VZCZCXYZ0004
RR RUEHWEB

DE RUEHAK #6505 3311054
ZNR UUUUU ZZH
R 271054Z NOV 06
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 0070
INFO RUEHIT/AMCONSUL ISTANBUL 1689
RUEHRC/DEPT OF AGRICULTURE WASHDC
RUEHGV/USMISSION GENEVA 1517

UNCLAS ANKARA 006505 
 
SIPDIS 
 
SENSITIVE 
 
SIPDIS 
 
USTR FOR S. DONNELLY, L. ERRION, A. STEVENS, J. WEISS 
USDA/FAS OCRA FOR ALEXANDER AND FLEMINGS 
 
E.O. 12958: N/A 
TAGS: ETRD EAGR WTRO TU
SUBJECT: TURKEY CONTINUES TO SEEK WTO RICE SETTLEMENT 
 
REF: STATE 183957 
 
SENSITIVE BUT UNCLASSIFIED. 
 
¶1.  (SBU)  We met November 22 with Foreign Trade Undersecretariat 
Director General Sevket Ilgac to discuss ways to improve cooperation 
on IPR issues in advance of the regular Special 301 cycle (reftel). 
Ilgac appreciated the demarche and instructed his staff to work with 
the embassy on the various issues identified in the talking points. 
He noted that such a cooperative approach to solving issues was in 
keeping with the spirit of the most recent TIFA consultations, and 
said he would suggest a date soon for a next round of TIFA talks in 
Washington. 
 
¶2.  (SBU)  Changing the topic, Ilgac said he was very concerned 
about the apparent inability to make progress on a negotiated 
settlement to the rice import dispute that the United States has 
brought to a WTO panel.  He asserted that Turkey has stopped 
permanently all the restrictive import practices to which the United 
States objected and that it had several times indicated a desire for 
a negotiated settlement, and readiness to sign a binding settlement. 
 He said that Minister Tuzmen wrote directly to USTR Schwab about 
Turkey's desire for a bilateral settlement.  In the meantime, he 
said there has been no response from the United States other than 
the one implicit in the continued pursuit of panel proceedings. 
 
¶3.  (SBU)  Ilgac said this dynamic has led FTU to suspect that the 
United States has "other objectives" in pursuing this case in 
Geneva.  Ilgac said that if this is the case, to please inform FTU 
so that they can address the U.S. concerns.  In the meantime, he has 
asked his deputy Hasan Yalcin to propose a new text of an 
agreement. 
 
¶4.  (SBU)  Meanwhile, a influential and prominent rice trader 
without whose cooperation and information the case could not have 
been built, told AgCouns November 14 that he is scared to talk to 
the United States anymore as he is threatened with tax and customs 
audits.  He offered to serve as an intermediary for informal 
bilateral discussions to resolve the issue and mentioned an offer by 
FTU to lower the tariff on U.S. rice to zero.  He also said that FTU 
threatened to lower the tariff on Egyptian rice to zero of the 
United States did not settle.  While there may be some "Turkish 
conspiracy" thinking in this account, it is still noteworthy. 
 
¶5.  (SBU)  Comment:  In contrast to some of his predecessors (and 
colleagues) Ilgac is a straight-shooter who has consistently shown a 
desire to improve trade relations with the United States.  His tone 
suggested that lack of progress on a settlement to the rice issue 
has become a greater concern within the GOT.  At the same time, it 
appears that FTU trade bureaucrats are extremely nervous about the 
prospect of Turkey losing a panel decision on their watch.  This 
suggests that the window is now open to move forward with clear U.S. 
terms for a settlement and to engage in bilateral consultations on 
the subject with the GOT.  But this window won't stay open long; if 
we are interested in a negotiated settlement, we need to move now 
before the Turkish position solidifies. 
WILSON