rights recorded in the Declaration would be strengthened, especially as far as women and children are concerned.


The Government gave Parliament their proposal for a new Constitution. The bill was based on the proposals made by the parliamentary committee in its report submitted in summer 1997. However, the parts of the bill which concerned decision-making in foreign policy and the formation of the Government were revised. If Parliament adopts the bill, the presidential powers will be slightly reduced, while the status of the Government will be strengthened. On 10 February, Parliament began to debate the bill. Chairman Esko Aho of the main opposition party, the Centre Party, repeated his party's position according to which the balance between the presidential powers and the use of power by Parliament requires a clear improvement in the status of Parliament in the formation of the Government. According to Mr. Aho, "the starting point must be that, under normal circumstances, the formation of the Government will take place under the leadership of Parliament."


The Foreign and Security Policy Committee of the Government, headed by Director-General Pertti Torstila of the Ministry for Foreign Affairs, decided that the Ministry for Foreign Affairs and the Ministry of Defence will continue to conduct surveys related to Finland's eventual signing of the Ottawa Treaty on the Prohibition of landmines and the replacement of the mines with other measures. The Committee considered that the report by the mine-working group, published in December, was not sufficient as a basis for decision-making. The Committee also adopted a considerable increase in the grant for assisting mine-clearance in Finland. Over four years, a total of FIM 120 million will be appropriated to the clearance of mines.


Head of Defence, General Gustav Hägglund, said at a lunch with political reporters that if Finland wishes to co-operate with Sweden in the acquisition of helicopters, Parliament should quickly finalise its decision about the acquisition mandate related to the helicopters. General Hägglund reminded them that Sweden was currently receiving tenders for new transport helicopters and was expected to make a decision on the order during the spring. The benefit of a joint order would be a more advantageous price. General Hägglund justified the acquisition with the fact that the new helicopters could be used to prevent, for example, any attempt to hijack and kidnap top state officials.


In his column in the daily Helsingin Sanomat, Minister Max Jakobson pointed out that the statement by President Ahtisaari about the neighbourly relations had re-ignited the debate on the nature of the Finno-Soviet relationship. Mr. Jakobson said that when Presidents Paasikivi, Kekkonen and Koivisto had said that the relationship with the Soviet Union was good, "in their mind it was as good as was possible to achieve with the measures available to Finland and under the circumstances prevalent at each given moment. The conditions were set down by the stronger party." As a consequence of the great changes that have taken place in Europe, Russia has taken a clear distance from the position of the Soviet Union as regards the attitude towards Finland. According to Mr. Jacobson, the problem is that in its official statements, Finland has not rendered an equally outspoken account of its relationship with the Soviet Union. In his view, the Finns should discuss their past among themselves in plain terms.


On the occasion of the debate at Parliament on the ratification of the EU Amsterdam Treaty, Prime Minister Lipponen said that in his view, it is important that the EU decision-making system and institutional structures be further reformed. Mr. Lipponen said he was concerned that, in the worst of cases, a single country looking out for its national interests could prevent the decision-making of the 15 member states. According to him, Finland is in favour of more decisions being made by a qualified majority in order to intensify and speed up the operations of the Community. In the Prime Minister's assessment, Finland would also gain more authority in common policy. The Amsterdam Treaty contains several reforms which are positive from Finland's point of view, said Mr. Lipponen, quoting those related to crisis management, employment, openness and the environment.


Finland participated in the NATO crisis management exercises in Brussels, along with the NATO member countries and the 22 countries included in the PfP Programme. These were command exercises implemented on the map with no troops present. The objective of the exercise was to practice decision-making and contacts related to a multi-national crisis management operation.


The Government sent Parliament a supplementary budget proposal which included the purchase of the helicopters and the acquisition mandate for the new rapid deployment brigades. On February 13, the peace associations "Suomen Rauhanliitto" and "Sadankomitea" published their views, according to which the Defence Forces do not need any new helicopters. In the view of these organisations, the future outlook does not contain any threats such as would justify the acquisition of the helicopters, especially at such short notice.


In a meeting organised in Oulu about co-operation between the northern regions, Finnish Prime Minister Lipponen said that he was shortly going to propose to Prime Minister Göran Persson of Sweden that the countries start to collaborate more closely in economic policy. Mr. Lipponen referred to the corresponding tradition between France and Germany, praising their exemplary co-operation on the eve of EU summits. He felt that Sweden, which is not participating in the third stage of EMU, would be interested in joint negotiations on economic policy. On February 16, the Swedish Prime Minister Persson informed the Swedish news agency TT of the same matter. He said he hoped that the regular meetings would help to clear up misunderstandings and facilitate the formulation of joint initiatives. Co-operation in security policy was particularly important in his view.


Prime Minister Lipponen visited the US, meeting with Vice President Al Gore, Deputy Secretary of State Strobe Talbott and former Secretary of State Henry Kissinger. The issues touched upon in the discussions included the Iraq crisis and the Baltic region. Mr. Lipponen emphasised that from Finland's point of view, it is important that Iraq respects the resolutions of the UN and consents to weapons inspections without any restrictions. In the Baltic region, the US wants to assist in the prevention of crime and in the cleaning up of nuclear waste. Finland was asked about the possibility of temporarily storing the nuclear waste. Speaking to business and banking circles, Mr. Lipponen assured that Finland's economic situation is healthy. He also anticipated that the dollar would have a tough competitor once the Euro is launched. The Prime Minister told journalists that the helicopter acquisitions planned by Finland would not result in any additional defence costs. According to him, the helicopters are a part of the development of Finnish defence, and they are needed to guarantee the mobility of the troops. He also said that if Iraq is bombed, Finland would be prepared to provide assistance to civilians.


In a joint article published in the daily Helsingin Sanomat, Chairman Lars Leijonborg of the "Folkparti" of Sweden, Chairman Uffe Elleman-Jensen of the Danish leftist party "Venstre", and Chairman Ole Norrback of the Swedish People's Party of Finland, proposed that the Nordic countries which are EU members should intensify their co-operation within the EU. According to the Chairmen, the Nordic countries should not conceal their differences in opinion, but they should be systematic in pushing for their joint interests, along the lines of the Benelux countries, or France and Germany.


In an interview given in Nagano, President Ahtisaari said that he was still hoping for a peaceful solution to the Iraq crisis. According to Mr. Ahtisaari, Iraq must obey the UN Security Council resolutions. All diplomatic measures should be used, but the UN control system should not be watered-down. Mr. Ahtisaari did not give any direct support to US bombing threats but he said the issue was under the authority of the UN.


The Government adopted a communiqué on EMU to be given to Parliament. It decided to propose to Parliament that Finland should be among the first countries to join EMU. According to the Government participation in EMU is politically and economically justified.


Foreign Minister Halonen said that no new resolution of the UN Security Council was required for the bombing of Iraq. Ms. Halonen underlined that Iraq had been acting against the UN resolution. She said it was premature to comment on whether Finland would support eventual military actions against Iraq, should Secretary-General Kofi Annan's negotiations in Iraq fail.


According to an opinion poll commissioned by the association 'Eurooppalainen Suomi', the question of Finland's participation in EMU was an issue that divided the citizens clearly in two groups. Of the respondents, 40 % were in favour and 40 % were against participation. Positive attitudes were at their highest in January 1998 (44 %) but have now fallen to the same level where they had been almost throughout the whole previous year.


Parliament began the debate on the Government's EMU communiqué. Mr. Sauli Niinistö, Minister of Finance, presented the communiqué and pointed out that EMU membership is a logical continuation of Finland's orientation to the west. He said he believed that EMU would bring Finland, which is geographically remote from the rest of Europe, closer to the others. Turning to those worried about the future of the welfare state, he said that EMU is a part of the European welfare project and that it will improve general economic development. Speaking for the opposition party, the Centre party, MP Mauri Pekkarinen said that the Government had forgotten to listen to the people since it was not going to organise a consultative referendum. He also repeated the stand expressed by the Centre Party Congress, according to which Finland should not join the EMU at its launch on January 1, 1999.


A movement demanding a referendum on EMU submitted a petition with almost 40,000 signatures to the parliamentary groups. The signatories of the petition demanded that a consultative referendum be organised before Finland decided upon participation in EMU. A referendum was also demanded to establish whether Finland should adopt the new EU Treaty, the so-called Amsterdam Treaty. The petitioners considered that it is wrong to interpret the adoption of EU membership as an open mandate, giving the Government the authority to proceed in the development of integration with no heed to the opinions of the citizens of the country.


At a meeting of the Nordic Council on the environment, held in Gothenburg, Sweden, the other Nordic countries criticised Finland for not taking its Nordic partners along when it submitted the initiative of the so-called Northern Dimension to the EU. In the other Nordic countries, this was interpreted as meaning that Finland was trying to surpass the rest of the Nordic area in EU issues. Foreign Minister Halonen indicated that in pushing for the initiative, it was not essential to have the support of the other Nordic countries. It was more important to sound out the opinions of the majority in the EU. According to Ms. Halonen, the criticism presented by the Danes was part of an open discussion among the Nordic family.


Foreign Minister Halonen gave a statement regarding the UN-Iraq agreement for the continuation of the work of UNSCOM. She said she was satisfied with the agreement negotiated by UN Secretary-General Kofi Annan in Iraq. She said this was a victory for diplomacy and would enhance the authority of the world organisation as a keeper of international peace and security.


In a radio interview, Prime Minister Lipponen said that Finland had no reason to seek membership in the NATO of present-day Europe. However, he found that it was important for Finland that the door to NATO remained open. "The possibility of alignment is also included in our policy of non-alliance", Mr. Lipponen commented. The Finnish premise is to remain non-aligned, to develop its independent defence and to work in as close co-operation with the NATO as possible. He also emphasised that the helicopter acquisitions and the establishment of rapid deployment troops did not mean that Finland would be adapting its defence forces to NATO structures. However, developing a relationship with NATO also includes the development of co-operation capacities in view of crisis management tasks.


The Portuguese Prime Minister, Mr. Antonio Guterres visited Finland, meeting with President Ahtisaari and Prime Minister Lipponen. Mr Guterres expressed his strong support for the Finnish initiative regarding the Northern Dimension. He said that the Northern Dimension had an impact on all of Europe and that stability in that region, as well as its close co-operation with Russia, was very desirable.


A group of researchers made an appeal to Parliament in order to arrange a referendum on Finland's participation in EMU. The researchers pointed out that signing the Maastricht Treaty did not obligate Finland to join EMU and that Finland had the right to withdraw at any time from the obligations imposed by the Treaty. They justified the need for the referendum by saying that the 1994 referendum in Finland was not about EMU participation but EU membership.


Foreign Minister Halonen visited Belgrade, meeting with the leaders of Federal Yugoslavia and participating in a meeting of the Finnish Embassies in the Balkans. In Ms. Halonen's view, the EU had fairly poor chances of influencing events in Kosovo in the short-run, but in the longer-term, the political pressure exercised by the EU could have an impact.


The Foreign and Security Policy Committee of the Government adopted a resolution on Finland's participation in an international project to build containers in the Murmansk area for the temporary storage of disposed nuclear fuel.


The parliamentary groups of the parties in the Government agreed to cut by FIM 1.2 billion the FIM 7.7 billion order related to the three rapid deployment brigades proposed by the Government. More specifically, the cut pertained to the FIM 4 billion share allocated to the helicopters.


The Social Democratic parliamentary group demanded further negotiations on the helicopter acquisitions. Unexpectedly, the group voted down the agreement on the cuts. The group insisted that the Government decrease the defence appropriation in proportion to the cuts.


President Ahtisaari, Prime Minister Lipponen and Foreign Minister Halonen were in London to participate in the European Conference on EU expansion, crime and drugs, arranged between the heads of state and government of the 15 EU countries and the 11 countries wishing to join the Union. The Conference published a statement condemning Serb attacks against ethnic Albanians in Kosovo. According to President Ahtisaari, the launching of the expansion process was the major outcome of the European Conference from the Finnish point of view.


The EU Foreign Ministers held an unofficial meeting in Edinburgh. They said they would give their support to the statement on the Kosovo situation given by the so-called Contact Group made up of six political major powers. According to the statement, economic sanctions would be imposed on Yugoslavia unless it consented to negotiate with the western countries by 25 March. The Ministers also wanted to establish a separate group in which the countries in the region directly affected by the Kosovo problem negotiated a solution among themselves. Foreign Minister Halonen hoped for an urgent solution to the problem. According to her, many EU countries have a bad conscience over dragging their feet on Bosnia.


The Commission of the EU published the latest Eurobarometer report of data collected during October-November 1997. According to this barometer, Finnish attitudes towards EMU were still among the most negative of all EU countries. Sixty-two percent of the Finnish people were against monetary union, while 33 % were in favour.


Foreign Minister Halonen delivered the main address for Finland at a session of the UN Human Rights Committee in Geneva. She said that social rights as well as political rights should be promoted, and demanded full economic, social and cultural rights for women. In her speech, Ms. Halonen also deplored the erosion of the Middle-East peace process. She commented on the 50th anniversary of the UN Declaration of Human Rights by saying that the UN is the only global guardian of human rights. She also hoped that more funds could be allocated to the promotion of human rights.


The chairmen of the parliamentary groups of the parties in the Government decided to cut the order mandate relating to the establishment of the rapid deployment brigades by FIM 1.6 billion. The cut would be made on the share intended for the acquisition of the helicopters. In practice, this decision meant that the rapid deployment brigades adopted in the defence report would be established and they would be provided with transport helicopters but not with escort or combat helicopters.


The EU Commission decided on the outline of its agricultural budget. In principle, Finland was in favour of the Commission's proposal but the envisaged significant decrease in the price of grain and milk presented a severe threat for Finland. Referring to the correspondence between Finland and the EU on agricultural issues, Prime Minister Lipponen said that he believed that Finland would get full compensation. On 19 March, the main opposition party, the Centre Party, demanded a broad revision of the Agenda 2000 proposal. The executive board of the Centre Party insisted that Finland should not support the Commission's proposal until the agricultural problems had been solved in a manner that was binding.


The President approved the Government's proposal regarding the Schengen Agreement, and on 20 March, the Schengen Agreement was submitted for parliamentary debate. If Parliament adopts the Agreement, Finland will start to adopt the dispositions of the European passport-free zone towards 2000.


Parliament adopted the Act on the Bank of Finland, which made it possible to connect the Bank to the European Central Bank system.


Minister of Defence, Mrs. Anneli Taina, made an official visit to the US, meeting with Secretary of Defense William Cohen and other representatives of the US government. Current security issues were discussed in the meetings, including those related to the European security architecture, the Baltic region, peacekeeping operations and environmental security. Mrs. Taina also visited helicopter and submarine bases. On 30 March in New York, Minister Taina and the UN Vice Secretary-General Bernard Miyet signed a co-operation memorandum between the Government of Finland and the UN, related to readiness arrangements of peacekeeping operations. In this manner, Finland gave an official sign of its political will to participate in the development of the reaction readiness of UN peacekeeping operations.


In Brussels, Mr. Jacques Santer, Chairman of the EU Commission, and Mr. Yves-Thibault de Silguy, Commissioner for Economic and Financial Affairs, presented the Commission's proposal regarding the first member states to join EMU. Belgium, Germany, France, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland were regarded as having met EMU criteria. Britain, Sweden and Denmark opted to stay outside monetary union. According to the Commission and the European Monetary Institute, the Finnish economy was well within the EMU framework and criteria. The Commission considered Finland as ranking among the four best EMU countries by all criteria except long-term interest rates, where it ranked above average.


In a programme on current affairs broadcast by the radio station Radio Vega, Foreign Minister Halonen invited new solutions for Finnish defence and security policy. According to her, evaluating threats as primarily coming in the form of war, was an old-fashioned approach and Finland should start to consider threats other than those purely military in nature. She said that rather than a full-scale war, Europe could face threats such as local and ethnic conflicts, flows of refugees, environmental disasters and catastrophes. Ms. Halonen said that even if the notion of the new threats is commonly shared, the approach is based on old and traditional measures. She also believed that a future army would manage with a smaller number of men and women. One could therefore speculate on the idea of general service for the young, with military service being only a part of it. Military service could be undertaken by those willing to do it, while the others could be trained in other crisis management tasks.


Commissioner Joao de Deus Pinheiro of the European Union visited Finland to present the Lomé Agreement negotiated between the EU and the African, Caribbean and Pacific countries. Mr. Pinheiro said that in the coming negotiations, the EU would focus on the fight against corruption, on the status of women and on environmental issues. The Lomé Agreement will be terminated in February 2000 so Finland will be responsible for finalising the Agreement during its EU presidency in 1999.


The meeting of the EU Foreign Ministers marked the launching of a long process aiming at the accession of Cyprus and ten former Eastern-block countries. During the meeting, Foreign Minister Halonen said that she expected these accession negotiations to take longer than was the case with Finland. According to her, it would be desirable that the first new countries could join in 2005, that is, prior to the change of Commission in 2006.


President and Mrs. Ahtisaari made a state visit to Ukraine, meeting with President Leonid Kutshma. The Presidents discussed the relationship between Ukraine and Finland, the eventual impact of the Ukrainian parliamentary elections on the country's economic reform as well as the Baltic Sea - Black Sea initiative made by President Kutshma. The purpose of the initiative is to stimulate areas along the old commercial routes. Mr. Ahtisaari expressed his strong support for the initiative.


By a vote 110 for and 50 against, Parliament adopted the acquisition of transport helicopters for the Defence Forces. The Defence Forces were granted the authorisation to order FIM 6.1 billion worth of equipment for the new rapid deployment brigades being established, the helicopters accounting for FIM 2.2 billion. After the decision, Minister of Defence Anneli Taina stated that Finland would immediately launch negotiations on helicopter co-operation with Sweden.


Chief of Staff of the US Army, General Joseph W. Ralston visited Finland, meeting with Head of Defence, General Gustav Hägglund and with President Ahtisaari. During his visit, General Ralston said he was surprised by the notion that emerged in the debate over combat helicopters that the acquisition of certain armaments would ensure Finland's entry in the NATO. He pointed out that the five NATO membership criteria were a working democracy; a market economy; peace with neighbours; civilian control over the armed forces; and the compatibility of the armed forces with NATO. None of these criteria implied that a country should acquire any particular type of equipment from any particular country.


The Grand Committee of Parliament adopted a position in favour of Finland's joining the third phase of EMU as of the beginning of 1999. In the Grand Committee's opinion, participation was motivated both by economic and political reasons.


Prime Minister Lipponen and Foreign Minister Halonen participated in the summit of Asian and European countries (ASEM II) held in London. The meeting decided to establish an expert network to provide advice to the Asian countries in running their economies. Moreover, a decision was made to create a fund at the World Bank, amounting to a value corresponding to approximately FIM 200 million, which would distribute money to conduct economic research and to ease social conditions in the region. The Finnish Prime Minister said that Finland was also considering a contribution to the fund.


Prime Minister Lipponen visited Brussels, meeting with his Belgian counterpart Jean-Luc Dehaene, with President Jacques Santer of the EU Commission, as well with Commissioner Franz Fischler, responsible for agriculture in the EU. The future of agriculture in the North and the Finnish initiative regarding the Northern Dimension were among the topics discussed in the meetings. Prime Minister Lipponen said that he believed that the problems of Finnish agriculture would be taken into consideration in the new agricultural programme.


At the presidential session, a specific operative area of responsibility was adopted for the Finnish battalion in Bosnia-Herzegovina. As defined, the primary task of the battalion would be to prevent hostilities. As regards the use of force, the Finnish battalion's powers were not affected.


On behalf of the Finnish Government, Foreign Minister Halonen congratulated the Northern Ireland peace negotiators on reaching the peace agreement. According to Ms. Halonen, it was important that the parties would now launch the implementation of the agreement. The Finnish Government appreciated the fact that all principal parties to the long-lasting conflict in Northern Ireland had shown courage and had opted for a peaceful future.


In a conference arranged by the Nordic Council in Copenhagen, the Finnish Minister for European Affairs and Foreign Trade, Mr. Ole Norrback said that as the EU was expanding, the Nordic countries would also need to address the question of an eventual development towards a federal state. According to Mr. Norrback, it was an unavoidable consequence of EU reform that more and more decisions of the Union would be made on a majority voting basis and that the decisive power would be increasingly supranational. He also said that the notion of federalism met with opposition in the Nordic countries. According to Mr. Norrback, the EU institutions should be reformed at one go so that the eastern expansion of the EU would not be decelerated.


Parliament adopted a decision regarding Finnish participation in the third phase of EMU. Among the MPs, 135 voted for participation while 61 were against it.


Foreign Minister Halonen participated in a meeting with her Nordic counterparts, arranged in the Thoresta mansion near Stockholm, Sweden. During the meeting, Finland's Tarja Halonen and Sweden's Lena Hjelm-Wallén presented a joint initiative of the two countries to develop security in the Baltic region. The most significant proposal in the initiative regarded the increase of military control among the countries in the Baltic region. Finland and Sweden were prepared to open their doors to extra controls in the spirit of reciprocity, and hoped that the others would follow their lead. The initiative also contained proposals for increased co-operation in other fields, such as rescue operations and border control. This initiative was a reply to the proposal made by Russia in the previous autumn regarding the security guarantees between the countries of the Baltic Sea.


Minister of Finance Sauli Niinistö participated in the EU Ecofin meeting in Luxembourg. In the meeting, Finland took a stand in favour of the German proposal according to which the countries adhering to EMU would commit themselves to a strict budgetary policy immediately after the selection of EMU countries in early May. No unanimity could be reached on the issues relating to the persons to be chosen as the President and as the Executive Board of the European Central Bank.


Minister of Defence Anneli Taina participated in a meeting with her Nordic counterparts in Kiruna, Sweden. The Ministers stated that the European security situation on the eve of the new millennium looked bright. The factors contributing to this positive outlook included EU and NATO expansion processes, the enhancement of the PfP process and the establishment of the Euro-Atlantic Partnership Council (EAP) and the NATO-Russia council in 1997. The Ministers also considered that it was a great advantage that the European security system was to an increasing extent engaging contractually, a fact that also made it possible to intensify co-operation. In the Ministers' opinion, the intensified level of Nordic co-operation was of great importance as far as the development of the entire European security architecture was concerned. They also wanted to extend Nordic defence cooperation in the frame of NORDCAPS (Nordic Coordinated Arrangement for Military Peace Support.


In an interview with the Financial Times, Prime Minister Lipponen demanded unanimity in the appointment of the President of the European Central Bank. The Finnish Prime Minister made an appeal to the big countries, asking them to be responsible and to focus on what was best for Europe, instead of solely focusing on their national interests. He also noted that compromise in the appointment issue had to be found during the meetings to be held in Brussels during the following weekend. According to Mr. Lipponen, small countries should also be represented on the Executive Board of the Central Bank.


In a security policy seminar, jointly arranged by the Swedish-speaking Social Democrats and MEP Jörn Donner at Helsinki University, Foreign Minister Halonen said that the capacity for military co-operation between individual states also promoted European security. According to Ms. Halonen, the crisis in Bosnia had shown that non-alliance and military co-operation could be compatible in crisis management. The objective was to make the difference between military alignment and non-alliance as small as possible. She said that with the initiative regarding the Northern Dimension, Finland wanted to emphasise the role of the EU in Finland's neighbouring areas and in all Northern Europe. According to her, it is important for the security of Northern Europe that Russia be closely involved in this co-operation and that other countries also appreciate the importance of good neighbourly relations.


In an address under the title "Berliner Rede" to an audience in Berlin, Germany, President Ahtisaari said that the growing economic ties between Russia and the rest of Europe would enhance security in the continent. He said this tie was essential because the post-Cold War security order was being created in Europe. According to President Ahtisaari, foreign trade with the EU was already very important for Russia. The tie between the regions would become even closer if Western Europe's future need for imported energy could be satisfied by Russian natural gas. The President also addressed the expansion of the EU towards the East, a fact that would create a new frontier along the eastern borders of the Baltic States and Poland. He warned against the creation of a new iron curtain in Europe, and also raised the issue of the Northern Dimension proposed by Finland to the EU, recommending it as a feasible instrument for the relationships with Russia.


NATO's Deputy Secretary-General for political affairs, Mr. Klaus-Peter Klaiber, was responsible for the officer-level meeting of APAG, the NATO consultative planning group, held in Finland. According to the judgement of Mr. Klaiber, the attitude towards hypothetical membership applications by Finland, Sweden and Austria would now be positive, should the countries decide to apply for NATO membership. He said it was highly improbable such applications would be made, even if there had been some debate about this issue in Austria. The statement by Mr. Klaiber showed that there were clear differences between the non-NATO countries potentially interested in the military alliance. None of the former socialist countries in Eastern and Central Europe, actively seeking NATO membership, would receive such a flexible attitude. Not only militarily but also politically, Finland, Sweden and Austria were in a category of their own. Mr. Klaiber said that the role of the EU was as important as that of the NATO, since security today also includes economic, social and environmental issues. "Military security is just one part of it. All the rest is taken care of by the EU", Mr. Klaiber commented.


Minister of Defence Taina made an official visit to Russia, meeting with her Russian counterpart Igor Sergejev, with Foreign Minister Yevgeni Primakov and with Mr. Andrei Kokshin, Secretary of the Security Council. The issues discussed during the meetings also included Finland's proposal to invite the Russians to the "Nordic Peace" peacekeeping exercise to be organised in late 1999. Minister Taina and Minister Sergejev signed a protocol on the general framework for co-operation in military administration between the two countries. Other Nordic countries had signed corresponding documents with Russia at an earlier stage.


Visiting the Grand Committee of Parliament, Prime Minister Lipponen said he believed that the credibility of the Finnish economy would be enhanced once Finland's participation in EMU was accepted during the meeting to be held on May 1 in Brussels. Mr. Lipponen expected that the EMU decisions would also attract foreign investments to Finland. He repeated the Finnish opinion, according to which it is indispensable that decisions regarding, not only the EMU countries, but also the President and the Executive Council of the European Central Bank, should be taken on May 1.


During the French President's stopover at the Helsinki-Vantaa airport, he was met briefly by President Ahtisaari. The topics of the short meeting included Baltic co-operation within the EU and the upcoming EMU meetings.


The EU Summit held in Brussels decided to launch Economic and Monetary Union, EMU, with 11 participating countries. The toughest part of the negotiations proved to be the appointment of the President of the European Central Bank, ECB. A compromise was reached by appointing the Dutchman Wim Duisenberg on the condition that he would resign, due to his old age, in the middle of his term in 2002. Prime Minister Lipponen commented on the decision as follows: "The President was appointed for a term of eight years. The term will not be prolonged. Mr. Duisenberg has declared that he does not intend to serve a full term. In other words, in time he will vacate his post by his own free will." Finland received a post among the ECB executives as Mrs. Sirkka Hämäläinen, Governor of the Bank of Finland, was appointed as a member of the Executive Board.


In an interview in to the Finnish daily "Keskisuomalainen", the Russian Ambassador Ivan P. Aboimov said that Finland's military non-alliance promoted stability in the region. According to the Ambassador, the decision by the Finnish political leaders to remain outside military alliances was in accordance with Finland's national interests. Mr. Aboimov also reminded that Russia is unambiguously against the expansion of NATO. Any reassuring remarks, according to which the expansion of NATO would not include an anti-Russia element, were not credible according to him. Mr. Aboimov also pointed out that "no state in Europe is threatening another state."


Foreign Minister Halonen said that she considered the nuclear tests performed by India earlier that day to be very deplorable. She pointed out that the international community had given comprehensive support to the 1996 Treaty banning nuclear testing. According to Ms. Halonen, Finland insisted that all countries commit themselves to the nuclear test ban.


Prime Minister Lipponen visited Sweden, meeting with his counterpart Göran Persson. Their discussions touched on the problems between Latvia and Russia. The two Premiers pointed out that Latvia, which is seeking membership in the EU, would need the support of Finland and Sweden in its pursuit to solve the language and citizenship problems of its Russian-speaking population. Mr. Lipponen added that "it is important to pursue a joint EU policy despite the diverging EMU orientations". The two Ministers also said that the nuclear tests made by India were very regrettable.


Minister of Defence Taina and Under-Secretary of State Jaakko Blomberg from the Ministry for Foreign Affairs were the Finnish representatives at the WEU ministerial meeting in Rhodes, Greece. The Ministers expressed their concern about the Albanian development and discussed ways in which the WEU could complement the eventual operations of other international organisations vis-à-vis the Kosovo crisis. Mr. Blomberg said that Finland was in favour of strengthening the WEU's multi-national, consultative police operation in Albania. Concerning the enhancement of the WEU's operative capacity, Mrs. Taina said that Finland considered that it is important to develop EU-WEU co-operation in accordance with the Amsterdam Treaty of 1997. She added that Finland supports the co-operation between NATO and the WEU which is aimed at enhancing the WEU's operative capacity as the European organisation for crisis management.


Foreign Minister Halonen said that Finland profoundly deplored the fact that India had performed two more nuclear tests in addition to the three recent tests. In concert with the international community, Finland demanded a declaration from India to the effect that it would not continue its nuclear tests and that it would adhere to the international Treaty banning nuclear testing. Ms. Halonen also made an appeal to the other states in the region so that they would show extreme moderation as regards the Indian explosions, to prevent an escalation of an arms race.


Foreign Minister Halonen gave a statement on the Indonesian situation, saying that she was very concerned about the Indonesian demonstrations being repressed by force. According to her, the Indonesian government should intervene and investigate the deaths and the allegations about people disappearing and being tortured. Those guilty of such deeds should be made to answer for them. Finland made an appeal to the Indonesian authorities for the respect of the rights of individuals and the freedom of expression and assembly, as well as for abstaining from the use of violence.


In an event marking the 15th anniversary of the Association of Correspondents on Foreign Affairs arranged in Helsinki, President Ahtisaari said that an increase in military co-operation had played a key role in leading Europe, with its long history of division, towards new co-operation. According to President Ahtisaari, crisis prevention and management are the most important aspects of the new co-operation in Europe as far as both military and civilian issues are concerned. The President said he was very much hoping that his idea of a summit of the three big powers - the EU, the US and Russia - would materialise during the Finnish presidency of the EU in the latter half of 1999.


In an interview to the daily Helsingin Sanomat, Doctor Tomas Ries, Special Researcher at the National Defence College, said that as a result of a thorough change in the European security environment, Finland is facing a fairly problematic situation. According to him, the problem is that of maintaining both military non-alliance and an independent and credible defence. In his view, Finland could no longer compromise over the conscription service since the defence of a large country called for large reserve forces. However, Finland also needs a larger elite group of forces than exists today for tasks that cannot be assigned to conscripts. These are expensive operations, and the challenges cannot be met with the present defence budget. According to Doctor Ries, Finland really has no choice "unless the country decides to ally in one way or another."


Foreign Minister Halonen met in France with her French counterpart Hubert Védrin. During the discussions, Ms. Halonen said that Finland was prepared to discuss any type of development of the EU Commission, but the country absolutely will not give up its Commissioner post. According to Ms. Halonen, Finland is prepared to develop the EU's common foreign and security policy which, in her conviction, will develop and become operative through hard and consistent work.


The Polish President Aleksander Kwasniewski, accompanied by Foreign Minister Bronislaw Geremek and Integration Minister Ryszard Czarnecki, made an official visit to Finland, meeting with President Ahtisaari and Prime Minister Lipponen. In a speech given at the Paasikivi Society, President Kwasniewski made a strong appeal to international financial institutions to support the reforms underway in Ukraine, which is presently struggling with economic difficulties. He was convinced that Poland will continue to address Ukrainian issues, once the country is a member of the EU. In President Kwasniewski's view, the Polish initiative regarding the "Southeastern Dimension" supports the Finnish initiative on the Northern Dimension.


The Spanish Foreign Minister Abel Matutes visited Finland, meeting with President Ahtisaari, Prime Minister Lipponen and Foreign Minister Halonen. During the discussions, he expressed Spanish concerns for the status of the Mediterranean within the EU. Disquieting factors included; breaches in co-operation among the Mediterranean countries, decreasing EU aid, and the imbalance between the North and the South in EU aid policy. Despite the latter problem, Mr. Matutes expressed his full support for the development of the Northern Dimension advocated by Finland.


In Brussels, the EU Prime Ministers agreed upon the rules for arms exports. According to the agreement, the Member States will not export arms to countries with an on-going armed conflict within the country or with neighbouring countries, nor to countries which violate human rights. Ms. Halonen said that the new rules did not have any major effect on Finnish arms trade since Finland already applied stricter arms export criteria than most other EU countries.


The Ministers of Defence of the Nordic and Baltic countries were gathered in Oslo, Norway, for their fifth summit. The Ministers underlined the importance of Baltic security for the whole of Europe. They also addressed the security of the rest of Europe, including issues such as the expansion of NATO, the Partnership for Peace arrangement and the renewal of the CFE (Conventional Armed Forces in Europe) agreement. The Norwegian minister, Mr. Jostein Fjaervoll, told the meeting that his country's UN troops would be withdrawn from the Lebanon during the year. They would be replaced by the so-called "Baltbat" troops, or Baltic peacekeeping forces established through Nordic training assistance. The Nordic countries promised they would continue to support the development of the defence capability of the Baltic countries but they also welcomed other outside help.


As a reply to the hydrogen bomb test performed by India on 11 May, Pakistan detonated five nuclear charges. Foreign Minister Halonen commented on the incident by saying she was sorry and disappointed.


The Argentine President Carlos Menem made an official visit to Finland, accompanied by a large business delegation intending to create trade relations with Finland. The discussions between President Menem and President Ahtisaari were also attended by Foreign Minister Guido di Tella and his Finnish counterpart, Ms. Halonen. Bilateral relations and regional issues were the main topics addressed. During the discussions, President Ahtisaari presented a formal request to investigate the fate of Finnish citizens who had disappeared in 1977 during the Argentine military regime.


The Russian Foreign Minister Yevgeni Primakov made an official visit to Finland, meeting with President Ahtisaari, Prime Minister Lipponen and Foreign Minister Halonen. The topics discussed by the two Foreign Ministers included Finnish-Russian bilateral issues, the situation in Europe and the nuclear tests carried out by Pakistan. Mr. Primakov said Russia supported Finland's initiative regarding the EU Northern Dimension. In his judgement, this initiative would facilitate co-operation between the North West of Russia and Finland and other countries. Both Mr. Primakov and Ms. Halonen urged Latvia to meet the international recommendations regarding the treatment of minorities but failed to agree on whether the legislative bill presented by the Latvian government on the amendment of the citizenship law was sufficient to comply with the recommendations of the OSCE. According to Ms. Halonen, the measures taken by the Latvian government were sufficient.


After hearing the leaders of the parliamentary groups, the Speaker of Parliament, Mrs. Riitta Uosukainen decided that the Finnish Parliament would become an associate member of the NAA, the parliamentary assembly of NATO.


The Foreign Affairs Committee of Parliament gave a statement expressing their dissatisfaction with the manner in which foreign policy leadership was formulated in the Government proposal for the new Constitution. The Committee would like to clarify the bill so that the Council of State would have the final say in controversial situations. In the Committee's view this shortcoming should be eliminated through a reference to article 2 (58) on presidential decision-making. The general rule of that article is that "the President of the Republic takes his/her decision at the Council of State upon the proposal of the latter." The Committee was strongly questioning the notion according to which presidential leadership in foreign policy would be necessary from the point of view of decision-making during times of crisis. Instead, it was important for the Committee that in a developed civil society, "foreign policy power should not be excessively concentrated".


The Ministers of Finance of the 11 EMU countries met in Luxembourg to establish the Euro-11 Council, one of the major tools for the outlining of European monetary and economic policy. The formal decision to establish the Council had been taken in late 1997. The Ministers defined the tasks of the Council, which is designed to work alongside the Ecofin council. The Euro-11 is expected to become the place where the actual decisions on the economic, fiscal and budgetary policies of the EMU countries will be made. The non-official Council will meet once a month. France, in particular, insisted that the Council have close contacts with the European Central Bank. The countries remaining outside EMU (Britain, Sweden, Denmark and Greece) would occasionally be invited to the meetings.


Tony Blair, the Prime Minister of Britain (the current President of the EU) made a brief visit to Helsinki to talk about the agenda of the Cardiff Summit with President Ahtisaari and Prime Minister Lipponen. According to Mr. Blair, the western countries were discussing various options for resolving the Kosovo situation, including a military option. In a separate interview, Mr. Lipponen said that a military operation alone would not solve the Kosovo crisis. NATO troops might be needed in Kosovo, but such a decision would require the support of the UN and Russia. According to Mr. Lipponen, a NATO peacekeeping operation should be part of a comprehensive solution. He clearly distanced himself from unilateral punitive operations, saying that the air attacks suggested by Mr. Blair could be interpreted in such a way.


The EU Foreign Ministers meeting in Luxembourg decided to prohibit all new investments to Serbia, a part of the Federal Republic of Yugoslavia (FRY). The investment ban was made in protest against the recent attacks by the Serb security forces against the ethnic Albanian population in Kosovo. The EU urged other organisations, NATO and the UN, to continue their efforts to restore peace, and to consider all necessary action, including military intervention. The Ministers strongly condemned the operations of the FRY and expressed their fear that the attacks may constitute a new wave of ethnic purges. Moreover, the EU also condemned the violence used by the Kosovo Liberation Army, KLA, the organisation seeking independence for the province, which was another party to the dispute. The EU was in favour of extensive autonomy being granted to the Kosovo province within the FRY and supported the efforts by Kosovo's Albanian president, Mr. Ibrahin Rugova, to reach peace through negotiations. Mr. Ole Norrback, Finland's Minister for European Affairs and the country's representative at the summit, said that it was time international organisations used force. He also considered the ban on investment to be an indispensable action.


The Information Officer of the Materials Institute of the Swedish Armed Forces, Mr. Lars Wigert stated that, contrary to an earlier position, Sweden was pursuing the option of acquiring transport helicopters in collaboration with Finland, as well as with Norway and Denmark. Through collaboration over the helicopter issue, Sweden was hoping to achieve cost reductions. Among the first practical measures needed to establish such co-operation, Wigert stated it is necessary to create a co-operative body.


On a visit to Lebanon, President Ahtisaari said he thought it was excellent that defence co-operation among the Nordic countries had started to intensify. President Ahtisaari was convinced that a joint acquisition would mean decreased costs and would eventually give Finland a chance to provide maintenance services for neighbouring countries. Speaking at an event commemorating the 80th anniversary of the Ministry of Defence, Minister Taina said that Nordic co-operation was a positive thing. She said it was part of the internationalisation process which had characterised the development of the Ministry of Defence throughout the '90s. Mrs. Taina pointed out that the major present and future task of the Ministry was to engage in international co-operation in defence policy.


On their visit to Portugal, President and Mrs. Ahtisaari also visited the Lisbon Expo 98 World Exposition. Meeting with Prime Minister Antonio Guterres, the President discussed Finland's strong economic relationship with Indonesia. Mr. Guterres did not disapprove of these relations but considered that "now is also the right moment to utilise such economic relationships to press Indonesia to develop its internal democracy and to solve the situation in East Timor."


Parliament began the debate on the adoption of the Schengen Agreement regarding free mobility within the EU, as well as on the Amsterdam Treaty, dealing with the expansion and structural reform of the EU. The two documents, now in their third reading, were adopted on 15 June by votes of 110 to 4 and 119 to 3, respectively.


Minister of Defence Taina participated in the meeting of NATO and the Euro-Atlantic Partnership Council, EAPC, held in Brussels. She said that Finland was not taking part in peace enforcement operations in Kosovo but that it would participate, for example, in police operations. In turn, Prime Minister Lipponen said in Helsinki that Finland could take part in an eventual peacekeeping operation in Kosovo. According to Mr. Lipponen, Finland would not, however, participate if Kosovo were to be attacked by military force under NATO's leadership. It is a condition for Finland's participation that crisis management has the consent, not only of Parliament, but also of either the UN or the OSCE. However, Mr. Lipponen said that should Finland send troops to Kosovo, the contribution would be a modest one. He underlined that Finland has not given any prior consent to a military operation.


The Ministers of Defence of Finland and Sweden, Mrs. Anneli Taina and Mr. Björn von Sydow published a joint article in the dailies Helsingin Sanomat and Dagens Nyheter. In their article, they named five areas in which defence co-operation between the two countries could be developed: co-operation in defence materials; a combined coastguard; participation in joint crisis management exercises; the exchange of officials; and intensified teacher, student and research exchanges. The Ministers emphasised that military non-alliance was a means, not a goal, and not necessarily the status quo. The two countries insisted on their right to decide upon the contents and form of political and military co-operation currently being developed in Europe.


At the Congress of the Swedish-speaking Party held in Tuusula, the Party Vice President and MEP Astrid Thors said that the common foreign and security policy of the EU countries would become significantly more concentrated over the next ten years and that the issue of joining the EU and the WEU would have to be solved sooner or later. In the June 16 issue of the daily Helsingin Sanomat, Under-Secretary of State Jaakko Blomberg of the Department of Political Affairs at the Ministry for Foreign Affairs, rejected the vision of Mrs. Thors. According to him, the common defence policy as referred to in the Maastricht and Amsterdam Treaties, meant military co-operation in crisis management and co-operation in defence materials issues, where many steps have already been taken. Mr. Blomberg said that in addition to crisis management, defence policy would not be concentrated anywhere. He also said that is was not feasible to create another defence system aligning and overlapping NATO. The political force of NATO is backed by the US, and without the US, the pressure of the European countries would not be sufficient. Mr. Blomberg also rejected Mrs. Thors' proposal to reconsider the principles of Finnish peacekeeping policy.


President Ahtisaari and Prime Minister Lipponen participated in the EU Summit in Cardiff. The meeting decided that the EU Heads of State would hold three extra meetings during the year to elaborate on the reform of the institutions, agricultural policy and financing of the Union. The EU also committed itself to providing more information for its citizens about its decision-making and to assigning decisions to the national and regional levels. The negotiations on the constitution of the Commission and the number of votes at the Council would be started towards the beginning of the new millennium. It was also decided that the Vienna Summit to be held towards the end of the year would establish the office of a Foreign Policy Speaker at the Council. President Ahtisaari proposed to the Heads of State of other EU countries that a meeting of the three big powers, i.e., the EU, the US and Russia, be arranged immediately after the EU Summit during the Finnish presidency. In his own address, Prime Minister Lipponen expressed his strong support for the operation of the internal market, proposing that the subvention and other protective structures be decreased.


Foreign Minister Halonen led the Finnish delegation at the five-week diplomatic conference in Rome. On July 17, the UN member states adopted a resolution to establish a permanent international war crimes court (International Criminal Court) which would focus on cases such as genocide, war crimes and crimes against humanity. Delivering the official Finnish address on 17 June, Ms. Halonen noted that the International Criminal Court was a priority for Finland and that the country would actively and strongly support its operation.


In an interview with the semi-weekly "Nykypäivä", Minister of Defence Taina said that a consultative referendum should be arranged on the eventual question of Finnish membership in NATO. Mrs. Taina pointed out that it was advisable to address the issue of a referendum because of repeated hints of the existence of some kind of conspiracy to get Finland into NATO.


The EU Ministers of the Environment met in Luxembourg to negotiate the containment of the greenhouse phenomenon on the basis of the resolutions made at the Kyoto Convention on Climatic Change. The problem was how to allocate the objectives among the countries. At the meeting, Finland committed itself to reducing its climatic emissions to the 1990 level over a period of about 10 years. This has already been achieved by modifying the 1990 statistics which were the basis for the comparisons. In other words, the figures for the reference year were increased by some ten percent. Mr. Pekka Haavisto, Minister of the Environment, said that Finland would commit itself to these objectives on the condition that the Union started to actively implement community-level measures, such as energy taxes.


President Ahtisaari visited the European Parliament in Strasbourg. In his speech, he called for a strong and efficient Union and hoped that EU decisions would increasingly be made on a qualified-majority basis. According to President Ahtisaari, the demand for unanimity in foreign policy decision-making had lead to a situation where visible results were only rarely seen. He hoped that the EU would develop its military dimension for conflict prevention and crisis management purposes. According to him, "only a Union that is effective and treats its external relations as a totality can function in a way that accords with the new broadly-based concept of security." Mr. Ahtisaari said that the EU could be facing such challenges from its northern areas, including those behind Finland's eastern border. He said that in view of these challenges, the Union needs to establish a Northern Dimension, managed as efficiently as the southern dimension through the Barcelona process.


President Ahtisaari decided that Finland would continue to participate in the UN peacekeeping operation, Sfor, after the Cabinet Finance Committee had on 17 June decided to recommend exceeding the estimated appropriation for the Sfor project. It was estimated that this would increase government expenditure by a total of FIM 98 million.


NATO's Secretary-General Javier Solana visited Finland on his tour of all 28 countries participating in the Partnership for Peace programme. In Helsinki, he met with President Ahtisaari, Foreign Minister Halonen and Minister of Defence Taina. The main topic in the discussions was the Kosovo crisis. Mr. Solana wanted to promote the agreement made by the Yugoslavian leader Slobodan Milosevic and the Russian President Boris Yeltsin on 16 June in Moscow.


The Tibetan leader, the Dalai Lama, visited Finland, meeting with Minister of Culture Claes Andersson. Mr. Andersson said that the EU was preparing a new Tibet policy which would also help to clarify the Finnish position. He said that the problem from the Finnish Government's point of view was that China was recognised as a unitary state, and therefore it was difficult to officially receive the Dalai Lama, since China did not approve of moves toward Tibetan independence.


The UN Under-secretary General and Special Bosnia Envoy, Mrs. Elisabeth Rehn, said in Helsinki that the time had come to resort to force in Kosovo. According to Mrs. Rehn, such measures should, however, be taken only after a resolution by the UN Security Council, and by using NATO forces. Contrary to the opinion of Russian President Yeltsin, Mrs. Rehn said that human rights were not an internal affair of any country.


During the meeting of the Nordic Prime Ministers in Malmö, Sweden, the issue of the Barsebäck power plant was discussed. Prime Minister Lipponen said he was surprised by the stand adopted by the EU countries, according to which countries giving up nuclear power would be granted reductions to their emission limits. Mr. Lipponen found it odd that Sweden, for example, would be allowed to increase its sulphur emissions through the replacement of nuclear power with fossil fuels. Mr. Lipponen hoped that the Kyoto resolutions would be complied with through a common policy, and that such a general outline would also be agreed upon within the EU.


The implementation of the agreement of visa freedom between Finland and Croatia was suspended because several illegal immigrants carrying Croatian passports had recently entered the Nordic countries under visa freedom. Finland thus followed the pan-Nordic policy of containing illegal immigration.


Speaking at a traditional event in Halikko, Finland, organised by immigrants from the former Finnish-Karelian village of Uusikirkko, now in Russian territory, the Commander of the Kymi Military Province, Brigadier General Kari Hietanen said he was surprised by the attitudes of the Finns as regards the restitution of Karelia, considering the significance of the Karelian Isthmus to defence policy. According to the General, hopes for the restitution of Karelia should not be lost. Neither did he see any problem in relocating the approximately 250,000 Russians presently living in Karelia, to other parts of Russia. The General said that "to a large extent, it is a question of the will to redress the wrongs of history". General Hietanen underlined that the restitution of Karelia was an issue between Finland and Russia, the two parties involved.


The European Bank for Reconstruction and Development, EBRD, and the Russian State signed a secondary guarantee agreement relating to the FIM 400 million loan appropriated for the development of the St. Petersburg water supply system. Most of the funding will be used for the improvement of the water supply and sewage network in the St. Petersburg area, which would reduce the city's emissions to the Baltic Sea. Besides the water supply authority, the parties involved in the funding of the first stage included the EBRD, NIB, NEFCO, Finland, Sweden, Denmark, Germany, Great Britain and Belgium. The Finnish contribution amounted to FIM 25 million.


German Foreign Minister Klaus Kinkel visited Finland, meeting with President Ahtisaari, Prime Minister Lipponen and Foreign Minister Halonen. The purpose of Mr. Kinkel's visit was to ensure that the transfer of the EU presidency from Germany to Finland in July 1999 would be smooth. He said that during its presidency, Finland would be facing problems related to Agenda 2000, the Union's agricultural and financial package, the question of Turkish membership of the Union, and the crisis in Kosovo. Other topics touched upon during the visit included the objectives of institutional reform, the Northern Dimension of the EU and required co-ordination improvements to the Union's Russia policy.


Latvian Premier Guntars Krasts made a working visit to Finland, meeting with Prime Minister Lipponen and Minister for European Affairs, Mr. Ole Norrback. Latvia's eventual membership in the EU, Baltic co-operation and Fenno-Latvian economic relations were among the topics discussed. Minister Krasts also acquainted himself with the operation of the Finnish Frontier Guard at Finland's eastern border.


Belgian Premier Jean-Luc Dehaene visited Finland, meeting with Prime Minister Lipponen and Minister of Finance Niinistö. During his visit, Mr. Dehaene underlined the importance of the efficient operation of EU institutions. He added that it was also important to safeguard the influence of the small countries in the EU decision-making process. Mr. Dehaene expressed his support for Finland's Northern Dimension initiative. The two Prime Ministers agreed that the cost of the eastward expansion of the Union should be maintained at reasonable levels.


According to the results of a poll by the research institute Taloustutkimus Oy, the Finns were almost evenly divided as to their attitudes towards membership in the EU and EMU: 47 % of the Finns approved of the EMU decision while 40 % were against. As regards membership in the EU, 46 % were positive and 46 % were negative, whereas 56 % of the Finns were against eventual NATO membership and 28 % were in favour.


In an open letter sent to Brigadier General Kari Hietanen, Lieutenant-General Matti Kopra, Substitute for the Chief of Defence, disapproved of the General's speech in Halikko dealing with the restitution of Karelia. He said that it was not the Defence Forces' business to draw up foreign and security policy outlines. The Russian Embassy was also interested in the comments made by General Hietanen. Minister Ole Norrback, substituting for the Minister for Foreign Affairs, explained to Russian Ambassador Aboimov that the remarks by General Hietanen did not represent Finland's official views. On 30 July, President Ahtisaari also intervened, saying that Finland's official view was clear as regards the restitution of Karelia. "The official view imposes certain restrictions on official representatives, be they diplomats, cabinet ministers or generals, as to how they should behave." However, President Ahtisaari said it would be strange if the debate on Karelia did not continue.


The Estonian Premier Mart Siimann met in Helsinki with his Finnish counterpart. In the discussion between the two Ministers, Mr. Siimann expressed Estonia's support for the Finnish initiative regarding the Northern Dimension. He was convinced that the initiative would also be beneficial to transport through Estonia. Other EU issues, the situation in Russia as well as bilateral questions were also touched upon.


The President of NATO's Military Committee, Mr. Klaus Naumann, said in Mikkeli, Finland, that he saw no problems as regards Finland's eventual membership in NATO. In his opinion, it is every country's own business whether it is in favour of or against membership. He also said that co-operation with Finland could also continue without membership; the co-operation within the PfP framework had been working smoothly. Mr. Naumann said that it would be best to keep the situation unchanged if the majority of Finns preferred non-alignment over membership.


In a measure to increase trust and security, Russia implemented Open Skies control flights in Finland: the corresponding flights over Russia had been performed by Finland between 22-26 June.


President Ahtisaari visited Latvia, meeting with President Guntis Ulmanis. Besides bilateral relations between the two countries, the discussion topics included the Latvian citizenship issue, Latvia's preparations for EU membership negotiations, and the Finnish EU presidency as well as European security arrangements. President Ahtisaari said that it was extremely important for Finland that the Baltic countries develop into a prosperous and politically stable region. According to Mr. Ahtisaari, the new citizenship law adopted by the Latvian parliament complied with both the EU and the OSCE basic requirements for the treatment of minorities.


Four development co-operation organisations - the Finnish Unicef Committee, the Finnish Red Cross, Finnish Church Aid and the Finnish Service Centre for Development Co-operation - demanded that the Government increase the appropriation to development co-operation by FIM 350 million. The organisations pointed out that the Government had made a commitment to increase the appropriation to 0.4% of GNP. The current percentage was 0.35%, and the 350 million increase would raise it to 0.38%. They also pointed out that according to a decision of a principle adopted in 1996, Finnish development aid was supposed to increase to 0.7% of GNP. During its budget talks, the Government decided to increase development aid to FIM 120 million as of 1998 which would maintain the respective proportional share of GNP at the current level, or at about 0.34%.


In an interview with the Swedish-language daily Hufvudstadsbladet, Special Researcher Tuomas Forsberg of the Finnish Institute of International Affairs said that the NATO and Karelia issues had not yet been resolved. In his view, the revision of frontiers in the parts of Karelia which were surrendered to the Soviets during the last war could not be excluded if Russia were prepared to negotiate on such an issue. Mr. Forsberg said that the two issues differed in the sense that Finland alone determined the NATO question while in the other issue - the surrendered parts of Karelia - Finland depended on the Russian standpoint.


Foreign Minister Halonen expressed her satisfaction that the Geneva disarmament conference had on 11 August decided to start negotiations on an international treaty to ban the production of materials compatible with nuclear weapons. She said that after the nuclear tests made by India and Pakistan in May, it was important that the international arms control dialogue continues. According to Ms. Halonen, the launching of the negotiations was an important step in promoting nuclear disarmament and enhancing the nuclear non-proliferation system.


The President of Tanzania Benjamin Willian Mkapa, accompanied by his wife and a delegation, visited Finland and met with President Ahtisaari and Minister of Development Co-operation Haavisto. The topics of the discussions included development co-operation questions, issues related to crises, democratisation and human rights in Africa, as well as Euro-African relations. The relationship between Finland and Tanzania, traditionally focused on development aid, should be made more versatile. President Ahtisaari and Minister Haavisto took the occasion to offer their condolences to the families of the victims and to offer their sympathy to those injured in the bomb attacks in Dar-es-Salaam, the Tanzanian capital.


Foreign Minister Halonen commented on the US air strikes in Afghanistan and Sudan, saying that the US Embassies in Nairobi and Dar-es-Salaam had been an object of terrorist attacks. According to Ms. Halonen, Finland condemned terrorism. She said that the US air strikes on 21 August in Afghanistan and Sudan had shown how difficult it was to fight international terrorism. The US had resorted to force when it had considered that international measures were not sufficient to protect its own citizens. Minister Halonen added that international anti-terrorism agreements should be implemented and the search for efficient measures to fight terrorism should be continued. Terrorism should not remain unanswered.


The Department of Development Co-operation of the Ministry for Foreign Affairs, granted a FIM 3 million additional appropriation to help Kosovo refugees. It also granted the same sum in humanitarian aid for the victims of the civil war and famine in Sudan.


Norway's Minister of Defence Dag Jostein Fjaervoll visited Finland, meeting with his Finnish counterpart. The potential combined acquisition of helicopters by all the Nordic countries were discussed by the two Ministers. Co-operation with Sweden or an independent acquisition would be the other two possibilities for Finland. The combined expert studies on the issue would continue. So far, Norway had not made any political decision on the new helicopter acquisitions.


The Nordic Foreign Ministers met in Västerås, Sweden, with the participation of representatives from Estonia, Latvia, Lithuania and Russia. On the eve of the meeting, the Swedish Foreign Minister, Mrs. Lena Hjelm-Wallén, proposed that the participation of the Baltic States and Russia in the meetings of the Nordic Foreign Ministers should be the rule in the future rather than the exception. According to her, the Nordic countries not only followed developments in the Baltic countries but would also make initiatives regarding the region. In a joint communiqué, the Foreign Ministers expressed their concern over the increase in terrorism. However, they did not express any direct support for the recent US strikes in Sudan and Afghanistan.


Foreign Minister Halonen commented on the initiative related to jurisdiction in the case regarding the Lockerbie terrorist attack. She said that Finland hoped that Libya would accept the proposal made by the UK and the US according to which a Scottish court, consisting of three professional judges, would try the case on neutral ground in Holland.


In his speech delivered at a reception arranged by the Ministry for Foreign Affairs on the occasion of the meeting of Heads of Finnish foreign representations, President Ahtisaari said that the economic and political crisis in Russia had deteriorated. According to him, "Russia needs political determination to continue the reform policy with the inherent painful decisions." President Ahtisaari also said that Finland's membership in the EU had given a more global dimension to Finnish foreign policy, meaning that Finland also had to be aware of what was going on outside Europe. He added that Finland's participation in the future EMU area had already had a stabilising effect for Finland. President Ahtisaari here referred to the stability of the Finnish currency vis-à-vis the weakening of the other Nordic currencies. Finally he also expressed Finland's concern over the spreading of the Kosovo crisis. According to the President, the crisis showed how difficult it still is to create shared and efficient measures of crisis management.


The Cabinet Foreign Affairs Committee discussed a report by a working group of Ministry officials regarding the current status of the anti-personnel mine question. The Committee decided that Finland would continue the studies on the controversial issue. It adopted three objectives for future work. Firstly, Finland would continue its active participation in international co-operation in line with the stand adopted. This would apply both to the total ban objective and to de-mining co-operation. Secondly, Finland would also contribute to the promotion of co-operation among the EU countries in this issue. Finally, surveys would be continued, both as regards Finnish conditions for joining the total ban on anti-personnel mines, and for ways to replace the landmines by using other methods and systems. The objective would be to consider the introduction of replacement methods and systems by the rapid deployment brigades by the year 2001. Finland would contribute to the international, humanitarian de-mining operations through a FIM 120 million programme between 1998 and 2001.


President Ahtisaari assessed the situation in Russia and the status of President Yeltsin after the country's most recent government crisis by saying that Russian development did not depend on one single person. Mr. Ahtisaari said that he did not think the transition from a command economy to democracy would be rapid in any country. He said that the Russian situation was severe mainly for the Russians themselves since the price increases were affecting their basic subsistence.


An appropriation of FIM 3,534 million was proposed for Foreign Affairs, up FIM 238 million, or 7 %, from the 1998 budget. The focus on the Government's objectives in foreign and security policy remained unchanged: to promote stability in Finland's neighbouring areas and to develop a security system based on co-operation. The appropriation proposed for Defence was FIM 9,028 million, a FIM 1,083 million decrease from the 1998 budget. Defence accounted for 4.81 % of the budgeted expenses while the corresponding share in 1998 had been 5.36 %.


Foreign Minister Halonen said that the prolonged Russian crisis gave reason for concern, adding however that experience had shown that prudence and a "certain lack of colour" in attitudes towards Russia could lead to the best results. She said that she would be more concerned if "for some reason, the rules were not being followed in Russia." According to Ms. Halonen, the Russian crisis would make it more difficult to try to end the violence between Serbs and ethnic Albanians in Kosovo. Moscow had been in a good position to attract the attention of the Serbian Government in Belgrade, but now the attention of Moscow was being drawn elsewhere.


At the annual UKK Forum, a meeting held in honour of Finland's late President Urho Kalevi Kekkonen, and arranged by the Paasikivi Society at the House of the Estates in Helsinki, Prime Minister Lipponen spoke about continuity and change in Finnish foreign policy. He gave President Koivisto full credit for the successful foreign policy exercised by Finland under his leadership during a period of transition in Europe. Mr. Lipponen underlined the importance of co-operation and continuity in relations with Russia. According to the Prime Minister, Finland hoped that Russian reform policy would continue despite the crises. The eventual solutions would be an internal Russian affair. Mr. Lipponen promised that during its EU presidency, Finland would focus on the development of co-operation between the EU and Russia. He said that both the increased integration of the EU and the launching of the final phase of EMU had been appropriately timed to generate more stability in Europe, counterbalancing the instability prevailing in the eastern parts of the continent. The Prime Minister said that Finland would follow its line of non-alliance in security policy. According to him, this line not only meant stability but it also gave Finland freedom of choice.


The EU Foreign Ministers met in Salzburg, Austria, to discuss the Russian situation. In her introductory address, Foreign Minister Halonen said that the Russian situation was "difficult but by no means surprising." She said that the economic problems should not be excessively dramatised. According to their joint statement, the Foreign Ministers were convinced that Russia would not return to a command economy but would try to create a working market economy. The meeting also decided to send the "Troika", or the Foreign Ministers of Britain, Austria and Germany, to Moscow to discuss the economic crisis. The group would go to Moscow once Russia had set up a working government. In their Russia statement, the Ministers emphasised the political dimension of the Russian crisis, saying that no more monetary support would be given until the political problems had been solved. They insisted that economic reform be implemented in a manner that would also take into account the social dimension or the impact on the people.


The Swedish-language daily Hufvudstadsbladet interviewed General Gustav Hägglund, Chief of Finnish Defence Forces on the occasion of his 60th birthday. General Hägglund said that the Russian situation called for extreme attentiveness, both in the present and in the near future. According to him, the recent events in Russia were of an internal nature and had not caused any foreign policy operations. General Hägglund did not consider it necessary to increase readiness in Finland, unless the situation escalated into civil war. He said Finnish military non-alliance would be clear and tenable if the country took care of its independent defence, pointing out that non-alliance included the option of NATO membership.


The Governor of the Russian region of Murmansk, Mr. Yuri Yevdokimov, asked for food aid from the Nordic countries because there was no food in the grocery stores due to the Russian economic crisis. The request for assistance was directed to the members of the Barents Regional Council. On 7 to 8 September, Minister for European Affairs Norrback visited Murmansk. He said that it was an exaggeration to speak about a food shortage, although enormous price increases had left many people in a sad plight. According to Minister Norrback, efforts should be made to restart commerce not only in Russia but also between Finland and Russia. In Murmansk, he discussed the possibility of commencing a temporary barter trade. According to Minister Norrback, Finland was going to contact Sweden and Norway, with the intent of establishing an expert group to be sent to Murmansk to study the need for help.


Iceland's President Olafur Ragnar Grimsson visited Rovaniemi, Finland, and participated in a seminar arranged by the University of Lapland on research and teaching in the North. President Grimsson said that it would perhaps be easier to include Russia in the European security structures through the channels of the North-European countries than through the traditional, continental European channels. He said that the Finnish initiative on the EU Northern Dimension was one of the most important openings in international policy recently. During his visit, President Grimsson also met with President Ahtisaari in Helsinki.


During one of his visits to the Finnish provinces, President Ahtisaari said in Hämeenkyrö that the impacts of the Russian crisis should neither be exaggerated nor belittled. According to him, Russia was looking for a solution strictly in line with its constitution, and the security policy situation of neither Finland nor the Baltic countries had changed. President Ahtisaari said that when necessary, Finland, together with the EU, would be obliged to help Russia.


Prime Minister Lipponen discussed the Russian situation in Parliament. According to him, Russia was undergoing a political and economic crisis "which at its worst can deteriorate into a state of social ferment." In Prime Minister Lipponen's view this was a serious question. The major concern for Finland was to see how the Russian food situation would develop. The Russian situation was also a security policy issue for Finland. According to the Prime Minister, the Government was also keeping an eye on the eventual moves of the military forces in Russia. He added that the direct impact of the Russian crisis on Finland would not justify any fundamental changes in the Finnish budget for 1999. However, he said it was possible that the joint impact of the economic crises in Russia, South-East Asia and Japan would lead to a period of slower growth in the world economy, with its eventual consequences on the Finnish economy. Prime Minister Lipponen also said to Parliament that Finland would be prepared to give assistance if Russian domestic production, which played a major role in the country's food supply, collapsed and the Russian authorities asked for help.


French Premier Lionel Jospin visited Finland, accompanied by his Minister for European Affairs, Mr. Pierre Moscovic and the Assistant Minister for Industrial Affairs, Mr. Christian Pierret. Mr. Jospin met with President Ahtisaari and Prime Minister Lipponen, discussing with them topics such as the world situation, the EU's Northern Dimension, the Russian situation as well as Finnish-French co-operation in information technology. France would be willing to supply transport helicopters to Finland. As counter trade, France could provide opportunities for the Finnish information technology industry. The two countries produced a joint declaration on information technology, with an aim to increase co-operation in this field. Co-operation in the defence and aviation industries was also discussed. Prime Minister Lipponen said that Finland was interested in participating in European co-operation in the arms industry, both civilian and military.


The Department for International Development Co-operation of the Ministry for Foreign Affairs, granted FIM 4 million to the Finnish Red Cross, to be used for buying medicine and food for institutions and hospitals in Finland's neighbouring areas. Moreover, the Department gave FIM 1.5 million to Finnish Church Aid for operations in Murmansk, Karelia, Vyborg and St. Petersburg.


Thirty-seven Finnish observers participated in the electoral observation operations arranged by the OSCE on the occasion of the elections in Bosnia-Herzegovina, in which the Presidents and Parliaments of Bosnia-Herzegovina and its Serb Republic were elected. The previous year's municipal elections were also repeated in certain municipalities. Moreover, three Finnish officials had been engaged in electoral preparations under the auspices of the OSCE since the previous spring.


Foreign Minister Halonen visited Hong Kong, Macao and Beijing. In Hong Kong, she was mainly interested in Hong Kong's post-transition development and the human rights situation in the region. In Beijing, Ms. Halonen met with the Chinese Foreign Minister Tang Jiaxuan, and with the country's Vice President and Vice Prime Minister. The topics of the negotiations included bilateral relations, co-operation between Finland and Russia in neighbouring areas, the situation in China, co-operation between the EU and China as well as current UN issues, and disarmament. In China, Ms. Halonen also met with the Minister of Justice, the President of the Supreme Court, as well as with representatives of minority bodies, her interlocutors in the discussions on human rights and minority issues as well as on judicial co-operation between China and Finland.


The South-African Vice President, Mr. Thabo Mbeki visited Finland, meeting with Prime Minister Lipponen, among others. Following their discussions, they pointed out that, due to the upcoming Finnish presidency of the EU, the relationship between Finland and South Africa had become closer. Finnish development co-operation in South Africa would continue - FIM 50 million had been allocated by Finland to selected objectives in South Africa. Prime Minister Lipponen said that Finland was interested in the situation in the Congo and other countries in southern Africa. He added that Finland was prepared to "engage in co-operation, mainly as a trainer of observers and peacekeeping officers."


During the "Common Environment" Forum arranged in St. Petersburg, Minister of the Environment Haavisto and the Mayor of St. Petersburg, Mr. Vladimir Yakolev, adopted a five-year programme for the improvement of the condition of the Baltic Sea. The agreement was a continuation of long-lasting co-operation. The aim was to launch the construction of St. Petersburg's southwestern sewerage treatment facility. After the completion of the facility, it will be possible to treat all of St. Petersburg's sewerage. Joint efforts were still needed to secure funding for the project.


President Ahtisaari made an official visit to Greece, meeting with President Konstantinos Stefanopoulos and Prime Minister Kostas Simitis. The topics discussed during the visit included the expansion of the EU and the Russian situation. President Ahtisaari hoped that the Russian Government would obtain solid support in the Duma. President Stefanopoulos said that Greece was in favour of President Ahtisaari's initiative on the EU-Russia-US summit. According to the two Presidents, the summit was justified to enhance the role of the EU.


The first ministerial meeting of the Arctic Council was held in Iqaluit, Canada. Minister of the Environment Haavisto delivered the Finnish address during the opening ceremony, focusing on the importance of the EU for the development of the northern regions. According to Mr. Haavisto, the Finnish initiative on the Northern Dimension would enhance the role of the EU in the development of the northern regions. Minister Haavisto wanted to pay special attention to environmental issues, nuclear security and socially sustainable development in the northern regions of Europe, adding that the initiative on the Northern Dimension could also provide new development possibilities for northwest Russia. According to Mr. Haavisto, the Arctic Council will play an important role in nuclear security. He said that US participation in the development of nuclear security in the northern regions would be desirable. The meeting also discussed the Finnish initiative for the development of arctic work, and appointed the US to hold the next presidency of the council.


According to the latest Euro-barometer, the popularity of the EU has decreased. In an opinion poll made in April-May, 36 % of people were in favour of the EU (39 % in October-November 1997), while the number of those against the EU had remained the same, or 25 %. According to the survey, the number of those in favour of the common currency was growing. Fifty-three percent of all Finns considered the Euro to be a positive thing (39 % in October-November 1997) while 38 % were against it.


In a radio interview, Prime Minister Lipponen said that he suspected Sweden would join Economic and Monetary Union, EMU, whatever the outcome of the Swedish elections might be. According to him, the Swedes had so far not been willing to discuss this issue, or they might not have had the chance to do so. He added that the Finnish-Swedish relationship would not change, even if political power in Sweden changed.


According to the ICBL, an organisation campaigning against landmines, the implementation of the agreement prohibiting landmines would increase the pressure on the countries that had chosen not to join. The agreement signed in December 1997 in Ottawa, Canada, will become binding in March 1999; the condition of the 40 countries committing themselves was fulfilled when Burkina Faso ratified the agreement on 17 September. Finland will join the agreement once a defence solution replacing landmines is found. The Head of the Political Department of the Ministry for Foreign Affairs, Director General Pertti Torstila, said that the rapid implementation of the agreement did not have any influence on the Finnish situation. In Mr. Torstila's assessment, the report of the landmine working group was the result of careful consideration, and the timetable did not require revision for the time being.


In his speech at the opening of the Defence Course in Helsinki, Chief of Defence Staff, General-Lieutenant Matti Kopra said that a professional army would be too expensive for Finland. He added that defence and general conscription, in particular, would have to be discussed in the future since it was a pan-European phenomenon that armed forces were being reduced and selective conscription or professional armies were being adopted. According to the General, Finland should not follow the example of other countries uncritically, but needs to consider the issue from a national basis. He also said that although Finnish resources were concentrated in the establishment of rapid deployment brigades of land forces, a regional defence system and general conscription remain the cornerstones of Finnish defence.


The Leader of the Russian Communist Party, Mr. Gennadi Zjuganov, spoke in Strasbourg about the Russian situation, saying that the Finnish authorities should be more accommodating towards requests for food aid in Murmansk. He pointed out that it was easier for the western countries to give humanitarian assistance to Russia than receive a flow of refugees. His advice was for assistance to be given in the form of food supplies since monetary help would be stolen.


The Speaker of the Lithuanian Parliament, Mr. Vytautas Landsbergis, visited Finland on the invitation of his Finnish counterpart, Mrs. Riitta Uosukainen. In Helsinki, Mr. Landsbergis commented on Russia's new Prime Minister and the outlook for his country's NATO membership. In his judgement, Prime Minister Yevgeni Primakov, who in principle was opposed to the NATO membership of the Baltic countries, might in his new situation adopt a more favourable attitude. According to Mr. Landsbergis, Russia has started to consider Poland as being an equal country as a result of its future NATO membership. He hoped that Russia would show a similar attitude towards Lithuania. Mr. Landsbergis proposed that Finland assist the Russian enclave of Kaliningrad and hoped that the EU Commission would negotiate the closing of the Ingalina nuclear plant, a remnant of the Soviet period. In his discussions with Prime Minister Lipponen, Mr. Landsbergis proposed co-operation among the Baltic countries on energy issues.


Italy's Prime Minister Romano Prodi visited Helsinki and met with Prime Minister Lipponen. Besides bilateral issues, the agenda of the two Premiers included the situation in Russia, current EU questions and Kosovo. Transport helicopters and space industry co-operation were special issues dealt with in the negotiations. In concert with Britain, Italy would be offering Agosta helicopters to Finland.


The daily Helsingin Sanomat announced that a case of espionage involving the Ministry for Foreign Affairs had arisen. The Ministry suspected that a Ministry official had leaked confidential EU information to Russia. As a consequence of the suspected espionage, Finland had expelled two diplomats employed at the Russian Embassy in Helsinki. According to the Ministry for Foreign Affairs, this was a serious case which concerned not only the Finnish-Russian relationship but also Finnish reliability elsewhere, for example, in the EU and in certain organisations of economic co-operation. On 23 September, Russian sources made known that Russia was not going to take any reciprocal action to expel Finnish diplomats from Moscow. According to these sources, the case had already been solved some time ago, and Moscow had been surprised by the Finnish authorities decision to disclose it.


Foreign Minister Halonen spoke at the UN General Meeting in New York, focusing mainly on human rights. She underlined the global nature of human rights, saying that all women, men and children had equal human rights, whatever their citizenship or culture might be. Freshly returned from a visit to China, Ms. Halonen expressed her satisfaction with the Chinese statement according to which the country would sign the agreement on citizenship and political rights. She also paid attention to the small arms problem. She insisted that the world organisation recognises the seriousness of the problem and that each UN member state should control its own arms exports.


The EU Ministers of Finance met in Vienna, Austria. In their view, the Russian crisis would not have an effect on the EU countries, whereas the global economic crisis would force the EU to reduce its growth estimate for 1999. The meeting also discussed the representation of the EMU countries in international organisations: the G7 group, the IMF and the World Bank. Minister of Finance Niinistö said that in Finland's view the EMU countries should be represented by the Euro-11, i.e., the country holding the presidency of the EMU Ministers of Finance. France had been hoping for a model according to which the three major EMU countries, Germany, France and Italy, would take turns in representing the EMU. No accord could be reached on the question of representation. Neither did the Ministers increase EU assistance to Russia. They decided that Euro exchange rates would take force in each member state at 00:00 of 1 January, 1999, while the decision on the exchange rates would be made on the afternoon of 31 December.


President Ahtisaari visited Germany and met with Federal President Roman Herzog, and others. In a speech on EU issues held at the Übersee Club, Mr. Ahtisaari insisted on the need for reform of the EU as well as for closer EU relations with other operators in world politics, the US and Russia, in particular. According to the President, presently there is no single, shared opinion of how to develop the Union. Above all, he wished for a common voice for the EU and said he would like to see more EU decisions regarding foreign and security policy taken by qualified majority voting. The Finnish objective was to create a coherent EU policy related to the Northern European regions, and to support the idea of linking Russia, in particular, with the world economy. On 27 September, President Ahtisaari continued on to Hungary. Meeting with the country's leaders, he offered Finnish support for Hungary, which is preparing for EU membership. From Hungary, President Ahtisaari went on to Macedonia and to Bosnia-Herzegovina to meet with Finnish peacekeepers.


At an "EU coaching seminar" organised by the Centre Party, Chairman Esko Aho said that EU membership was presently more important to the Centre Party than to any other Finnish party. According to Mr. Aho, his party needed the Union to implement all three objectives set by the party for the elections, i.e., work reform, regional equilibrium, and people's security. As regards the development needs of the EU, Mr. Aho mentioned security policy, economic policy, technological development and environmental management. He added that "as concerns military security, NATO is and will be the most important instrument for the member states, and for Finland, closer co-operation with NATO is the way to jointly handle the issues of military security." According to Mr. Aho, security comprises many other things which should be taken care of by the EU. He said that these issues required supranational decision-making which Finland would have to join.


In an interview on the commercial TV station MTV3, Prime Minister Lipponen gave his views on the outcome of the elections in Germany, saying that decision-making in Germany might become easier now that the SDP had also become the largest party in the Bundestag. According to Mr. Lipponen, however, the EU expansion process is continuing to slow down because "the Germans are no longer so willing to pay as they used to be."


Mr. Marcelino Oreja, the EU Commissioner responsible for institutional issues, visited Finland. He hoped that the EU would be able to convene a new inter-governmental conference as soon as possible. In his view, such a conference, possibly beginning towards the turn of the millennium, should focus on the difficult issues that could not be solved at the previous IGC.


Finland participated in the Nordic Peace 98 exercise organised in Sweden under the auspices of the PfP programme. The objective of Nordic Peace 98 was to train a peacekeeping operation implemented under a UN mandate. Led by Sweden, the exercise involved units from the Nordic and Baltic countries, including 200 men from Finland. Several planes, helicopters and surface vessels and a total of 1200 men were engaged in the exercise.


The EU and 71 developing countries commenced negotiations in Brussels to revise the Lomé agreement. With the present agreement terminating in 2000, the negotiations will take place during the Finnish presidency. Mr. Pekka Haavisto, Minister of the Environment and of Development Co-operation, said that the Lomé countries had urged Finland to be more active, for example, in its Caribbean policy. In the negotiations for the agreement, the EU will focus on the political dimension, in other words, affirming progress in equality, human rights and environmental issues as conditions for assistance. According to Mr. Haavisto, the Finnish objective was to target economic assistance to the poorest countries joining the agreement.


Yugoslav Ambassador Dusan Crnogorcevic presented an official request for Finland to send forensic experts to examine the victims of the Kosovo massacres. For some time, the EU has put pressure on Yugoslavia to allow an international expert group to investigate who the murdered people were, as well as why and by whom they were murdered. Ministerial Adviser Timo Lahelma of the Ministry for Foreign Affairs stated that the EU committee dealing with this issue had "in substance" given this assignment to Finland, although the formal decision had not yet been made. The formal decision was made on 5 October at the Luxembourg meeting of the Foreign Ministers. The coroners worked in Kosovo from 2 to 21 December, and their work will continue in 1999.


At the request of the UN refugee organisation, UNHCR, Finland promised to receive one hundred Serbs from Kosovo. They will arrive by the end of the year with the status of 'quota refugees' and will be included in the Finnish quota of 600 refugees to be received in 1998.


President Ahtisaari participated in the 60th anniversary celebrations of the province of Lapland. In a seminar held in Rovaniemi, the President focused on the Finnish initiative of the EU Northern Dimension. Mr. Ahtisaari hoped that when the EU Commission was presenting its report on this issue to the European Council in December, it would also make the decision to prepare a concrete plan of action. He said that through the Northern Dimension, the EU was looking at the northern regions as a whole, with the relationship with Russia playing a key role. According to the President, this relationship provides a potential for mutual benefit, particularly considering the large oil and natural gas resources held by Russia. Mr. Ahtisaari added that the Northern Dimension initiative should be reflected in the everyday lives of ordinary people. The main aim was to provide security to these citizens, guaranteeing their social security, in particular.


The EU Foreign Ministers met in Luxembourg to discuss the Kosovo crisis and the expansion of the Union. The Ministers called on Yugoslav President Milosevic to comply with the resolutions of the UN Security Council in order to avoid NATO air strikes. Foreign Minister Halonen said that "if the UN, deciding that Mr. Milosevic has not done what he should do, approves the use of force, the EU will have no problem with that." According to Ms. Halonen, the EU did not agree on air strikes since some of the countries were NATO members while the others were not. She underlined that Finland was "an EU country but not a NATO country." In their meeting, the Ministers decided that the negotiations with the six countries wishing to join the EU would be begin on 6 November. They also pointed out that the Cyprus problem remained unsolved.


The Defence Forces made a survey of the costs of a professional army vis-à-vis a conscription-based army. According to the study, the costs of a professional army of the present size, or 43,000 persons, would cost FIM 25 billion annually. The cost of a professional army would therefore be about two and a half times that of the present conscription-based army. The professional army outlined in the General Staff calculations included all present defence branches. Minister of Defence Anneli Taina said that for cost reasons, the present system was appropriate for Finland. "Moreover, it is regarded as being important, for social reasons, that as large a part of the people as possible have defence training."


In his dinner speech at a seminar organised in St. Petersburg by the Institute for East West Studies, President Ahtisaari said that during the Finnish presidency of the EU, Finland would place a special focus on the development of the Union's Russia policy. At the same time, Finland would make a particular effort to promote "the trilateral co-operation among the EU, Russia and the US, for example, in nuclear security and in the prevention of cross-border crime." In Mr. Ahtisaari's judgement, Russia would have the best chances of managing its economic crisis if it worked in interaction with the outside world. He added that sooner or later, a working market economy called for a constitutionally governed state, supported by a democratic civic society. As regards the EU's Russia policy, Finland would make particular efforts to develop the Russian regional and local administrations, as part of the construction of a legally governed Russia. According to the President, Finland emphasises natural interaction and trading with Russia. "This is also the core of the ideology which we call 'Finland's European vocation' to prevent the creation of new demarcation lines."


Palestinian President Yasser Arafat was in Helsinki and met with President Ahtisaari. Mr. Arafat praised Finnish actions in the Middle East, saying that they were efficient. He hoped that Finland would continue to support and protect the peace process. As a possibility to be considered, Finland could eventually participate in peacekeeping operations between Israel and the Palestinian self-ruled areas, once the negotiations were completed. The Palestinians hoped that Finland, as a member of the EU soon to be holding the presidency, would intensify EU political operations to speed up the Middle East peace process.


Chancellor Viktor Klima of Austria, present holder of the EU presidency, visited Finland and met with President Ahtisaari and Prime Minister Lipponen. The major topic in their discussions was the unofficial EU Summit, to be held on 24 to 25 October in Pörtschach, Austria. The agenda of the meeting will include discussions on the future of Europe, i.e., the expectations placed on politicians and the ways in which politicians intended to meet these expectations. In Mr. Klima's view, the EU should establish a working group to compare the roles played by the different national parliaments in the EU policies of their respective countries. Another task of the working group would be to elaborate on the status of the European Parliament in decision-making. According to Mr. Klima, the Union should intensify its common social and security policy. During the meeting, he proposed that during the Finnish EU presidency, Finland should begin studies on the feasibility of parliamentary decision-making in the EU.


Foreign Minister Halonen made a statement on the Kosovo agreement which had been reached. She expressed her satisfaction that a political solution had been reached through negotiations. In her judgement, the door was now open for the implementation of UN Security Council Resolution 1199, as well as for the return of refugees and for a general calming down of the situation in Kosovo. She proposed that Finland study means to take part in the efforts of the international community to implement the agreement and to alleviate human suffering.


The Finnish daily Helsingin Sanomat organised a Europe seminar, which focused on European Economic and Monetary Union, EMU. Prime Minister Lipponen said in the seminar that the EU Commission should be given more powers to co-ordinate decision-making in the future Euro region. In other words, the Euro region should be able to work closely together and to have only one voice in its contacts with the outside world. For this purpose, the role of the Commission should be enhanced. The Commission should prepare and outline for the operations of the so-called Euro-11 group. According to Mr. Lipponen, the country holding the presidency and the ECB will represent the Euro region on international platforms. In his speech, Mr. Lipponen said he respected the independence of the ECB but also wanted to see the Bank push for lower interest rates, explain its decisions, discuss its operations with other EU institutions and be open in its operations. Mr. Lipponen pointed out that the EMU had already provided good protection for Finland against the Russian and Asian economic crises.


During its evening session, the Government made a decision of principle on the new outlines of Finland's development co-operation policy. According to the Government policy, Finnish interests should be more visibly linked with those of the developing countries, the aim being to harmonise the objectives of foreign and security policy, trade policy and development co-operation. The new decision in principle did not replace a decision made in 1996, according to which the Government objective was to increase the development co-operation appropriation to 0.4 percent of GNP by the year 2000. The Government emphasised that Finland should co-operate with those countries in the weakest situations and with the poorest population groups. The operations should be based on partnership and on the developing countries' responsibility for their own development. According to the Government, Finnish development co-operation policy had four objectives: to increase global security; to decrease the level of extensive poverty; to increase respect for human rights and for democracy, and; to prevent the emergence of new global environmental problems.


The Swedish Minister for Foreign Affairs, Mrs. Anna Lindh, made her first visit to Finland, meeting with her Finnish counterpart. According to Minister Lindh, the change of ministers did not change Swedish foreign policy. In favour of the EU, she said her task was to make the Swedes' attitudes more favourable towards the EU but she did not want to express herself on the timetable for Sweden's eventual participation in EMU.


The Foreign Minister of Tunisia, Mr. Said Ben Mustapha, visited Finland. He met with Finnish political leaders and discussed, among other topics, the political and commercial-economic relations between Finland and Tunisia. The EU Mediterranean policy and the future development of the Barcelona process were, in view of the preparations for the Finnish EU presidency, also discussed.


In a seminar conducted by the Climate Committee of the Finnish Parliament, Minister of the Environment Pekka Haavisto stated that, according to preliminary calculations, the 1997 level of emissions contributing to the greenhouse effect was more or less the same as in 1990. The 1990 level was the objective which Finland had promised to reach by the year 2010, the Finnish share negotiated within the EU for the implementation of the Kyoto Framework Convention on Climate Change, signed in 1997. Should the calculations be made on the basis of new methods hold true, the Finnish energy sector will not need to decrease its carbon dioxide emissions by the estimated 10 percent of present levels by 2010.


The Cabinet Foreign and Security Policy Committee discussed the situation in Kosovo, confirming that Finland would take part in the OSCE control operation. Earlier, Yugoslav President Milosevic had consented to the request to let 2000 OSCE observers enter Kosovo, to allow refugee aid workers to work in Kosovo, and to approve control flights by NATO planes.


In preparation for the Finnish EU presidency, Foreign Minister Halonen visited the US. Vice Secretary of State Strobe Talbott and Minister Halonen agreed that the Americans and the Finns would try to look for ways to improve the status of women in the Baltic countries. In her speeches in Washington and at Harvard University, Ms. Halonen discussed current EU foreign policy issues and the importance of EU expansion for the development of democracy and civic societies.


The Chairmen of all registered parties present in Parliament signed a charter for a racism-free society, prepared at the initiative of an EU Committee on racism and xenophobia.


In his address to a meeting celebrating the centennial of the Finnish Law Association in Helsinki, President Ahtisaari focused on human rights, saying that Finland should not judge or put pressure on China to change its human rights policy. According to President Ahtisaari, "to-the-point dialogue and practical cooperation often yield more results than condemnation and pressure." The President also said that "China has already shown an interest in obtaining information about how the legislative reforms and development of systems that are prerequisites for filling human rights obligations have been carried out here in Finland." Likewise, the experience of co-operation in legal matters had been favourable. Mr. Ahtisaari pointed out that the Finnish objective was to promote human rights globally, and that it was due to Finland that the EU had made a stronger commitment with respect to basic rights in the Amsterdam Treaty. The extensive ban on discrimination proposed by Finland for the Treaty was very similar to an article of the Finnish Constitution.


At the unofficial EU Summit organised in Pörtschach, Austria, the social-democratic leaders of EU countries and the ECB disagreed on the running of the European economy. The leaders asked for lower interest rates because European economic growth had slowed down. In their judgement, lower interest rates would boost consumption and investment. Prime Minister Lipponen asked for intensified economic co-operation in Europe so that interest rates could be lowered. According to Mr. Lipponen, the ECB should ensure that interest rates would not be raised, thereby securing continued growth and employment. According to the proposals made by Germany and France, economic growth should be boosted through lower interest rates and increased public works. Mr. Lipponen argued that increased public works were not sufficient and that structural measures were also needed. As concerned the security issue, Austria proposed that the extraordinary summit being arranged in Finland for autumn 1999 should address drugs, crime and immigration issues. The heads of state agreed that the EU's common foreign and security policy should be enhanced.


Prime Minister Lipponen made a trade-focused visit to China. With Hong Kong included, China is Finland's major non-EU trading partner, second only to the US. The Prime Minister was accompanied by Minister of Traffic and Communications Matti Aura and Minister of Social Affairs and Health Sinikka Mönkäre, as well as a by a small delegation of company executives. In Beijing, Prime Minister Lipponen met with his Chinese counterpart Zhu Rongji, discussing Finnish forest expertise, the Chinese economy, the economic crisis in Asia and the human rights situation in China. Mr. Lipponen said he had presented his views on how to save the world economy. He mentioned the new funds which would provide help to crisis-ridden countries at short notice. After meeting with President Jiang Zemin, Mr. Lipponen said that China was aiming to develop into a state based on the rule of law with human rights in force. He said, however, that it was necessary to understand that there were no shortcuts in this respect. 'Human Rights in China', a Hong Kong-based organisation, said that Mr. Lipponen was guilty of soft bargaining with China on human rights issues. They felt that the Prime Minister and Finland should raise their voices when they saw serious violations of human rights.


Foreign Minister Halonen commented on the results of the Wye River Middle East peace negotiations, saying that she was very satisfied with the fact that a new agreement had been reached in the conflict. She thanked the US, and especially President Clinton and Secretary of State Albright, for their efforts to reopen the peace process. She hoped that the outcome of the negotiations would lead to increased trust between the parties to the Middle East conflict.


The Romanian President, Emil Constantinescu, accompanied by his wife and Foreign Minister Andrei Plesu, visited Finland and met with President Ahtisaari. In their discussions, the two Presidents talked about the Romanian drive to join the EU; Romania was looking for Finnish advice in this respect. Trade policy issues were also discussed. In his address to the Paasikivi Society, President Constantinescu said that the Romanian objective was NATO membership. He said that the role played by Romania was geopolitically important for stability in Central Europe.


The newly nominated Foreign Minister of Estonia, Mr. Raul Mälk, visited Finland and met with Foreign Minister Halonen. Estonian membership in the EU was the main theme of their discussions. Ms. Halonen ensured him that the EU would make every effort to implement EU expansion according to plan, although both the countries wishing to join and the EU will be faced with difficult challenges. According to Ms. Halonen, Finland has repeatedly underlined the importance of promoting the expansion negotiations. Estonia plans to begin detailed EU negotiations on 10 November.


In his speech at the opening of the Legislative Assembly of Åland, President Ahtisaari urged the Provincial Government and Diet of the Åland Islands to make it very clear that they did not want a change in the status of the province, but that "the present autonome is the foundation on which they stand and for which they are working." President Ahtisaari here referred to the debate on the independence of the Åland islands, launched in the previous summer by Mr. Anders Eriksson, a member of the Provincial Government. In the President's judgement, a change in the present form of government would not be in the interest of the Republic of Finland. Independence would bring about changes which would be hard to anticipate. "All international relations - not least the European Union - would have to be built up again and what willingness to do this exist is completely uncertain."


Foreign Minister Halonen said that spending for the Kosovo operation would amount to FIM 8 million in 1998 and about 20 to 30 millions in 1999. The OSCE would send 2000 controllers to Kosovo to monitor the return to peace and normal life by the Kosovo Serbs and ethnic Albanians. Finland would send 30 to 35 controllers. Ms. Halonen said that the protection of the unarmed controllers would be difficult, although NATO, the OSCE and the EU had prepared protection plans.


The EU Ministers of Defence held their first joint meeting in Vienna, Austria. The idea for the meeting had originated out of the views presented by the British Prime Minister, Tony Blair, regarding the development of a common EU defence. An enhanced role for the WEU, the merger of the WEU into the EU, or the development of "European Dimensions" within NATO were proposed as alternatives in this regard. The Ministers of Defence came to the conclusion that the military role of the EU should be developed for the solution of crises in Europe. However, no concrete decisions were made and neither were any future meetings agreed upon. Speaking at the meeting, Minister of Defence Taina emphasised the importance of rapid decision-making and the correct timing of operations in crisis management. In her view, NATO and Trans-Atlantic co-operation are irreplaceable from a military point of view. She added that EU-NATO co-operation in crisis management should continue because it promoted the development of the common foreign and security policy, thus strengthening the Union.


Foreign Minister Halonen said that Finland had been satisfied with the assessment published by the EU Commission on 4 November, according to which many applicant countries had made progress during the past year. She added that Finland was hoping that those countries with slower development would also intensify their efforts to comply with the membership criteria. According to Minister Halonen, Finland was very happy about Latvia having made so much progress that the conditions now existed to consider the launching of negotiations with the country. Lithuania had also made progress, and Finland hoped that the positive trend would continue so that the negotiations could be started as soon as possible.


Prime Minister Lipponen participated in an unofficial meeting of the Nordic Prime Ministers and Ministers of Finance, held in Oslo, Norway. In his judgement, Sweden and Denmark had set their course towards EMU as a consequence of the recent fluctuations in the world economy. The Swedish Prime Minister Göran Persson's attitude towards EMU was now more positive, thanks to the latest opinion polls according to which an increasing number of Swedes were favourable to EMU. The 50th session of the Nordic Council took place between 9-12 November, and the first day was dedicated to the so-called 5+3 negotiations between the Nordic and Baltic Prime Ministers. The topics of their discussions were; Estonia, Latvia and Lithuania's relations with Russia; the EU Northern Dimension; EU expansion; energy co-operation; and the prevention of cross-border crime. The Prime Ministers of Sweden, Denmark and Finland gave their full support for the EU membership negotiations of the three Baltic countries. The Nordic Ministers of Defence insisted on more developed and intensified co-operation in defence and security policy.


Lithuanian President Valdas Adamkus, accompanied by his wife, made a working visit to Finland, meeting with President Ahtisaari and Prime Minister Lipponen. The discussions focused on integration in Europe, Baltic co-operation as well as on commerce and bilateral relations between Finland and Lithuania. A cultural agreement and a road traffic agreement between the two countries were also signed.


The EU Foreign Ministers meeting in Brussels discussed the intention of the EU Commission to send food aid to Russia totaling FIM 2.4 billion. The question had been brought up after the US had decided to donate about FIM 3 billion for food. The EU would donate food to Russia on the condition that Russia would sell the foodstuffs on the local market and deposit the income in a special fund to finance social programmes. The EU would also give FIM 40 million worth of humanitarian help. The Foreign Ministers also agreed upon an aid package of FIM 400 million for the victims of hurricane Mitch that had hit Nicaragua and Honduras. Ms. Halonen said that Finland had already given about FIM 3 million, and that the decision for a further 3 millions of donations would probably be made shortly.


Prime Minister Lipponen was in Moscow, discussing with his Russian counterpart Yevgeni Primakov, about Finnish helicopter and assault tank acquisitions. Mr. Lipponen rejected the allegation of discrimination against the Russian offer for the project, pointing out that the Russian manufacturer was still included among those competing for the helicopter tender. However, no Russian manufacturer was competing for the supply of the required infantry fighting vehicles. During the Prime Minister's visit to Moscow, Russia offered Finland co-operation in the improvement work on the Kantalahti nuclear power plant situated on the Kola Peninsula.


Foreign Minister Halonen submitted the Government's Report on Human Rights Policy to Parliament. For the first time, the Government stated in writing the principles of Finland's human rights policy and its respective objectives. According to the report, the Finnish objective is to promote respect for human rights in all parts of the world. Human rights play a central role in Finnish foreign and security policy, and they are considered in all sectors of that policy. The Government should be able to justify its human rights policy in public. The scope of the report also included trade policy and arms exports.


President Ahtisaari made an unofficial working visit to Estonia, meeting with President Lennart Meri. During the biannual meeting of the two Presidents, Mr. Ahtisaari said that, it is important for Finland and Europe that Russia be frank about its assessment of the Soviet era. He said that he had thanked President Yeltsin for admitting that the Soviet Union had wronged Finland in 1939. According to Mr. Ahtisaari, this statement was a turning point in relations between Finland and Russia. He added that in constructing relations, honesty was the best policy. The Finnish initiative on the EU Northern Dimension was another major theme of the discussions. In President Ahtisaari's judgement, the Baltic countries could participate in Northern Dimension co-operation projects prior to their membership and their respective negotiations. He hoped that the signing of the border agreements between the Baltic countries and Russia would take place soon. President Ahtisaari expressed his appreciation for the integration of the Russian population in Estonia but added that unlike Latvia, Estonia had not yet adopted a similar citizenship law.


The Ministry for Foreign Affairs stated that Finnish observers would be included in the Kosovo Verification Mission, KVM under the auspices of the OSCE in Kosovo. Finland would be prepared to send 30-35 persons. The observers were expected to arrive in Kosovo gradually during November and December.


According to a survey commissioned by Maanpuolustustiedotuksen suunnittelukunta MTS, (a planning group for defence information), almost two thirds of the respondents, or 60 %, were of the opinion that Finland should remain non-allied while one third (29 %) said that Finland should join a military alliance. The percentage of those in favour of military alliance had grown clearly, up 20 % from 1996. Should Finland decide to join a military alliance, more than half of the respondents (54 %) would choose NATO, while one fifth would be in favour of a military alliance with Sweden and 14 % preferred full membership in the WEU. 66% of the respondents were of the opinion that Finland was committing itself to NATO as a consequence of co-operation taking place in many fields. Two thirds of Finns were satisfied with the way in which foreign policy was being run, while 16 % were dissatisfied. In 1997, the corresponding percentages were 74% and 21%, respectively. As regards a defence system based on general conscription, 75 % were in favour.


The Foreign and Defence Ministers of the WEU member, associate and observer countries met in Rome. The meeting mainly focused on the creation of a European defence structure, complementary to NATO but capable of independent action. In its status as an observer, Finland took part in the meeting of the West-European Defence Material Group WEAG, arranged for the first time in connection with the WEU ministerial meeting. The Ministers attending the meeting, including Mrs. Taina of Finland, signed framework agreements which would give the countries involved the possibility of taking part in co-operation in defence materials research which would be implemented under the auspices of WEAG. According to Minister Taina, Finland was seeking to become an ordinary member of the WEAG.


The Centre for Finnish Business and Policy Studies, EVA, published an opinion poll conducted between 18 September and 5 November in which the Finns were asked about their expectations in relation to the Northern Dimension project. According to the survey, the cleaning-up of the Baltic Sea and safeguarding living conditions in densely populated areas of Finland were considered as being the most important. Moreover, the Finns considered that increased safety regarding nuclear power, and improved security of the northern regions in general were important issues. The opinions of the Finnish people on the central issues in question are similar to the aspects that the European Commission wants to include in the Northern Dimension. Among the respondents, 42 % were of the opinion that the decision to join EMU was the correct choice, while 30 % thought that it was not a good decision. Nine Finns out of ten were of the opinion that the member states should be able to influence the ECB policy. 43% of the respondents had a positive attitude towards EU membership (38 % in 1997) while 25 % were negative (29 % in 1997).


The Ministry for Foreign Affairs granted FIM 5 million additional assistance to the Central-American victims of hurricane Mitch. The aid was used in the UNDP rebuilding projects in the northern parts of Nicaragua.


Mexico's Foreign Minister, Mrs. Rosario Green, visited Finland and met with President Ahtisaari, Foreign Minister Halonen and Minister of Development Co-operation Haavisto. During their negotiations, Mr. Ahtisaari and Mrs. Green discussed bilateral relations between their countries and the situation in Russia. Mrs. Green said that Mexico was trying to distance itself from the US in an effort to make its foreign relations more versatile. Mexico is presently negotiating a free trade agreement with the EU. Mrs. Green expected that the negotiations might be finalised during the Finnish presidency of the EU towards late 1999.


According to an article published in the daily Helsingin Sanomat, the Constitutional Committee of Parliament would like to abolish the President's right to give direct military orders to the Chief of Defence Forces without informing the Government. The earlier Government proposal for a new Constitution had left the President's supreme command powers and the associated military command structure virtually unchanged. According to the Minister of Defence Taina, the revision of the article was justified. She said that, "the change is in line with the fact that the Constitution proposal aims to increase parliamentary influence in foreign and security policy issues."


The Nordic Ministers of Defence met in Tampere, Finland, focusing on the joint helicopter acquisitions. Minister Taina said that Finland was prepared to wait 6 months for a joint Nordic decision regarding the helicopter acquisition. Each country had prepared its own interim report on the issue, and the final report was due in December. The Tampere meeting also discussed Nordic peacekeeping operations. The Nordic countries have increased their presence in the peacekeeping operations in Macedonia and Kosovo to 600 men.


In a meeting celebrating the 40th anniversary of the Paasikivi Society, President Ahtisaari said that, much to Finland's disappointment, the EU did not yet have a common foreign and security policy. He added that foreign and security policy meant co-operation between governments, and such co-operation should be intensified when the Amsterdam Treaty takes force in 1999. According to Mr. Ahtisaari, the Kosovo crisis was the latest example demonstrating the need for joint operations. He said that the big member countries, in particular, should compromise so that the future joint projects will not be jeopardised due to the lack of a common voice. Mr. Ahtisaari expressed his strong support for the expansion of the EU, saying that it was a key factor in European peace and security, as well as vital for the vitality of the continent.


The EU Ministers of Finance meeting in Brussels agreed that from July 1999, the Minister from the country holding the EU presidency, and therefore chairing the Ecofin Council, would represent the eleven EMU countries at the G7 Group of leading industrial economies. Should the country holding the presidency not be an EMU country, the following Euro country in line for the presidency would represent this group. The three biggest EMU countries, Germany, France and Italy, would take one-year turns to support the smaller "speakers" in the meetings.


Foreign Minister Halonen represented Finland at the OSCE ministerial meeting in Oslo, Norway. The meeting focused on the organisation's task of monitoring the agreement negotiated between the US Special Envoy Holbrook and Yugoslavia's President Milosevic, an agreement obliging the Serbs and Kosovo Albanians to end the fighting in Kosovo. Enhanced readiness in view of conflicts, as well as expansion of the Vienna Secretariat of the OSCE were other items on the agenda. In her address delivered in the name of Finland, Ms. Halonen presented Åland as a model for resolving ethnic and religious conflicts. She also invited representatives from Central-Asian and Caucasian countries to Finland next March to see how democratic parliamentary elections were held. Ms. Halonen promised Finland's full support for the upcoming Norwegian presidency of the OSCE. As regards the Kosovo crisis, the Macedonian Government agreed to receive NATO forces with the mandate to protect the OSCE observers working in Kosovo.


The landmine protocol to regulate the use of mines, which was adopted in Geneva two years ago, came into effect. Finland will not discard a single mine on the basis of the protocol, the practical effect of which is that of specifying the classifications, markings and uses of mines. Finland will continue to use anti-personnel mines in its defence but is looking for ways to replace these armaments for use by the rapid deployment brigades.


According to a joint declaration by France and the UK at the closing of the Saint-Malo Summit, "the European Union should have an independent operative capacity, based on a credible military force, sufficient common funds and a readiness to reply to the challenges caused by international crises."


The Finnish and Swedish Foreign Ministers, Ms. Halonen and Mrs. Lindh, published a joint newspaper article on crisis management in the Helsingin Sanomat and Dagens Nyheter. They said that the UK's Prime Minister Tony Blair had launched discussions on ways to improve the EU's readiness in crisis management. According to the two Ministers, Sweden and Finland have positive attitudes and concrete contributions to the debate. As concerned the Amsterdam Treaty, the Petersberg tasks will play a central role for the EU's common foreign and security policy. They added that European crisis management is based on volunteerism and solidarity, as well as on the preparedness to make a joint effort for peace and security. Therefore, it is important to utilise the resources and expertise of all member states, whether they are non-aligned or NATO countries. The Ministers emphasised that any use of force required a UN mandate. According to them, co-operation between the EU and the WEU is rapidly developing, adding that Finland and Sweden are developing the resources for military crisis management and are prepared to assign these resources to be used by the WEU. Concerning the development of EU and WEU crisis management structures, they said it is very important to have a close relationship with NATO and the US. If necessary, the WEU could resort to using NATO resources. Due to limited international resources, overlapping structures should be avoided.


At the autumn meeting of the Finland-Russia Society, Prime Minister Lipponen said that it was in Finland's interest to intensify co-operation in security policy. According to Mr. Lipponen, the French-UK declaration regarding the creation of credible military forces for the EU was strengthening the effort to manage security policy issues in collaboration within the EU. He added that no change was taking place in the EU's foreign and security policy but that this development was in line with the Amsterdam Treaty.


In Brussels, the EU Foreign Ministers discussed the Agenda 2000 programme for the reform of the sources and uses of the Union funds. However, the Agenda 2000 negotiations failed. If Germany is unable to achieve any results on this issue during its presidency of the Union, Finland will have to take up the challenge when its turn at the head of the Union comes in mid-1999.


According to an article published in Helsingin Sanomat, the Nordic countries are planning to strengthen the joint Nordic reaction forces, the Nordcaps, established according to a decision reached by the Ministers of Defence in July. According to the Defence Forces, a full brigade has been more or less completed so far, with some parts still missing. Finland has registered two battalions and two companies in the NORDCAPS i.e., the same as is recorded in the UN readiness force register. Minister of Defence Taina said that Finland would be developing its own military co-operative capacity so that in a crisis situation, it could itself obtain military assistance. She also said that the Government had outlined in its own report that co-operation and co-operative capacity are there to support Finland in a crisis situation in which we might need outside help. In such a situation, there would be joint operations.


The Government made a decision to approve two development credits (90 million) granted to Nicaragua, and Minister of Development Co-operation Haavisto said that Finland would like to align itself with many other countries and financial institutions in helping the country in its reconstruction.


Prime Minister Lipponen said before the Grand Committee of Parliament that France and the UK only wished to develop EU crisis management capacity rather than a common defence. According to Mr. Lipponen, the representatives of the two countries had confirmed this interpretation at the EU meeting of Foreign Ministers held on 6 and 7 December. In a press conference following the meeting with the Grand Committee, Mr. Lipponen said that the Franco-British proposal corresponded to the outline adopted in the Amsterdam Treaty on the initiative of Finland and Sweden. In his judgement, the UK and France had reintroduced the discussion because two large countries would not address an initiative made by two small countries.


President Ahtisaari made an official visit to Slovenia. Meeting with President Milan Kucan and Foreign Minister Boris Frlec, he discussed the EU and European security with them. In the speeches made by President Ahtisaari, he said that the present EU members were in charge of the reform work and the candidate countries would in turn have to revise their legislation to comply with the EU. Concerning NATO, President Ahtisaari said that it should develop and become flexible in order to be able to meet present and future challenges. President Ahtisaari commented on the new French, British and German security policy that has been outlined by saying that in the best of cases, these countries would be speaking about the same thing - crisis management and its intensification.


50th anniversary of the Declaration of Human Rights.


President Ahtisaari, Prime Minister Lipponen, Foreign Minister Halonen and Minister of Finance Niinistö took part in the EU Summit in Vienna, Austria. The heads of state decided to sign a special employment agreement with the objective of linking the employment policies of the different member states. In Vienna, they also confirmed the model of representation of the EMU countries vis-à-vis the outside world: in the G7 meetings, the President of the Euro-11 council and the EU Commission would represent the EMU. If a country not belonging to the G7 group were holding the presidency, Germany, France or Italy would assist it. Finland was going to be assisted by France during the Finnish presidency starting in July 1999. Mr. Lipponen found the model acceptable but said that in the future the small countries, when representing the group, should be able to act independently. No agreement was found in relation to the reform of the EU agricultural and structural policy, Agenda 2000. In Mr. Lipponen's view, however, the positions had come closer, and decisions could be expected during the German EU presidency. As anticipated, the Summit approved the intent to construct the so-called Northern Dimension for the EU. It was also agreed that the EU would draw up its first common foreign policy strategy for Russia. The Northern Dimension was not allocated any new funding but will be financed through existing funds. Both the Northern Dimension and the Russia strategy were projects advocated by Finland. The Summit assigned the preparation of the issue to the Council, projecting the implementation of the two projects to take place during the Finnish presidency. Furthermore, the Summit decided that Finland would arrange a ministerial meeting on the Northern Dimension within a year.


The German Foreign Minister, Mr. Joschka Fischer, visited Finland on the eve of the German presidency of the EU. He met with Foreign Minister Halonen and Minister of the Environment Haavisto. Mr. Fischer said that it was important now to discuss what was expected of the common foreign and security policy. According to him, instability and Balkan nationalism were factors threatening security in Europe. He said that it was important to support democracy, stability and economic reform in Russia.


When discussing the Foreign Affairs appropriation in the 1999 budget, Parliament also debated Finland's relationship with NATO. Parliament raised many questions: was Finland joining NATO? Is there to be a common European defence? Would Finland only be involved in crisis management? Foreign Minister Halonen and Minister of Defence Taina refuted the allegation that Finland was drifting towards NATO membership. Mrs. Taina emphasised that co-operation in crisis management was not the same as military alliance and common defence. She said she did not believe that the EU would become a military alliance. Should, however, such a view emerge strongly within the EU, Finland should actively take part, she concluded.


Leaders of Finnish foreign policy commented on the US and UK air strikes against Iraq. Foreign Minister Halonen said that there was anticipation within the EU as to how the situation would develop. Ms. Halonen did not comment on whether the US or the UK had contacted Finland before launching the air strikes. Speaking in Kauniainen, President Ahtisaari, however, said that Finland had not received any advance warning of the strikes but that they had not come as a surprise to him. According to Ms. Halonen, it was regrettable that Iraqi co-operation with the UN arms control group, Unscom, had failed despite the efforts of the international community. She had hoped that the UN Security Council would have been able to approve a unanimous resolution by the end of the debate on the issue.


In an article published in the International Herald Tribune, President Ahtisaari defended co-operation between the EU and Russia. He said he expected that Russia would now have what it takes to create a working federal state, with power genuinely being transferred downwards. He said that Finland was in favour of strong EU support for the development of regional and local levels of administration in Russia. President Ahtisaari said that President Yeltsin had stamped a seal on a new reconciliation between Finland and Russian by laying a wreath at the memorial of Finnish war-heroes and admitting that it had been wrong of the Soviet Union to attack Finland in 1939. Mr. Ahtisaari said that the countries common history still had its sore points but that they were no longer a burden for their relationship.


Prime Minister Lipponen visited Germany and met with the new Chancellor, Mr. Gerhard Schröder. Mr. Lipponen and Mr. Schröder said they were convinced that the March Summit would be able to agree on the much debated financial issues of the Agenda 2000 programme. They also discussed the crisis of confidence between the European Parliament and the Commission related to the management of EU funds. During his visit, Mr. Lipponen also raised the issue of EU's Russia strategy as well as the Northern Dimension.


A meeting of the Euro-Atlantic Partnership Council (EAPC) was held in Brussels. On this occasion, the Nordic Ministers of Defence received the report of the working group, lead by Senior Adviser Eero Lavonen, which had studied the possibilities of the joint Nordic helicopter acquisition. The objective was for the countries to be able to sign a co-operation agreement in early summer 1999.


According to a statement published by the executive committee of the Vasemmistoliitto (The Left Alliance), the heads of Finnish foreign policy should have taken a firmer stand on the bombing of Iraq by the US and UK. The party insisted that the strikes must be stopped immediately and that the UN Security Council should decide upon any further action. According to the Left Alliance leaders, the bombing was a severe blow to the UN and to the entire international co-operation based system.


In an interview broadcast by Radio Suomi, a Finnish Broadcasting Company station, Prime Minister Lipponen said that he did not agree with the Left Alliance as regarding the air strikes on Iraq. In his view, the western world had no other choice but military strikes against Iraq. He repeated that Finland had very clearly expressed its view according to which the bombing was regrettable. In his judgement, the strikes took place within a situation in which all diplomatic measures had been used. He also said that it was a question of interpretation whether the UN was behind the strikes or whether the US and Britain implemented them on their own, since the UN Security Council had made earlier resolutions justifying, in the minds of the US and Britain, the action taken.


Chairman of the Social-Democratic Group of Parliament, Mr. Erkki Tuomioja, and the party's MP, Kimmo Kiljunen, criticised the US and UK strikes in Iraq. In their joint statement, the two MPs disapproved of the stands expressed by Finland on this issue. According to them, "as important as it is for Finland to give its unambiguous support to the demand of making Iraq responsible for its policy of aggression and weapons of mass destruction, it is equally important that our country should not uncritically express its approval for American trigger-happiness and unilateral action as the world's police." In the judgement of Mr. Tuomioja and Mr. Kiljunen, international security and the prestige of the UN had suffered serious damage. In their opinion, there had not been a serious enough effort to find a negotiated solution.


In an interview in the newspapers Turun Sanomat, Aamulehti and Savon Sanomat, Prime Minister Lipponen sought to cool down the NATO debate. In his view, the National Coalition Party and the Swedish-speaking People's Party were "flirting" with the NATO issue. He said that the debate was a society game with no content and with no real thinking involved. He emphasised that the possible alternative to joining NATO was to see the NATO issue as a potential instrument of Finnish foreign policy. By saying that the country was never going to join NATO, Finland would limit its room to manoeuvre in foreign policy. Mr. Lipponen also denied the allegations that Finland was being driven into NATO through the back door.


State Prosecutor Jarmo Rautakoski said that First Secretary Olli Mattila of the Ministry for Foreign Affairs was going to be indicted for espionage. It was alleged that he might have jeopardised Finland's foreign relations when he gave EU-related trade policy documents to the Russians. According to State Prosecutor Rautakoski, it was not possible that Mr. Mattila, who held the position of First Secretary at the Ministry for Foreign Affairs, would have given the incriminating information by accident.


According to Mr. Adam Jasser, head of the Finnish office of the British news agency Reuters, a doctrine dating back to the Cold War period had prevented Finland's membership in NATO, even though the door had been open for years and Finland in reality wanted to join. According to this doctrine, Finland had to avoid anything that would upset the mighty neighbour to the East. Finnish foreign policy was still following the Paasikivi line, according to which even a weak Russia was big from the Finnish perspective. According to the author of the article, the French-British initiative regarding a common European defence could offer Finland a pretext that would make Finland's NATO membership more appealing to the Russians.