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Cablegate: Ambassador Wilson Meets with Cargill

VZCZCXYZ0004
PP RUEHWEB

DE RUEHIT #0553 1781234
ZNR UUUUU ZZH
P 271234Z JUN 07
FM AMCONSUL ISTANBUL
TO RUEHC/SECSTATE WASHDC PRIORITY 7208
INFO RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY

UNCLAS ISTANBUL 000553

SIPDIS

SIPDIS
SENSITIVE

DEPARTMENT FOR EUR/SE
COMMERCE FOR 4200/ITA/MAC/EUR/OECA AND
3150/ITA/USFCS/OIO/CEENIS/MCOSTA

E.O. 12958: N/A
TAGS: EINV EAGR BEXP TU
SUBJECT: AMBASSADOR WILSON MEETS WITH CARGILL
REPRESENTATIVES

Sensitive but Unclassified. Please protect accordingly.

1. (SBU) Summary. Van Yeutter, Director of International
Business Development for Cargill, Inc., and Mustafa Sayintac,
CEO of Cargill-Turkey, told Ambassador and CG officers on
June 7 in Istanbul that Cargill-Turkey's largest factory,
which was ordered to close down last year, remains open
pending a Constitutional Court ruling on a law passed earlier
this year that legalized the plant's location on protected
agricultural land. End summary.

BACKGROUND ON CARGILL AND ITS ORHANGAZI PLANT
-------------------------------

2. (SBU) Cargill, Inc. is an international provider of food,
agricultural and risk management products and services with
over 150,000 employees in 66 countries. The company is based
in Minneapolis and maintains its Turkey head office in
Istanbul. Cargill-Turkey operates three factories in the
country. Its largest, a corn sweetener plant in Orhangazi,
was ordered to cease operations in 1996 after it was deemed
to have been built on protected agricultural land. Cargill
challenged the order in court and after eight years of
litigation, the Administrative Board of the High Court of
Appeals upheld the decision to shut down the Orhangazi plant.

3. (SBU) The Turkish parliament passed a bill on November 24,
2006 that would have granted Cargill-Turkey and several
thousand other companies amnesty, but the bill was vetoed by
President Sezer two weeks later. Parliament overruled the
veto in a second vote on February 1, 2007, but on February 9
Sezer exercised his prerogative to refer parts of it to the
Constitutional Court for review. A final judgment in this
case is still pending.

DISCUSSION
----------

4. (SBU) Yeutter said he was sent to Istanbul to examine
possible options for a resolution of the Orhangazi issue. He
noted that chances of a legal judgment in favor of
Cargill-Turkey are "very slim." The company expects further
challenges from NGOs in local courts and from local
government officials. Because Cargill has been unable to make
any headway on the legal front concerning the Orhangazi
issue, the company is hoping to reach a political solution to
it.

5. (SBU) Yeutter said that if the plant is forced to close,
Cargill would institute international arbitration proceedings
against the Turkish government and expressed confidence that
the company would win such a case.

6. (SBU) Comment: The AKP government has been supportive of
a resolution of the legal case favorable to Cargill. Given
that Turkey is currently in the midst of an election
campaign, an aggressive intervention by the government in the
court case seems unlikely. Ambassador also recommended that
Yeutter and Sayintac reach out to opposition political
parties that could become more influential following the
elections. End Comment.
JONES

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