VZCZCXRO2748
RR RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHAK #6542/01 3341448
ZNR UUUUU ZZH
R 301448Z NOV 06
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 0127
INFO RUEHIT/AMCONSUL ISTANBUL 1718
RUEHDA/AMCONSUL ADANA 1382
RUEATRS/DEPT OF TREASURY WASHDC
RUEHZL/EUROPEAN POLITICAL COLLECTIVE

UNCLAS SECTION 01 OF 02 ANKARA 006542 
 
SIPDIS 
 
TREASURY FOR JONATHAN ROSE 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EAID SOCI PHUM PGOV ECON TU
SUBJECT: DEVELOPMENT IN TURKEY'S SOUTHEAST 
 
REF: ADANA 00244 
 
ANKARA 00006542  001.2 OF 002 
 
 
¶1. (U) Summary.  On November 22, TESEV, the Turkish Economic and 
Social Studies Foundation, a leading Turkish NGO, and the UNDP 
released a joint study identifying a series of short-term policies 
to address socio-economic problems in Southeast Turkey.  The study 
offered few new insights as to development approaches, but did 
provide interesting comparisons between Turkey's Southeastern 
provinces and other similarly impoverished world regions based on 
the UNDP's Human Development Index.  Calling for "immediate 
government intervention" to ameliorate the extreme poverty and 
unemployment in Turkey's Southeast, the study's authors advised the 
report's recommendations be implemented "at once and 
simultaneously."  Citing an estimated $1.7 billion price tag for 
implementation of social policy programs alone, the study ignores 
altogether the GOT's limited ability to intervene financially. In 
general, the facts on the ground suggest that development in 
Southeast Turkey may be better served by the government providing 
better security and then getting out of the way to let the private 
sector do its job.  End Summary. 
 
 
------------------- 
TESEV/UNDP FINDINGS 
------------------- 
 
¶2. (U) The study states that all measurable indicators point to 
Eastern and Southeastern Anatolia as the two least developed regions 
in Turkey. Provinces in those areas continuously rank lowest on 
socio-economic development among Turkey's eighty-one provinces.  Per 
capita public investment and per capita GDP in the provinces are 
about one third of the national average.  Although the region has 
ten percent of the national population, it contributes only six 
percent of the GDP.  The study also notes that about sixty percent 
of the population in these provinces lives below the poverty line. 
 
¶3. (U) Noting Turkey's obligation under the EU ascension process to 
reduce regional inequalities, the study compared the region's 
twenty-one provinces with various countries according to the UNDP's 
Human Development Index Values for Provinces (HDI).  Bayburt, for 
example, with the highest HDI score among the twenty-one provinces, 
corresponds to Mongolia and Bolivia in terms of rank and 
development.  Most noteworthy is the fact the average HDI score for 
all the provinces corresponds to Morocco, ranked 124th of 177 
countries on HDI.  The study indicates that ten percent of Turkey's 
population currently lives with an HDI-ranking roughly the same as 
Morocco's.  Perhaps more telling, the study points to per capita 
income levels in Eastern Anatolian provinces, which range between 
seven and sixteen percent of the European Union average, as 
representing the greatest gap between EU candidate and member 
countries. 
 
------------------------------- 
RECOMMENDATIONS FOR DEVELOPMENT 
------------------------------- 
 
¶4. (U) The study identifies agriculture, animal husbandry, private 
enterprise, community-driven development, border trade, and tourism 
as areas of immediate focus for development.  Acknowledging the 
unfeasibility of a uniform agricultural policy, the study recommends 
development and implementation of rural development projects devoted 
to enhancing local capacity.  Notably, the study recommends ending 
the government's regional investment scheme--which the IMF has also 
opposed--as costly and ineffective.   The study proposes public 
investment focused on infrastructure improvements and argues that 
enhancing the physical appearance of the region's cities through 
"community-driven development campaigns"--activities such as 
repairing and painting government house, city halls and 
schools--would attract a more highly trained and qualified workforce 
to the provinces in the short-term.  Characterizing trade with 
bordering countries as crucial for the region, the study proposes 
the construction of "Border Trade Centers" to facilitate trade. 
Based on the approximately 34,000 Iranians touristswho traveled to 
the provinces in 2001, despite minimal hotel facilities, the study 
encourages further public investment in tourism to attract 
additional visitors. 
 
¶5. (U) Education and health care measures were also key areas cited, 
and specific recommendations included providing hot school lunches, 
subsidizing school transportation costs, and providing free 
textbooks.  Given that only a small percentage of the region's 
population is employed in the formal sector, the study argues direct 
income transfers will be one of the most effective instruments of 
social policy.  The study advocates for the elimination of barriers 
to qualifying for the government's "green card" insurance program, 
and also calls for free primary healthcare services.  The study 
estimated the cost of implementing the social policy measures 
 
ANKARA 00006542  002.2 OF 002 
 
 
alone--free books, free lunches, etc.--to be $1.7 billion. 
 
-------------------------- 
REACTION AND REALITY CHECK 
-------------------------- 
 
¶6. (U) Representatives of several political parties, including the 
CHP, AKP, and DYP, reacted to the study's recommendations while 
attending a recent panel discussion.  The panel's moderator, 
economist Guven Sak, critical of the study's failure to prioritize, 
pointed out the impossibility of pursuing all angles at once.  AKP 
representative and panelist Dengir Mir Mehmet Firat defended his 
party's record in the SE, citing efforts to bring more authority to 
local government, to increase the number of teachers, and to 
discourage government doctors from making transfer requests.  He 
also portrayed the SE problem as one caught up in the relationship 
of the individual to the state and challenged the priority of 
"Father State" over the realization of individual rights.  DYP 
representative and panelist Binhan Oguz agreed that focus on 
religious and winter tourism could be a major area of development 
for the region.  Panelist Mehmet Keciciler of Anavatan described the 
citizens of the Southeast as loyal, even as they claimed Kurdish 
descent and spoke Kurdish.  Calling for the elimination of the 
"village guard" and the lifting of restrictions on freedom of 
speech, including on the Kurdish language, he also asked why Turkey 
remained afraid to broadcast in Kurdish, instead leaving satellite 
broadcasts to the PKK.  CHP representative deputy and Algan 
Hacaloglu described a newfond political will to implement the 
report's fndings. 
 
¶7. (U) During a Q & A session, CHP Vice Chairman Onur Oymen noted 
the conspicuous absence from the study of any discussion of 
terrorist activities in the region.  Kudbettin Arzu of the 
Diyarbakir Chamber of Commerce found significant the report's 
recommendation for free or reduced utilities to create a culture of 
responsible bill-paying citizens. 
 
------- 
COMMENT 
------- 
 
¶8. (SBU) No one disputes the need for development of Turkey's most 
impoverished provinces. While the study usefully highlights the 
shocking disparities between the Southeast and Western Turkey, and 
advocates urgent focus on these issues, the question is how to go 
about addressing the region's problems in the most efficient and 
cost-effective manner if the region is to achieve long-term 
development success.  Far from shedding new light on development 
approaches, the study recycles old ideas in abstraction from another 
underlying cause of the poverty and underdevelopment in the region, 
namely the PKK-related security problem.  While this may be an 
understandable effort to avoid potential controversy, it also avoids 
the question of the chicken-egg relationship between security and 
growth.  There is also no discussion of how the recommended programs 
would be funded, given current constraints on the Government budget, 
particularly the investment budget.  The Government's track record 
with earlier large-scale infrastructure projects in the Southeast, 
such as the Southeast Anatolia Project (GAP), gets mixed reviews 
from development experts.  Successes on the ground in Southeast 
cities like Gaziantep (reftel) suggest that creating stable 
conditions for small to medium sized businesses to grow and create 
jobs might be a more reasonable objective than massive 
government-funded public investments. End comment. 
 
WILSON#