VZCZCXRO2240
PP RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUEHAK #5844 2791252
ZNR UUUUU ZZH
P 061252Z OCT 06
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC PRIORITY 9271
INFO RUCPDOC/USDOC WASHDC PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RUEHIT/AMCONSUL ISTANBUL PRIORITY 1430
RUEHDA/AMCONSUL ADANA PRIORITY 1201
RUCNRAQ/IRAQ COLLECTIVE

UNCLAS ANKARA 005844 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ETRD ECON IZ TU
SUBJECT:  TURKEY-IRAQ ECONOMIC MEETING IN NOVEMBER 
 
Sensitive but Unclassified. 
 
¶1. (SBU) Summary:  The next meeting of the Turkish-Iraqi JEC will 
take place November 8-9 in Ankara.  An issue-packed agenda (emailed 
to Baghdad/ECON) will focus on all aspects of the bilateral economic 
relationship, including a potential "preferential agreement" for 
bilateral trade and investment and double taxation agreements. 
Turkey's exports to Iraq nearly uadrupled between 2003 and 2005, 
but this growth came to an abrupt end in 2006.  Turkish trade 
officials emphasize Iraq's enormous potential and Turkey's desire 
for increased trade.  End Summary. 
 
¶2. (SBU) Turkish Foreign Trade Undersecretariat (FTU) officials told 
us that the next meeting of the Turkish-Iraqi Joint Committee for 
Economic and Technical Cooperation (JEC) will take place in Ankara 
on 8-9 November, 2006.  The meeting with be chaired by Iraqi Oil 
Minister, Hussain al-Shahristani, and Turkish State Minister for 
Foreign Trade, Kursad Tuzmen. 
 
¶3. (SBU) The agenda encompasses a wide array of economic and 
technical issues.  The two sides will begin with a discussion of a 
preferential trade agreement, avoidance of double taxation, 
investment protection and reciprocal promotion, and the creation of 
Border Trade Centers at the border crossing points. 
 
¶4. (SBU) In discussing their bilateral trade relations, the two 
sides will focus on closing out the remaining Iraqi funds still held 
in Turkish banks under the Saddam Hussein-era Border Trade 
Agreements (BTAs), which were barter accounts between Iraq and 
Turkey during the sanctions period.  The parties will also discuss 
promotional activities targeting increased bilateral trade, private 
and banking sector cooperation, and export financing programs.  The 
remainder of the two-day meetings will focus on customs, 
transportation, energy, services, agriculture, investment and 
tourism. 
 
¶5. (SBU) FTU Acting DG for Agreements, Sevket Ilgac emphasized 
Iraq's enormous trade potential and Turkey's strong desire to 
strengthen economic ties with the country.  In fact, during the 
period 2003-2005, Turkey's exports to Iraq nearly quadrupled.  This 
growth, however, came to an abrupt end in 2006 and has remained at 
levels consistent with the same period for 2005.  Ilgac opined that 
the reason behind this slowdown had to do with problems at the 
border crossing between the two countries, including construction 
projects and, most recently, customs problems, which caused 
transportation between the two countries to slow considerably. 
Ilgac added, "Besides, you can't have almost 100 percent growth 
every year without end." 
 
¶6. (SBU) Comment:  Ilgac previously served in Iraq and is one of 
FTU's most knowledgeable experts on trade with the country.  He 
personally wants to see Iraqis succeed at self-government and 
believes that strengthened trade will assist them in reaching this 
goal.  In addition, Tuzmen is a major proponent of expanding 
Turkey's trade with its neighbors and was an important participant 
in an Iraq-Turkey trade promotion fair that occurred in the 
southeastern city of Gaziantep (also his parliamentary district). 
We continue to encourage Turkish officials at all levels to find 
ways to cooperate and increase trade with Iraq and lessen the 
bureaucratic and procedural problems that have plagued trade through 
the border gate.  End comment. 
WILSON