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Cablegate: Turkey's New Importers Associations

This record is a partial extract of the original cable. The full text of the original cable is not available.

101602Z Jun 04

UNCLAS SECTION 01 OF 02 ANKARA 003240

SIPDIS


DEPT FOR EB AND EUR/SE
DEPT PLEASE PASS USTR FOR LERRION
USDOC FOR ITA/MAC/DDEFALCO


SENSITIVE


E.O. 12958: N/A
TAGS: ETRD TU
SUBJECT: Turkey's New Importers Associations


Sensitive but Unclassified. Please Handle Accordingly.


1. (SBU) Summary: A variety of private businesspersons
suggest that the GOT's imminent creation of mandatory
associations of Turkish importers could impede trade and
might be inconsistent with Turkey's WTO obligations.
The Turkish Foreign Trade Undersecretariat (FT)
dismisses these allegations, maintaining that the
associations are intended to enhance importers' ability
to engage with the GOT and with external suppliers on a
sectoral basis, and to facilitate better import
reporting. End Summary.


2. (SBU) A 2001 Council of Ministers decree called for
the establishment of associations with mandatory
membership for all importers. The decree is only now
being implemented, with a July deadline for importers to
join the associations, which are organized on a sectoral
basis. Representatives of Price Waterhouse Coopers, the
Turkish Union of Chambers and Commodities Exchanges
(TOBB), the Foreign Investors Association (YASED), the
Turkish Industrialists' and Businessmen's Association
(TUSIAD) and others told us they are lobbying against
the concept and fear that the associations could be
deployed to restrain Turkey's rapid import growth. They
maintain that these organizations could block or impede
imports by interfering in pricing and quality standards
for imported goods, and by imposing extra documentary
requirements and fees on imports as well as membership
fees on importing companies. A 2004 regulation includes
a fee proportionate to the value of goods imported as a
potential source of revenue for the associations.


3. (SBU) Murat Yapici, FT's Deputy Director General for
Imports, told Econoff and Econ Specialist on June 8 that
these allegations were unfounded and that FT had no
intention of surrendering regulatory powers to importers
associations. He contradicted industry's claim that the
new associations would have the power to manipulate
import prices or to block imports. Noting that the
associations would determine membership fees, he opined
that the fee burden on companies would likely be small
and should not be a barrier to trade. Yapici stated
that the registration fee for companies and individuals
is now set at 100 million TL (about USD 65).


4. (U) According to Yapici, the associations, modeled on
existing, mandatory-membership exporters unions, are
intended to give Turkish importing companies a lobbying
organization to represent their interests abroad as well
as in dealings with the GOT. As the future repository
for electronic customs declarations, the associations
are also intended to support faster and better
collection of import statistics.


5. (U) The importers associations have already begun to
take shape, as approximately 10,000 member companies
elected board members for sectoral associations in late
May and early June. These boards will shortly elect
chairpersons, who will in turn propose a short list of
candidates for the post of Secretary General to FT,
which will make the final choice for this post.


Comment
-------


6. (SBU) Facing a trade deficit that could exceed USD 20
billion this year, the GOT is under some pressure from
import-competing industries to boost protection. While
we are somewhat heartened by FT's explanation of the
functions of the associations and its insistence that
they are not intended to be a new barrier to imports,
there is a real risk that a new series of quasi-official
bodies will increase already burdensome bureaucracy in
Turkey and possibly create an indirect barrier to
imports from the United States and other countries.
Coming at a time of heightened GOT concern about
imports, and about their impact on domestic
manufacturing, it is not outside the realm of
possibility that the GOT would try to use the importers'
association to brake import growth. Price Waterhouse
went so far as to allege that domestic producers would
join the importers associations in order to use their
powers against importing competitors. Embassy will
continue to follow the development of importers
associations and will advise of any negative trade
impact.


7. (SBU) Even if the associations prove to be benign in
terms their impact on imports, the fact that the
Government is mandating their creation reflects the
continued statist, interventionist mentality of many
Turkish officials and politicians.
Edelman

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