Cablegate: Scenesetter: Ambassador Schnabel's Visit to Turkey

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

UNCLAS SECTION 01 OF 05 ANKARA 006207

SIPDIS

DEPARTMENT FOR EUR/SE

E.O. 12958: N/A
TAGS: PGOV PREL EU TU
SUBJECT: SCENESETTER: AMBASSADOR SCHNABEL'S VISIT TO TURKEY

REF: A. ANKARA 5781
B. ANKARA 6116

1. (SBU) Summary: Your visit to Turkey provides an excellent
opportunity to assure the Turks that the U.S. continues to
support Turkey's EU candidacy. Some elements in Turkey view
the U.S. and EU as rival power blocs, and question why the
U.S. would want Turkey in the EU. By highlighting areas of
U.S.-EU cooperation, you can help disabuse the Turks of the
view that their EU membership would result in a lesser
relationship with the U.S. The GOT has adopted a wide range
of EU-related legal reforms over the past three years,
designed to crack down on torture, ensure gender equality,
and expand the rights of expression, association, and
religion. The GOT has also created a high-level Reform
Monitoring Group to overcome bureaucratic resistance to the
reforms. GOT officials believe the European Commission's
October 6 reports pave the way for the opening of accession
talks in 2005, though they are concerned that some Commission
recommendations would subject Turkey to different standards
than those applied to other candidate countries. Some
pundits and opposition party leaders have criticized the
Commission reports. Our approach is to continue to encourage
the Turks to look on the positive side and to take yes for an
answer.

2. (SBU) On Cyprus, we are taking steps to ameliorate the
isolation of the Turkish Cypriots, without recognizing the
so-called "TRNC." The highest priorities for Turkish
Cypriots and the GOT are direct trade and direct flights
between the U.S. and north Cyprus. Our EU contacts say ROC
President Papadopolous has not gained support for his call
for Turkish concessions on Cyprus in exchange for the opening
of accession talks. Some GOT officials share our concern
over Iran's nuclear program; Turkey has urged Iran to
cooperate with the IAEA and EU-3. Turkish-Armenian relations
remain deadlocked; Turkey will not open the border with
Armenia or restore diplomatic relations absent Armenian
concessions on Nagorno-Karabakh and other occupied Azeri
territory. The GOT shares our broad goals on Iraq and is
supporting our efforts. Bilateral trade with Iraq is growing
rapidly and is expected to reach $1.8 billion this year. At
the same time, the GOT is concerned about Kurdish IDP flows
into Kirkuk and the continued presence of the PKK in northern
Iraq.

3. (SBU) The Turkish economy has recovered strongly from the
financial crisis of 2000-2001 and is growing at an annual
pace of over 10 percent. However, the recovery remains
vulnerable due to a large current account deficit and a large
debt. Due to historic economic/political volatility and
opaque regulatory/judicial systems, Turkey has long received
less foreign direct investment than other countries of
similar size and potential. GOT officials underestimate the
enormous challenges they will face in adopting the economic
requirements of the EU acquis. End Summary.

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Need to Assure Turks of U.S. Support
------------------------------------

2. (SBU) The USG has consistently encouraged the GOT's
EU-related reform process and urged the EU to recognize
Turkey's progress, consistent with our overall policy of
supporting Turkey's EU candidacy. Nevertheless, some
elements in Turkey, including many members of Parliament, are
skeptical of U.S. support. They tend to overlook the close
bonds between the U.S. and Europe and view the U.S. and EU as
rival power blocs. In that context, they find it difficult
to understand why the U.S. would support Turkey's EU
candidacy. At the same time, some Turks who value the
Turkey-U.S. relationship worry that EU membership will
undermine relations with Washington. Your visit provides an
excellent opportunity to place the U.S.-EU relationship in
proper perspective. You can outline for Turkish
interlocutors the many areas of U.S.-EU cooperation, and
explain how Turkish membership would benefit all parties. We
want to assure the Turks that we continue to support them,
without making it appear to Europeans that we are meddling.

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GOT Has Made Major Reforms
--------------------------
3. (SBU) The European Commission's October 6 recommendation
to open accession talks with Turkey capped an intense period
of GOT legal reform. Since 2001, the GOT has adopted two
major constitutional reforms and eight wide-ranging
legislative packages. Many of the most significant reforms
were adopted under the current AK Party (AKP) government,
which came to power in November 2002. The reforms include
legal changes designed to crack down on torture, ensure
gender equality, and expand the rights of expression,
association, and religion. Under the reforms, the
State-owned TRT media company has begun news broadcasts in
Kurdish and other minority languages, albeit under tight
restrictions, and Kurdish language courses have been opened
in several cities. Parliament in September adopted a new
Penal Code that includes longer prison terms for those
convicted of torture and "honor killings" (the killing by
immediate family members of women suspected of being
unchaste). The GOT is planning to adopt additional reform
measures before the December EU Summit, including new, less
restrictive laws governing associations and foundations. The
EU, USG, and other outside observers have noted that
implementation of the reforms has lagged in many cases, in
part due to obstructionism by elements of the bureaucracy
opposed to reform. The GOT has established a high-level
Reform Monitoring Group, chaired by FM Gul, to identify and
try to overcome such obstacles.

--------------------------------
GOT Leaders Positive About EU...
--------------------------------

4. (U) GOT officials believe the Commission's October 6
reports pave the way for the opening of accession talks in
2005 (reftel A). Embassy contacts say they accept many of
the caveats contained in the reports. For example, they note
that language recommending that accession talks be suspended
in case of a "serious and persistent breach" of democratic
principles mirrors language used for Croatia. They also
accept the EU's stated intention to monitor how the GOT
implements reform legislation over time, noting that GOT
leaders have pledged to follow through on the new laws. PM
Erdogan, FM Gul, and other top leaders have focused their
public statements on the positive elements of the reports,
noting that the Commission recognized Turkey's progress on
human rights reform and recommended that the EU open
accession talks.

--------------------------
...But Raise Some Concerns
--------------------------

5. (U) At the same time, however, the GOT is concerned about
several elements of the Commission reports, including:

-- The Commission states that accession talks will be "an
open-ended process whose outcome cannot be guaranteed
beforehand;"

-- The Commission proposes the establishment of a screening
process that would precede the opening and closure of each
chapter of the accession talks; and

-- The Commission indicates that the EU might place permanent
restrictions on the free movement of Turkish workers.

6. (SBU) The Turks argue that the EU would be subjecting
Turkey to different standards than those applied to other
candidates if it were to implement these elements of the
report. GOT officials are lobbying behind the scenes to
ensure that EU leaders do not include similar language in the
EU Council report in December. Representatives from some EU
states have told the Turks the caveats in the reports are
unimportant and will not undermine Turkey's EU candidacy.

7. (SBU) Contacts from EU embassies tell us the GOT should be
careful not to pursue their concerns too aggressively. The
October 6 reports represent the best possible outcome for
Turkey, given that some Commissioners oppose Turkey's
candidacy, as do many EU citizens. They warn that by
complaining too loudly the Turks only undermine their backers
in the EU, many of whom are working against public opinion in
their countries to support Turkey's candidacy. The GOT needs
to recognize that Turkey's candidacy is controversial in
Europe. The GOT may feel pressure to address elements of the
Commission reports that are unpopular in Turkey, but EU
membership is overwhelmingly popular among Turks. The GOT
should be able to manage any public anxiety about some of the
language in the reports. You can help influence the GOT's
approach to the EU by encouraging your Turkish interlocutors
to focus on the most important element of the Commission
reports -- the recommendation that the EU begin accession
talks with Turkey. You can also explain the challenges faced
by Turkey's supporters in the EU.

------------------------------------------
Some Press, Opposition Voices Criticize EU
------------------------------------------

8. (U) Some in Turkey are circumspect about the Commission
reports, or even hostile. President Sezer called on the EU
Council in December to remove "negative elements" of the
reports, and emphasized the need to protect national
interests during accession negotiations. Onur Oymen, an MP
from the opposition Republican People's Party (CHP, the only
party other than the ruling AKP to hold a significant number
of seats in Parliament) told us the Commission reports are
"below our expectations." Devlet Bahceli, chairman of the
Nationalist Movement Party (MHP), declared during a press
conference that the EU is trying to "justify terrorism" and
"insult the Turkish State." Various pundits in both the
nationalist and Islamist press also criticized the
Commission.

9. (U) In particular, a range of political leaders and
commentators slammed the Commission for referring to Kurds
and Alevis as "minorities." In Turkey, the term "minority"
has a legal meaning tied to the 1923 Lausanne Treaty. The
Turkish State interprets the Treaty as conferring minority
status exclusively to three non-Muslim religious groups:
Greek Orthodox Christians, Armenian Orthodox Christians, and
Jews. EU and GOT officials are currently discussing the
issue; Ambassador Kretschmer, head of the EU Representation
to Turkey, has said publicly that the official GOT definition
of "minority" may violate a number of international
conventions signed by Turkey (reftel B).

------
Cyprus
------

10. (SBU) On Cyprus, we are taking modest but consistent
steps to help ameliorate the isolation of the Turkish
Cypriots and prepare them for eventual reunification of the
island, while not recognizing the so-called "TRNC": expanded
contacts with "TRNC officials;" extended validity U.S. visas
for Turkish Cypriots; expanded opportunities for USG
officials to travel to north Cyprus; $30.5 million to help
Turkish Cypriot economic development; and increased
scholarships for Turkish Cypriot students. The highest
priorities for Turkish Cypriots and the Turkish government
are direct trade and direct flights between the U.S. and the
north. We have taken steps forward on both. Our
Agricultural Attache accompanied a USG-sponsored Turkish
Cypriot delegation to a Paris trade show in October, and
earlier this month he visited North Cyprus to conduct a
business seminar. A TSA team conducted an informal security
survey of North Cyprus' Ercan Airport in October. ROC
President Papadopolous is threatening to veto Turkey's being
given a date to begin EU accession negotiations unless Turkey
makes concessions on Cyprus before the December 17 EU Summit.
However, the EU's perceived failure to move forward
effectively on direct trade and aid for the Turkish Cypriots
has made concessions practically impossible for Ankara.
According to EU colleagues here, Papadopolous' demands have
not yet gained support.

----
Iran
----

11. (SBU) PM Erdogan visited Tehran in late July, but Iranian
hardliners scuttled a reciprocal visit to Turkey by President
Khatami in September. Turkey has urged Iran to cooperate
with the IAEA and EU-3. Some -- but not all -- Turkish
officials share our concern and sense of urgency on Iran's
nuclear program. Gas is a major topic between both
countries, but for different reasons: Turkey wants to
re-negotiate a more favorable price to its 1996 gas deal with
Iran; Iran wants Turkey to agree to export gas to the EU.

--------
Caucasus
--------

12. (SBU) Attempts to unblock Turkish-Armenian relations are
at a standstill; Turkey will not open the border with Armenia
or restore diplomatic relations absent Armenian concessions
on Nagorno-Karabakh and other occupied Azeri territory.
Meanwhile, Turkish-Azeri relations, based on ethnic and
religious ties, remain strong. Turkey has recently played a
constructive role in Georgia, supporting Georgian
independence and territorial integrity during the Ajara
crisis and urging restraint by all sides in South Ossetia.
Turkey seeks to expand bilateral trade, and is providing
equipment and training to the Georgian military in
coordination with us through the OSD/EUCOM-led Caucasus
Working Group.

----
Iraq
----

13. (SBU) The GOT shares our goal of a unified, prosperous,
secure Iraq at peace with its neighbors and contributes to
that objective while harboring concerns about developments
there. Turkey allows us to ship sustainment supplies and
humanitarian fuel through Turkey to Iraq and perform some
related operations through Incirlik Air Base. Ankara offered
troops last fall, but due to Iraqi sensitivities we and the
Turks decided it better that they not go. Bilateral trade,
expected to reach $1.8 billion in 2004, is growing rapidly.
Despite serious security challenges -- anywhere from 30-60
Turks have been killed by insurgents, with more casualties as
the insurgency intensifies -- the GOT has kept the border
open (on average 1500 Turkish trucks cross into Iraq every
day). There are also about 1,000 Turkish contractors in
Iraq working in support of the coalition. Turkey has pushed
both the Iraqis and us to enhance security measures for
Turkish truck drivers; both of us have done so, but attacks
regrettably continue. The GOT is especially concerned about:
Kirkuk, where uncontrolled Kurdish IDP flows threaten to
ignite ethnic tensions and, they fear, undermine Iraq's
territorial integrity; and the continued presence in northern
Iraq of the terrorist PKK/Kongra Gel, which has stepped up
its attacks in Turkey in recent months.

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Economy
-------

14. (SBU) With the support of the international community,
Turkey has recovered strongly from the financial crisis of
2000-2001. After falling by 9.4 percent in 2001, real GDP
increased 7.8 percent in 2002 and 5.9 percent in 2003. So
far this year, the economy is growing at an annual pace of
over 10 percent. Consumer price inflation, which peaked at
69 percent in 2001, has declined to under 12 percent per year
-- a 30-year low -- and interest rates have fallen from 77
percent to 22 percent and the lira is trading in a stable
range. However, Turkey's financial recovery remains
vulnerable due to a large current account deficit, which
could reach 5 percent of GDP this year, and a large debt with
a short-term maturity structure. At the same time,
unemployment and poverty rates remain high, and ordinary
people have not felt much benefit from the overall
macroeconomic improvement. Macroeconomic success has also
bred a sense of complacency about the need to persist with
the pervasive structural reforms required for Turkey to
attract the large amount of domestic and foreign investment
it needs to sustain high growth and improving living
standards. In addition to greater progress on delayed
privatization plans, reforms of the banking system, social
security system, tax system and business environment are
necessary. These issues are being addressed in the current
negotiations of a new 3-year IMF stand-by program.

15. (SBU) Due to its historical economic and political
volatility and its opaque regulatory, legal, and judicial
environment, Turkey has long received far less than the
amount of foreign direct investment received by other
countries of similar size and potential. As was the case for
other "convergence countries," some GOT leaders expect a
flood of foreign investment if Turkey gets a date for EU
accession negotiations. However, this is unlikely to
materialize until Turkey gets more serious about
privatization and business climate reforms. The process of
adopting the European Community's acquis will reinforce
macroeconomic progress, but most of all help institute
widespread microeconomic reforms to attract investment, boost
productivity and sustain rapid growth needed to reduce
underdevelopment in large portions of the economy. However,
there is a widespread misunderstanding of the enormous
challenges that Turkey will face in the accession process.
As a result, Turkey is poorly prepared to shoulder the
administrative burdens of the accession negotiations,
adopting and implementing the acquis, and managing the
transfer of funds and implementation of programs under EU
pre-accession funds. The Turks also underestimate how
thoroughly the adoption of the acquis will affect every
aspect of how the economy functions and nearly every other
aspect of their lives. In addition, Turkish officials do not
acknowledge how costly Turkey's membership could prove. For
example, bringing Turkey's environmental infrastructure up to
EU standards will cost more than 60 billion Euros. In a
country where nearly a third of the labor force works on
farms, agricultural reform will be particularly challenging,
as will overcoming persistent poverty and regional income
disparities in a country whose per capita income is 27
percent of the EU-15 average, and where living standards in
large regions of the country are closer to those in the Third
World than the EU.

EDELMAN

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