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Cablegate: Ambassador Visits Bursa

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

UNCLAS SECTION 01 OF 02 ANKARA 001610

SIPDIS

SENSITIVE

TREASURY FOR OASIA -- CHRIS PLANTIER
EX-IM BANK FOR MARGARET KOSTIC
USAID FOR VALERIE KWOK

E.O. 12958: N/A
TAGS: ECON PGOV EAID TU
SUBJECT: AMBASSADOR VISITS BURSA

REF: ANKARA 5781

SENSITIVE BUT UNCLASSIFIED.

Refs: A) 04 Ankara 4332, B) Ankara 912 and 1090

1. (SBU) Summary. Visiting Bursa, Turkey's fourth
largest city and a leading industrial center, the
Ambassador heard from officials and business leader about
the strain a strong lira and the end of global quotas is
putting on the Turkish textile industry. Officials and
business people were interested in developing new
relationships with the United States, including seeking
Ex-Im Bank support for major municipal projects such as a
light rail system. The Ambassador also highlighted U.S.
financial support for educational and medical assistance
to poor Turkish families. The day-long visit served to
emphasize dimensions of the bilateral relationship that
are too often overlooked as anti-American feeling grows
in Turkey. End Summary.

2. (SBU) Ambassador Edelman paid a visit to the city of
Bursa on March 14. With a metropolitan population of 2.5
million, Bursa is Turkey's fourth largest city and an
important center for the textile, automotive, and
processed foods industries. The first capital of the
Ottomans, Bursa is a site for historical tourism, and
Uludag mountain, which towers over the city is Turkey's
largest ski and winter sports center. Located just
outside Bursa is Cargill's $100 million sweetener plant,
the largest U.S. agricultural investment in Turkey, which
over the years had been plagued with regulatory problems
but is now operating smoothly (ref A).

------------------------------------------
Governor Copes with Crowding and Pollution
------------------------------------------

3. (SBU) Meeting with Bursa governor Oguz Koksal, the
Ambassador expressed appreciation for the provincial
government's support for Cargill. Claiming that the
fears of many in the community that the plant was an
environmental risk had been proven unfounded, Koksal said
he was happy to support the plant as a source of local
jobs and income. According to Koksal, his main issues as
governor are dealing with the traffic and environmental
traffic problems created by the city's rapid population
growth. Noting the importance of the textile industry to
Bursa, Koksal said he was confident that Turkish textiles
would remain globally competitive despite increased
competition from China following the expiration of the
multi-fiber agreement. He said Turkish producers would
have to "move up the value chain" and produce high-
quality goods for the fashion market.

-------------------------------------------
Mayor Looking for Ex-Im Bank for Light Rail
-------------------------------------------

4. (SBU) Mayor Hikmet Sahin, an AK Party member, listed
several projects, including expansion of the city's light
rail system, that were designed to address the congestion
and air and water pollution problems. The main challenge
was financing. He said Bursa would continue to seek U.S.
Ex-Im Bank support for the expansion of Bursa's light
rail system. The Ambassador noted that a U.S. company,
Earth Tech, was interested in the project. According to
the mayor, other major projects in the works include a
new cable car to the ski resort on Uludag, a fast ferry
boat to Istanbul, a wastewater treatment plant for the
dirty Nilufer River, and a municipal natural gas
distribution network that would replace the soft coal
used for home heating. Mayor Sahin also described in
front of the press the importance to Turkey of keeping a
good relationship with the United States.

----------------------------------------
Exporters Worried About Textile Industry
----------------------------------------

5. (SBU) During a luncheon hosted by the Industrialists
and Businessmen's Association of Bursa (BUSIAD), the
city's leading exporters were deeply worried about the
fate of the region's textile industry. The industry is
suffering from the appreciation of the Turkish lira
against the dollar and the euro over the past year as
well as competition from low cost Chinese textile
companies following the end of the textile quota system.
One leading firm said it had recently laid-off over 1000
employees and another complained about what he said was
the WTO's failure to enforce labor and other commitments
China made when it joined the WTO. On the other hand,
representatives of automotive parts makers, several of
whom have joint ventures with U.S. firms, were more
quietly pleased with their success in exporting to
Europe. A maker of plastic playground equipment
described how he had through hard work and perseverance
broken into the U.S. market.

6. (SBU) The Ambassador also thanked BUSIAD for the
support it had extended to Cargill. In response to a
call by one participant for the creation of Qualifying
Industrial Zones (QIZs) that would allow Turkey to export
textiles to the United States duty-free, the Ambassador
described the need for U.S. legislative action and the
political sensitivity of textile imports in both
countries. In any case, the end of the quota system made
such a mechanism less attractive in the textile sector.

--------------------------------------------- --------
Neighborhood Health Clinic Benefits from U.S. Support
--------------------------------------------- --------

7. (SBU) The Ambassador used a neighborhood health
clinic to highlight the recent $9 million USG grant to
the Turkish Government's "Social Risk Mitigation Project"
(ref B). Doctors and patients who were taking advantage
of the program -- which provides small cash payments to
mothers who ensure that their children receive regular
medical checkups and remain enrolled in school --
described how the program was making a measurable
difference for poorer people. The chief doctor, who sees
over 50 patients a day in the crowded center, said that
the payments were "very motivational" for Turkish
families despite their small size.

--------------
Press Coverage
--------------

8. (SBU) The Ambassador's visit received considerable
local and national press attention. In addition to being
followed throughout the day by a pack of journalists (who
were mainly interested in subjects unrelated to the
visit), the Ambassador gave an exclusive interview to a
small local newspaper. All the city's major newspapers
gave front-page coverage, and local television stations
devoted extensive coverage to the visit. The exclusive
interview was published in its entirety, with a front-
page lead. The Ambassador highlighted that the long-
standing U.S.-Turkey friendship is not restricted solely
to international politics, but extends to a wide range of
important bilateral issues. In addition, he answered
questions regarding Turkey's EU membership, Armenia, Iraq
and the problem of anti-Americanism. The Ambassador also
visited the Bursa American Corner located at the
headquarters of the Bursa Chamber of Commerce and
Industry, and had an unremarkable meeting with some
members of the Chamber's board.

-------
Comment
-------

9. (SBU) Bursa is a clearly a dynamic city that is
going through a period of fast growth and change as
Turkey becomes more deeply integrated into the global
economy. The success of the automotive industry and
relative decline of textiles is an example of that
change. The government officials and business community
were interested in expanding the trade and investment
relationship with the United States and are clearly
interested want to pursue Ex-Im Bank financing for the
light rail project. Despite inordinate press focus on
subjects unrelated to the visit (such as President
Sezer's planned visit to Syria), the visit successfully
highlighted dimensions of the bilateral relationship that
are too often overlooked in the context of growing anti-
Americanism in Turkey.
EDELMAN

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