VZCZCXYZ0002
RR RUEHWEB

DE RUEHKB #1506/01 3521000
ZNR UUUUU ZZH
R 181000Z DEC 07
FM AMEMBASSY BAKU
TO RUEHC/SECSTATE WASHDC 4485
INFO RUEHAK/AMEMBASSY ANKARA 2539
RUCPDOC/DEPT OF COMMERCE WASHDC
RHMFIUU/DEPT OF HOMELAND SECURITY WASHINGTON DC
RHEBAAA/DEPT OF ENERGY WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RHMFIUU/DEPT OF JUSTICE WASHINGTON DC

UNCLAS BAKU 001506 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
DEPT FOR EEB A/S DANIEL SULLIVAN 
DEPT FOR EUR/CARC AND EEB/CBA 
DEPT PASS TO TDA FOR STEIN, EXIM FOR GLAZER 
ANKARA FOR FCS 
COMMERCE FOR 4231 ITA/MAC/ORUE FOR DSTARKS 
COMMERCE FOR 3004 ITA/FCS/ ADVOCACY FOR ACHAMS-EDDINE 
 
E.O. 12958: N/A 
TAGS: ECON EFIN ETRD EAID PREL ENRG KCOR AJ
SUBJECT: AZERBAIJAN: DRAFT 2008 EPC AGENDA AND DELIVERABLES 
 
 
¶1. (SBU) Embassy passes to Washington colleagues initial 
thoughts for the 2008 EPC agenda items and potential 
deliverables and welcomes Washington's comments, edits and 
additions.  We note that in this early draft of possible 
deliverables, many of the proposed action items are for the 
Government of Azerbaijan; the U.S. will also need to develop 
a similarly robust list of possible U.S. action items. 
Embassy requests Washington's input by mid-January as Finance 
Minister Sharifov has requested a meeting with Ambassador 
Derse during the third week of January to plan for the 
February EPC in Washington.  We especially welcome Washington 
agencies' input. 
 
¶2. (U) BEGIN DRAFT 2008 EPC AGENDA TEXT 
 
2008 ECONOMIC PARTNERSHIP COMMISSION AGENDA 
 
¶I. Welcome and Introduction 
 
II. Macroeconomic Policy and Development (AJ lead) 
 
GOAL: To focus the GOAJ on the need to restrain fiscal 
spending, improve its public investment planning program and 
ensure long-term sustainability of its energy wealth. 
 
--Macroeconomic Overview for 2008:  Inflation, Fiscal Policy, 
Monetary Policy (AJ) 
--Public Expenditure Reform - Update on status and progress 
to put in place a best practices-consistent regulatory reform 
framework in 2008. (AJ) 
--Oil Fund and Investment Strategy - Update on status and 
progress on rationalizing long-term investment strategy and 
ensuring the efficient/transparent use of oil revenues 
invested locally. (AJ) 
--Public Investment planning and budget decree (AJ) 
--Briefing on expenditure reform support efforts (U.S.) 
 
III. WTO (U.S. lead) 
 
GOAL: To solidify GOAJ WTO progress, push for co-financing of 
U.S. WTO assistance and set obtainable dates for meeting 
critical WTO benchmarks. 
 
--USTR update on WTO process; briefing on U.S. WTO assistance 
(U.S.) 
--GOAJ steps taken with U.S. assistance (AJ) 
--IPR (AJ) 
 
IV. Trade and Investment Climate (AJ lead) 
 
GOAL: To improve the overall business climate, highlight the 
negative effects of corruption, push for real investment 
reforms, and create commercial opportunities for U.S. 
businesses. 
 
--Enabling Environment Reform; update on World Bank Doing 
Business reforms - Progress read out (AJ) 
--U.S.-Azerbaijan commercial relationship (U.S.) 
--Briefing on the state investment projects 2008-2010 (AJ) 
--Competitive taxation system (U.S.) 
--Anti-corruption - Status update and further practical 
commitments in key areas, including public procurement 
reform, tax admin reform, and customs reform (AJ) 
--Anti-money laundering and terrorist finance legislation (AJ) 
--Briefing on state procurement process (AJ) 
--Competition code/anti-monopoly law and the foreign 
investment law (AJ) 
 
¶V. Working Lunch 
 
VI. Non-Oil Sector Development and Economic Diversification 
(AJ) 
 
GOAL: To highlight the importance of the non-energy sector in 
Azerbaijan,s long-term sustainable development and stress 
the positives of economic diversification in the IT and 
agricultural sectors. 
 
--Briefing on information technology initiatives (AJ) 
--Briefing on agricultural sector reform assistance (U.S.) 
--Briefing on transportation infrastructure projects (AJ) 
--Bilateral cooperation for energy sector public policy 
initiative (Baker Center) (U.S.) 
--Free Economic Zones (AJ) 
 
VII. Co-Financing and Assistance (U.S. lead) 
 
GOAL: Obtain a concrete plan for GOAJ co-financing of all 
U.S. assistance projects. 
 
--Co-financing progress and follow-on commitments. (U.S.) 
 
VII. Conclusion 
 
VIII. Evening USACC hosted dinner with EPC participants and 
senior executives from U.S. companies. 
 
DAY 2: Organize a businessmen roundtable with key GOAJ 
ministers - Babayev, Sharifov - with the goal of expanding 
U.S. commercial opportunities. 
 
END DRAFT 2008 EPC AGENDA TEXT 
 
¶3. (U) BEGIN DRAFT 2008 EPC DELIVERABLES TEXT 
 
EPC Deliverables 
 
Macroeconomic Policy and Development 
------------------------------------ 
 
--Issue in 2008 a new public investment planning decree which 
strengthens the transparency and rigor characterizing public 
investment planning processes. (AJ) 
 
--Issue in 2008 an strategy to promote development of a 
trained cadre of specialists is developed which can carry out 
cost/benefit analysis. (AJ) 
 
--Adopt in 2008 an international best practices-consistent 
public procurement law. (AJ) 
 
--Adopt in 2008 anti-money laundering/counter terrorist 
financing law. (AJ) 
 
WTO 
--- 
 
--By June 2008 the GOAJ commits to co-finance U.S. WTO 
assistance (AJ) 
 
--In 2008 Azerbaijan will demonstrate significant progress 
towards ensuring that a WTO-consistent legal/regulatory 
framework is put in place. (AJ) 
 
--Issue in 2008 a WTO-consistent customs code and key 
implementing guidelines. (AJ) 
 
Trade and Investment Climate 
---------------------------- 
 
--Adopt in 2008 a new collateral law which significantly 
strengthens creditor rights and improves incentives for using 
moveable property for loan guarantee purposes. (AJ) 
 
--Adopt in 2008 a new competition code which creates an 
international best practices-consistent legal analysis and 
enforcement framework for reducing/eliminating 
anti-competitive practices. (AJ) 
 
--Implement in 2008 streamlined and transparent business 
registration and licensing procedures. (AJ) 
 
--Issue in 2008 regulatory reforms reducing trade 
restrictions and related approval documentation. 
 
--Adopt in 2008 a new credit bureau law. (AJ) 
 
--Adopt in 2008 a new conflict of interest legislation. (AJ) 
 
--By June 2008 finalize Bechtel Trans-Azerbaijan Express 
Motorway project discussions. (AJ) 
 
--By October 2008 re-establish USDOC representative in 
Azerbaijan. (U.S.) 
 
Non-Oil Sector Development and Economic Diversification 
--------------------------------------------- ---------- 
 
--By June 2008 establish an inter-ministerial working group 
on agricultural strategy development and operational plan 
development (AJ); follow-up on USAID/USDA technical 
collaboration efforts launched in support of agricultural 
reform (U.S.). 
 
--Support and assist MES delegation visit to U.S. in March or 
April 2008. (U.S.) 
 
--By June 2008 further DOE Cooperation/Baker Center. (U.S.) 
 
--By September 2008 create bi-national Fulbright Commission 
to facilitate scholarly and student exchanges. (U.S.) 
 
Co-Financing and Assistance 
--------------------------- 
 
--At the EPC the U.S. and Azerbaijan sign a co-financing MOU 
encompassing all USG activities included in our request to 
the GOAJ totaling USD $21.8 million over the next two years 
($8.2 million supporting EG; $13.6 million supporting 
NGO/Civil Society strengthening; and an unspecified amount 
supporting scholarships). (AJ) 
 
END DRAFT 2008 EPC DELIVERABLES TEXT 
DERSE