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UNCLAS SECTION 01 OF 05 ANKARA 009080 
 
SIPDIS 
 
 
SENSITIVE 
 
 
STATE FOR THE SENIOR ADVISOR TO PM A/S, PM/B, AND EUR/SE 
DOD FOR OSD/PA&E, OASD/ISA/EUR, OASD/ISA/NP, OASD/ISA/AP, 
OASD/ISA/NESA, OASD/ISA/BTF 
 
 
E.O. 12958: N/A 
TAGS: MCAP PREL TU NATO
SUBJECT: 2003 REPORT TO CONGRESS ON TURKISH CONTRIBUTIONS 
TO THE COMMON DEFENSE 
 
 
REF: STATE 219916 
 
 
¶1. This is Embassy Ankara's submission to the 2002 Report to 
Congress on Allied Contributions to the Common Defense. 
 
 
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General Assessment 
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¶2. (SBU) Turkey experienced a major political change in 2002 
when the governing coalition of Prime Minister Ecevit began 
to dissolve in July, and November general elections brought 
to power the Islam-influenced AK Party in a majority (vice 
coalition) government.  The outcome of the election was 
viewed as a public outcry against the often corrupt and 
ineffective parties that have rotated through government 
since the late 80's.  The AK Party's defense and security 
policies are still somewhat unclear, but the Turkish General 
Staff (TGS) is certain to maintain its significant influence 
in the National Security Council and provide consistency to 
Turkey's defense and security policies. 
 
 
¶3. (SBU) Throughout the political debate Turkey experienced 
in the last half of 2002, the GOT continued to negotiate a 
participation agreement in the EU's ESDP in exchange for 
assured access to NATO planning assets.  The negotiations 
culminated in an agreement in December that allows NATO and 
the EU to proceed with "Berlin Plus" arrangements.  Turkey 
has committed forces to the ESDP's Headline Goal and 
encouraged the "Turkish Republic of Northern Cyprus" to 
continue UN-brokered negotiations in hopes of resolving the 
Cyprus problem to improve Turkey-Greece/Turkey-EU relations 
and further its goal of becoming an EU member. In December 
2002, the EU committed to reviewing Turkey's compliance with 
the Copenhagen Criteria in December 2004 in order to begin 
accession negotiations thereafter. 
 
 
¶4. (U) The Turkish General Staff (TGS) continues to support a 
military modernization program that should increase the 
capacity of Turkey to meet its NATO responsibilities. 
However, the GOT's ability to finance its previously 
announced 30-year, USD 150 billion program remains seriously 
hampered by the government's precarious financial situation, 
particularly an enormous public debt load that siphons off 
most revenues.  Under the best of circumstances, maintaining 
solvency will require the government to live within a very 
tight budget for the next several years.  This has limited 
and will continue to limit funds available for new military 
spending.  If Turkey is able to achieve growth of 5 percent 
or more beginning in 2003, there should be room for some 
minor increases in defense spending, but the military will 
face competition for budget resources from social programs, 
which are on the top of the new government's agenda. 
Turkey's 2002 National Defense Budget was reportedly $4.7 
billion, based on an exchange rate of $1=1.65 million Turkish 
Lira, representing 8.5 percent of the national budget and 3 
percent of GNP.  (The defense budgets in 2000 and 2001 were 
$6.6 billion and $4.3 billion respectively.)  Approximately 
25 percent of the defense budget is allocated for personnel 
expenditures.  The Defense Industry Support Fund, which is 
independent of the defense budget (and not made public), was 
expected to reach $.7-$1 billion when including funds carried 
over from 2001.  Of that amount 90 percent was intended for 
procurement projects. 
 
 
¶5. (U) In this fiscal environment, TGS has continued its 
indefinite postponement of 32 projects, including 20 
utility/heavy-lift helicopters and the Turkish main battle 
tank program, which was planned to replace Turkey's legacy 
tank fleet.  TGS is now focusing on upgrading its M-60 fleet 
and has awarded the modernization contract to the Israeli IMI 
consortium.  The Turkish Attack and Reconnaissance Helicopter 
(ATAK) direct commercial sale (DCS) project has been delayed 
but is still in the contract negotiating phase.  Although US 
Bell-Textron was selected as the primary candidate for the 
project, the negotiations were stalled at year's end.  The 
GOT started formal negotiations with the secondary contractor 
(the "Kamov" Israeli/Russian Defense Industry consortium) in 
¶2002.  The Airborne Early Warning and Control (AEW&C) DCS 
project has experienced delays, but the contract has been has 
been awarded, the US Congress has agreed to the contract, and 
the project is expected to proceed successfully.  The GOT has 
received and is evaluating contractor proposals to procure 
eight strategic unmanned aerial vehicles (UAV) but is 
expected to defer announcing down selection or awarding the 
UAV contract until well into FY03. 
 
 
¶6. (U) On July 11, 2002 Turkey and the US signed a $175 
million Memorandum of Understanding for Turkish partnership 
in the Joint Strike Fighter (JSF) Systems Development and 
Demonstration (SDD) Phase.  As a Level III partner, Turkey 
will participate with the United Kingdom, Italy, Netherlands, 
Canada, Denmark, and Norway.  Over the next 10 years of the 
SDD phase, Turkey's investment will enable it to share in the 
technological exchange that marks this program as the largest 
investment in research and development that Turkey has made 
to date. 
 
 
¶7. (U) Throughout the reporting period, the GOT continued its 
support of UN and NATO humanitarian and peacekeeping efforts. 
 Furthermore, the Turkish-American "strategic partnership" 
dramatically broadened and deepened in 2002, beginning with 
Turkey's agreement to take over from the UK as the lead of 
the International Security Assistance Force (ISAF) in 
Afghanistan and continuing with the ongoing discussions over 
the future of Iraq. 
 
 
¶8. (U) Turkey officially took over leadership of ISAF in June 
for a six-month term due to expire in mid-December and has 
since agreed to extend its leadership until mid-February 2003 
to give Germany and the Netherlands time to prepare for the 
role.  Ankara continues to place emphasis on stability in the 
Caucasus and central Asia, committing approximately $30 
million over the last five years to upgrading the Georgian 
military's ability to maintain control of its territories. 
TGS continues to coordinate security assistance to the 
Caucasus with the US through the OSD-led Caucasus Working 
Group. 
 
 
¶9. (SBU) Turkey's contributions to the war on terrorism have 
been substantial.  The GOT's long-time leadership in the area 
of counterterrorism and consistent support of US efforts 
since 9/11 have underscored its role as one of the United 
States' key allies.  Its strategic location and distinction 
as the only Muslim NATO Ally have further demonstrated 
Turkey's importance to the US and NATO.  Turkey has 
participated actively in GWOT.  In doing so, Muslim Turkey 
has supported our message that GWOT is not a war on Islam. 
In the aftermath of 9/11, the Turks issued strong public 
statements condemning the attacks, and, in the face of 
considerable public opposition, pushed through a 
parliamentary resolution authorizing the deployment of 
Turkish troops abroad for Operation Enduring Freedom (OEF) 
and the stationing of additional foreign troops in Turkey. 
Turkey was one of the first countries to offer troops for 
OEF. Turkey also streamlined customs procedures for equipment 
used for OEF, granted blanket permission for US OEF aircraft 
to operate and refuel in Turkish airspace (over 8,000 sorties 
to date), dispatched liaison officers to CENTCOM, EUCOM and 
to Kandahar, offered the use of additional air bases for 
operations through Turkey, offered two KC-135 tankers in 
support of air operations, and increased its force protection 
posture at US military facilities in the country. 
 
 
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Direct Cost-Sharing 
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¶10. (U) In accordance with current bilateral agreements, the 
USG has not sought a direct GOT contribution toward the costs 
associated with the stationing of US forces in Turkey. 
However, Turkey significantly increased its security presence 
at all US facilities for approximately four months following 
9/11, and the Turkish National Police provided unmarked cars 
at all US living quarters for a period of time. 
Additionally, on September 11, 2002, the GOT significantly 
increased force protection with additional military and 
police presence. 
 
 
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Indirect Cost-Sharing 
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¶11. (U) Turkey continues to play a major role in Operation 
Northern Watch (ONW), which is mandated to enforce the no-fly 
zone over northern Iraq.  Turkey's parliament renews its 
legislative commitment to host ONW at Incirlik Air Base every 
six months and remains a major ally, teamed with the US and 
UK, in the critical UN-mandated mission.  Despite repeated 
Iraqi threats of retaliation against Turkey and significant 
lost trade, the GOT remains a strong supporter of ONW.  US 
military aircraft do not pay landing fees in Turkey to land 
at Turkish military air fields (estimated value: USD 2 
million) but do pay to land at commercial airfields. 
 
 
¶12. (U) Indirect cost-sharing in the form of foregone rent of 
GOT-owned land and facilities used at no cost by the USG is 
calculated as follows: 
 
 
Office of Defense Cooperation, Ankara 
 
 
-- Land (11,120 sq m of land valued at $18.30/sq m, based on 
prevailing fair market value of land in that district) = 
$216,113; 
 
 
-- Prevailing fair market value of headquarters building 
(5,500 sq m), motor pool and shop (620 sq m), and parking lot 
(5,000 sq m) adjusted for inflation is $328,000/year. 
 
 
US-utilized land at Incirlik Air Base (all buildings and 
facilities are built and paid for by the USG): 
 
 
-- 13,477,700 sq m at the fair market value of $6.47/sq m = 
$87.201 million annually. 
 
 
Total Foregone Rent of GOT-owned land/facilities = 
$87,745,113/year. 
 
 
¶13. (U) Forgone Tax/Customs revenue: 
 
 
American military activities and personnel assigned to Turkey 
are exempt from all income, corporate, stamp taxes and 
customs duties.  The estimated forgone revenue is calculated 
as follows: 
 
 
-- Turkey-wide PX/Commissary sales, valued at over $23.3 
million annually, at an average VAT rate of 22 percent is 
estimated to be $5.128 million annually; 
 
 
--Forgone customs duties on personal property, personal 
vehicles, supply equipment, weapons and munitions, military 
vehicles, and local purchases at an average VAT rate of 18 
percent is estimated to be in excess of $12.24 million 
annually. 
 
 
Total Foregone Tax/Customs = $17.368 million 
 
 
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Grant Aid, Peacekeeping, Humanitarian Assistance, Current 
Contingency Operations, Counterproliferation, and Nuclear 
Threat Reduction 
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¶14. (U) Because of its cultural, historic, and even familial 
ties to the Balkans, Turkey continues to be a supporter of a 
robust Western presence in the former Yugoslavia.  Turkey 
supports KFOR with a mechanized infantry battalion task force 
of approximately 752 personnel.  It has supported SFOR since 
1996, currently with about 498 people in a mechanized 
battalion task force, with one company of the task force 
assigned to the security of SFOR headquarters.  Turkey has 
also assigned one frigate, three F-16 fighters, and one 
minesweeping vessel that can be provided upon request for 
support of SFOR and/or KFOR.  In FYROM, there is a 40-person 
Turkish national support element.  Other Turkish involvement 
in current peace operations include five observers in UNIKOM 
(Kuwait), seven observers in UNIMOG (Georgia), 37 police 
officers for IPTF (International Police Task Force in 
Bosnia), and 18 observers for TIPH (Temporary International 
Presence in Hebron), and ONW liaison officers.  Turkey has 
committed up to five thousand troops to the EU's rapid 
reaction pool, including one mechanized brigade, one F-16 
squadron, two C-130 or C-160 transport aircraft, two 
frigates, one submarine, one support vessel, and one 
amphibious ship. 
 
 
¶15. (U) By far the GOT's most substantial contribution to 
peacekeeping and humanitarian assistance in this reporting 
period was its leadership of ISAF from June 2002 to 
mid-February 2003, involving the commitment of nearly 1400 
Turkish personnel and 150 vehicles to Afghanistan.  The 
Turkish General Staff (TGS) estimates that ISAF leadership 
costs Turkey approximately $9 million dollars per month.  In 
addition to its ISAF leadership, Turkey played a leading role 
in the training of the first national guard battalion and 
donated uniforms and equipment for those 600 soldiers. 
Turkey continues to coordinate closely with the USG in 
providing additional training to the Afghan National Army. 
On the humanitarian front, Afghan reconstruction projects 
completed with Turkish assistance now total $2.8 million, and 
the GOT has committed $1.5 million for 2003.  $4.5 million 
has been set aside for possible future use.  Turkey is 
focusing its reconstruction efforts in four areas: 
healthcare, training, agriculture and gender issues projects, 
such as those that address women's and children's issues. 
Completed projects breakdown as follows: 
 
 
-- $ 314,000 for medicine, medical supplies and equipment, 
cash assistance to 
hospitals; 
-- $ 1,760,000 for training of doctors, diplomats, water 
experts, teachers; 
-- $ 200,000 for infrastructure (telephone network 
installation); 
-- $ 23,800 for baby food; 
-- $ 608,936 cash to Afghanistan Reconstruction Trust Fund 
(ARTF) and early support to 
the Afghanistan Interim Authority Fund (AIAF). 
 
 
¶16. (U) To pursue its goals of stability and westernization 
in the region, Turkey provides military equipment, education 
and training to personnel from Central Asia and the Caucasus, 
especially Georgia, where it has committed over $30 million 
dollars over the last five years. Some 30 Turkish military 
advisors are in Georgia and have trained more than 400 
Georgian special forces and border guards.  TGS coordinates 
with the US its assistance to the Caucasus and Kazakhstan 
through the OSD-led Caucasus working group, which met three 
times in 2002.  In 2002 Turkey provided training/education at 
various Turkish military institutions to 1200 guest military 
personnel from some 30 countries.  It has bilateral military 
training, technical and scientific cooperation agreements 
with almost 60 countries. 
 
 
¶17. (U) Turkey has actively supported the US in pursuing the 
adaptation of NATO to a post-Cold War world.  Ankara has 
expressed its support for the NATO Rapid Reaction Force, 
niche capabilities, and missile defense.  Its commitment to 
the Partnership for Peace is evident in its Ankara PfP 
Training Center, which has trained more than 2200 students 
from 45 NATO, PfP and Mediterranean Dialogue countries in 
courses ranging from "Peacekeeping Operations Management" to 
"Refugee Relief."  The GOT budget to support participants in 
the PfP training center is approximately $150,000 per year. 
During 2002, Turkey participated in 11 PfP or Spirit of PfP 
exercises.  Furthermore, TGS has invested substantial 
resources into renovating its 3rd Corps Headquarters in 
Istanbul to make it suitable for hosting a NATO High 
Readiness Force (HRF) Headquarters.  The Turks fully 
supported NATO enlargement at Prague, particularly in 
southeastern Europe. 
 
 
¶18. (U) Turkey has launched a number of groundbreaking 
regional cooperation mechanisms in southeastern Europe.  It 
continues to be an active participant in the South-East 
European Cooperation Process (SEECP) and the numerous 
initiatives that have emanated from it, including the South 
Eastern Europe Brigade (SEEBRIG), an integrated infantry 
brigade composed of units from Albania, Bulgaria, FYROM, 
Greece, Italy, Romania, and Turkey, with the US and Slovenia 
acting as observers.  Turkey contributes a mechanized 
infantry battalion, a reconnaissance company, an artillery 
battery and some supporting units to SEEBRIG.  In 1997-8, 
Turkey conceived and nurtured the Multinational Peacekeeping 
Force--Southeast Europe (MPFSEE), which operates the on-call 
SEEBRIG.  It was activated in 1999 under a Turkish commander. 
 In 2001, the GOT successfully brought together Russia, 
Ukraine, Romania, and Bulgaria to establish the BLACKSEAFOR, 
an on-call force comprising naval units of the Black Sea 
littoral states. 
 
 
¶19. (U) Turkey is a vigorous supporter of regional 
counterproliferation cooperation.  It is a member of every 
major USG-endorsed arms control and counterproliferation 
regime, including NPT (1969), BWC, (1974), Wassenaar (1996), 
MTCR (1997), CWC (1997), CTBT (1999), NSG (2000), and 
Australia Group (2000).  Since 1999, the GOT has undertaken 
the responsibility for the operation and maintenance of the 
Belbasi Seismic Monitoring Station, an important data source 
for the worldwide comprehensive test ban treaty (CTBT) 
nuclear test-monitoring network.  During 2002, the GOT 
finalized a project to install USG-donated radiation 
detectors at Turkish border crossings.  The detectors are 
intended to deter and, if necessary, interdict smugglers 
trafficking in radioactive material that could be used by 
terrorists or countries of proliferation concern to build 
nuclear weapons. 
 
 
¶20. (U) Since February 1999, TGS and the US Missile Defense 
Agency have been cooperating on a joint missile defense 
architectural study in anticipation of a developing tactical 
ballistic missile threat against Turkey and it NATO Allies. 
Turkey has consistently supported US objectives for pursuing 
missile defense for the Alliance. 
 
 
Point of Contact 
---------------- 
 
 
¶21. (U) Point-of-contact for this report is Pamela Tremont, 
Political-Military Affairs, PMA, tel: 90-312-455-5555 x 2525, 
tremontpm@state.gov. 
PEARSON