Cablegate: Turkey-Iraq Jec Formulates Economic Roadmap

VZCZCXRO1378
PP RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUEHAK #6526 3331401
ZNR UUUUU ZZH
P 291401Z NOV 06
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC PRIORITY 0104
INFO RUCPDOC/USDOC WASHDC PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RUEHIT/AMCONSUL ISTANBUL PRIORITY 1704
RUEHDA/AMCONSUL ADANA PRIORITY 1378
RUCNRAQ/IRAQ COLLECTIVE

UNCLAS ANKARA 006526

SIPDIS

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ETRD ECON PREL TU IZ
SUBJECT: TURKEY-IRAQ JEC FORMULATES ECONOMIC ROADMAP

Ref: A) Ankara 5844 B) Ankara 6487

Sensitive but Unclassified. Not for Internet Distribution.

1. (SBU) Summary: In a November 15 - 17 meeting of the Turkey-Iraq
Joint Economic Committee (JEC), Turkey laid out what it called a
roadmap for long-term economic cooperation and integration with its
Iraqi neighbors. Turkish Foreign Trade Officials continue to
emphasize Turkey's interest in expanding trade with Iraq, but the
vision remains general and contingent on the establishment in Iraq
of a political order that is acceptable to Turkey. End Summary.

2. (SBU) Turkish Foreign Trade Undersecretariat (FTU) officials told
us that the November 15 - 17, 2006 meeting of the Turkey-Iraq JEC
(ref A) resulted in a roadmap for long-term economic cooperation and
integration of the two economies. Turkish State Minister for
Foreign Trade, Kursad Tuzmen, and Iraqi Oil Minister, Hussain
Al-Shahristani, chaired the meetings. We e-mailed the Agreed
Minutes to Embassy Baghdad and to EUR/SE, and NEA/I.

3. (SBU) In a November meeting, Foreign Trade Undersecretariat
Director General, Sevket Ilgac, referred to the Agreed Minutes as a
"roadmap" for the future integration of the two economies and Iraq's
economic development. The two sides agreed to work together to
conclude a preferential trade agreement, a double taxation treaty,
and a bilateral investment treaty. They agreed to open second and
third border crossings and to create "border trade centers," as well
as to enhance air, road, and transportation hubs and Turkish
electricity exports. The two sides also agreed to exchange
agricultural information and for Turkey to provide assistance on
animal disease and veterinary cooperation. Looking even further into
the future to the creation of a free trade area, the Turks gave the
Iraqi delegation a copy of Turkey's preferential trade agreement
with Georgia (which he said will be signed in the next few weeks) as
an example of the type of agreement Turkey would eventually like to
sign with Iraq. Ilgac also emphasized Turkey's support for Iraq's
future membership in the WTO. Ilgac stressed that realigning this
vision of a comprehensive relationship would require political and
security stabilization in Iraq.

4. (SBU) The delegates also reached agreement on closing out the
settle the remaining balances in the accounts in Turkey established
under the Saddam-era Border Trade Agreement (BTA). Under this
barter agreement, Iraq accepted Turkish goods in return for oil
shipments to Turkey. At the time of the 2003 war, there remained a
balance in favor of Iraq. A technical meeting on fuel trade
issues focused mostly on SOMO shipments from Turkey to Iraq and the
ongoing payment issues (ref B).

5. (SBU) Comment: While problems in fuel trade continue to dominate
current trade discussions between Iraq and Turkey, FTU officials
emphasized again their keen interest in developing stronger trade
relations with Iraq in the long-term interest of both countries.
For the moment the ideas remain general and details undefined, but
holding out the prospect of an eventual bilateral free trade
agreement shows the potential for mutual economic development should
Iraq achieve a form of political stability that Turkey finds
acceptable. End comment.
WILSON

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