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UNCLAS SECTION 01 OF 02 ASHGABAT 000228 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/CEN, EEB 
PLEASE PASS TO USTR 
 
E.O. 12958: N/A 
TAGS: PGOV PREL ECON ETRD TX
SUBJECT:  TURKMENISTAN:  WHY ASHGABAT SHOULD HOST THE 2008 
CENTRAL ASIAN TIFA MEETING 
 
REF: A. STATE 1132 
     ¶B. ASHGABAT 0125 
     ¶C. DUSHANBE 0185 
     ¶D. ASHGABAT 0219 
 
¶1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
¶2.  (SBU) In response to Ref A. request asking embassies in 
Central Asia to poll host governments about where to hold the 
2008 Trade and Investment Framework Agreement (TIFA) Council 
meeting, Turkmenistan and Tajikistan both expressed an 
interest in serving as hosts (Refs B and C).  While the 
United States would like for Central Asian TIFA partners to 
work out the hosting issue among themselves, Post has seen 
little effort to date by authorities from either Turkmenistan 
or Tajikistan to translate their "firm offers" to host into a 
campaign for support from other partner governments.  In 
fact, governments in the region are still very unused to abnd 
uncomfortable with this kind of collective bargaining.  And 
so we present the following case for holding the 2008 Central 
Asian TIFA meeting in Ashgabat. 
 
¶3.  (SBU) As an emerging regional player, Turkmenistan is 
already providing natural gas-generated electricity to 
Afghanistan, Tajikistan and Uzbekistan.  It is upgrading the 
road running from Uzbekistan to Afghanistan and its main 
east-west highway, and will have two U.S.-built 
state-of-the-art border crossing checkpoints to facilitate 
cross-border trade in the region.  It is in the process of 
upgrading its airports in Ashgabat and the Caspian port city 
of Turkmenbashy, and has concrete plans to upgrade its harbor 
facilities -- all in the expectation of improving its status 
as a trading partner and transit state in the region.  What 
it lacks, however, is a larger understanding of how to 
translate its interest in promoting trade and investment into 
concrete steps to spur foreign investment, to open market 
access, and to increase private-sector economic activity -- 
all hallmarks of a genuine market economy. 
 
THE GOALS:  SPURRING INTERNAL REFORM 
 
¶4.  (SBU) President Berdimuhamedov has clearly stated both 
publicly and privately, to U.S. and other western officials, 
that he intends to lead his country on a path of reform that 
will allow it gradually to meet international standards and 
become a more attractive target for foreign investment.  To 
that end, Berdimuhamedov has introduced a broad-based program 
of reforms (Ref D), but he has a long way to go to reach his 
goal.  He has not found it easy to motivate Turkmenistan's 
officials, many of whom fear initiative and lack the 
expertise needed to do their jobs.  He has faced particular 
problems in getting top officials in the financial and 
economic sectors to act. 
 
PROMOTING OUTREACH 
 
¶5.  (SBU) For years, Turkmenistan was inward-looking as a 
result of former President Niyazov's neutrality (read 
isolation) policy and his poor relationships with most of his 
regional counterparts.  However, Berdimuhamedov has 
kick-started Turkmenistan's regional recondiliation and 
international reintegration.  He has established joint trade 
and economic investment commissions with all of his neighbors 
and is using those commissions to resolve the issues that 
contributed to Turkmenistan's political and commercial 
isolation under Niyazov and promote new bilateral trade 
relations. 
 
INCREASING PARTICIPATION IN REGIONAL PROGRAMS 
 
¶6.  (SBU) Turkmenistan has begun to join or has increased its 
participation in a number of regional cooperative 
organizations.  Although the Central Asian TIFA was one of 
the handful of regional mechanisms in which Turkmenistan did 
participate under President Niyazov, that participation was 
 
ASHGABAT 00000228  002 OF 002 
 
 
largely passive.  Turkmenistan's expression of interest in 
holding the next TIFA meeting in Ashgabat is a significant 
commitment to greater activism as a regional trade and 
development partner. 
 
¶7.  (SBU) Turkmenistan wants to increase its participation in 
TIFA because it is precisely the sort of organization with 
which Berdimuhamedov feels most comfortable:  a politically 
"neutral" organization whose multilateral focus on promoting 
regional trade and investment is unthreatening and very much 
in Turkmenistan's interest.  From Berdimuhamedov's 
perspective, hosting the TIFA would: 
 
-- Bulwark his internal reform efforts to date, while 
highlighting for still-skeptical financial and economic 
officials how far Turkmenistan is from achieving 
international standards. 
 
-- Offer Berdimuhamedov a high-profile opportunity to 
highlight to his neighbors his commitment to improved 
relations. 
 
-- Give Turkmenistan's economic and financial officials a 
chance to network with their counterparts in neighboring 
countries and greater exposure to international trade regimes 
and practices. 
 
-- Serve as a tangible sign of the international community's 
support for what the president is trying to accomplish. 
 
¶8.  (SBU) The United States has always viewed TIFA as an 
engine for promoting exactly the sorts of change that 
Berdimuhamedov says he wants.  We believe Berdimuhamedov is 
sincerely interested in transforming Turkmenistan, but he is 
hitting serious obstacles.  He has yet to get total buy-in 
from his trade, financial, and economic officials that change 
is needed and positive.  For these reasons, we believe that 
Turkmenistan as host of the next Central Asia TIFA, which 
focuses on a collective approach to promoting trade while 
addressing issues that have become trade barriers, offers a 
soft-sell approach that could help accomplish both 
Berdimuhamedov's goals and, most importantly, our own. 
HOAGLAND