VZCZCXRO1160
RR RUEHAG RUEHAST RUEHBI RUEHCI RUEHDF RUEHIK RUEHLH RUEHLN RUEHLZ
RUEHPW RUEHROV RUEHVK RUEHYG
DE RUEHAH #1004 2141045
ZNR UUUUU ZZH
R 011045Z AUG 08
FM AMEMBASSY ASHGABAT
TO RUEHC/SECSTATE WASHDC 1276
INFO RUCNCIS/CIS COLLECTIVE
RUCNMEM/EU MEMBER STATES COLLECTIVE
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1920
RUEHKO/AMEMBASSY TOKYO 1785
RUEHAK/AMEMBASSY ANKARA 4105
RUEHIT/AMCONSUL ISTANBUL 2354
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEAIIA/CIA WASHDC
RHEFDIA/DIA WASHDC
RHEHNSC/NSC WASHDC
RUEKJCS/JOINT STAFF WASHDC
RUEKJCS/SECDEF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL

UNCLAS ASHGABAT 001004 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR SCA/CEN, EUR/ACE, EEB 
AID/W FOR EE/EA 
 
E.O. 12958: N/A 
TAGS: PGOV PREL EAID TX
SUBJECT:  TURKMENISTAN SIGNALS INTEREST IN DEVELOPING MANAGEMENT 
CAPACITY IN TEXTILE INDUSTRY 
 
¶1.  (SBU) Sensitive but Unclassified.  Not for public internet. 
 
¶2. (U) SUMMARY: In response to a meeting request by the Ministry of 
Textile Industry of Turkmenistan, USAID's Project Development 
Officer Andrew Maybrook, USAID Project Specialist Serdar Yagmurov, 
and Bearing Point Deputy Chief of Party Alex Seleznyov met with 
Minister Jemal Geoklenova on July 18, 2008. The Minister shared her 
goal of building the textile industry's managerial capacity and 
expressed interest in international assistance.  END SUMMARY 
 
¶3.  (U) Established in 1995, the Textile Ministry is currently one 
of the most progressive branches of Turkmen economy.  Ms. Geoklenova 
noted that several factories have semiprivate, joint and/or foreign 
equity ownership. The EBRD is collaborating with the Ministry as an 
investor in a "Jeans Complex" and provides technical assistance 
through training seminars, conferences and visiting technical 
specialists.  The industry has over 30,000 employees in 65 separate 
companies and 25 industrial complexes which process over 40% of all 
cotton produced in Turkmenistan.  Approximately 95% of finished 
goods are exported to Europe and the United States and sold through 
such companies as Wal-Mart, Tommy Hilfiger and Hanes.  Ms. 
Geoklenova claimed that most factories operate with relatively 
modern equipment and are ISO 9001, 14001 and Six-Sigma certified. 
She also noted the important social role that the textile industry 
plays in Turkmenistan: According to their calculations, every $1 
billion invested in the oil & gas sector produces approximately 
2,000 jobs, while $1 billion invested in the textile sector produces 
approximately 20,000 jobs.  Overall, the Ministry estimates average 
growth of 20% per annum in the industry, largely due to new 
investments. 
 
¶4. (SBU) Ms. Geoklenova acknowledged that the textile industry faces 
limitations to further growth.  Factories find it difficult to train 
a new workforce fast enough to keep pace with growth, and the 
industry faces a particular need to develop the capacity of middle 
and upper-level management in such areas as marketing, finance 
supervisory skills, and strategy implementation.  Noting the 
limitations of stat-owned enterprises, she said "All over the world 
textile industries are private."  She also said there is a need for 
greater liberalization of production -- citing that private small- 
and medium-sized enterprises are confined to such areas as silk 
farming, transportation services and factory cafeteria services. 
 
¶5.  (SBU) In response to such needs, the Ministry has been sending 
managers abroad for training, namely to China, Korea and 
Switzerland.  The Ministry plans to improve their technical training 
center and build an additional management training institute.  When 
asked how other donors could ideally assist, Ms. Geoklenova 
responded that the Ministry would welcome ways to build worker 
capacity, particularly middle and upper management through, for 
example, inviting technical specialists to consult at factories, 
holding business forums, and providing grants for Turkmen managers 
to train overseas.  (COMMENT: Geoklenova did not mention the need to 
address institutional factors that affect industry performance 
beyond management capacity -- such as improve industry transparency, 
refine strategy and address corruption. END COMMENT.)  She dismissed 
the need to improve strategy, in particular, noting that there is a 
greater need for managers to properly implement existing strategy, 
and she claims that morale at the Ministry and at factories has been 
excellent. 
 
¶6. (SBU) COMMENT:  It is a promising sign that Ms. Geoklenova has 
been taking the initiative to reach out to the international 
community.  In response, international donors might consider 
coordinating efforts to encourage further privatization and market 
liberalization, help the Ministry serve as an example to more 
conservative elements of the Turkmen Government as well as stress 
the benefits for conforming to international trade and labor 
standards.  END COMMENT. 
 
CURRAN