VZCZCXRO7741
RR RUEHLN RUEHSK RUEHVK RUEHYG
DE RUEHDBU #1582/01 3660918
ZNR UUUUU ZZH
R 310918Z DEC 08
FM AMEMBASSY DUSHANBE
TO RUEHC/SECSTATE WASHDC 1291
INFO RUCNCIS/CIS COLLECTIVE
RUEHBUL/AMEMBASSY KABUL 0370
RUCPDOC/DEPARTMENT OF COMMERCE WASHINGTON DC 0098

UNCLAS SECTION 01 OF 02 DUSHANBE 001582 
 
SIPDIS 
SENSITIVE 
 
DEPARTMENT FOR SCA/CEN 
 
E.O. 12958: N/A 
TAGS: EAIR ECON ETRD PGOV TI
SUBJECT: OPEN SKIES DEMARCHE AND AVIATION SECTOR DEVELOPMENTS 
 
Reftel: State 129946 
 
¶1. (SBU) Summary: The Minister of Transport viewed our offer to 
explore an Open Skies agreement as a chance to get more aid from the 
United States.  He suggested Tajikistan would move slowly on Open 
Skies, seeking a bilateral agreement before considering a regional 
agreement, and would move slowly on liberalization of the aviations 
sector in general.  The appointment of a new Tajik Air Director did 
not appear to be a move toward greater business efficiency, but 
Tajik Air's breakup into separate private air, navigation, and 
airport companies is still due to take effect on January 1, 2009. 
End Summary. 
 
Stall Warning 
 
 
¶2. (SBU) Emboff delivered reftel demarche to Minister of Transport 
Ashur on December 16.  In response to the points on the benefits of 
an Open Skies agreement, Minister Ashur commented that Tajikistan's 
"usual approach" was to pursue bilateral aviations agreements, so 
they would consider a regional Open Skies agreement later, after 
gaining experience with a bilateral agreement.  Ashur said  the 
Tajik Air restructuring was almost complete, and the airline, 
airports, and navigations services companies would have separate 
balance sheets as of January 1, 2009.  They now had competition in 
the Tajik aviation market, in the form of soon-to-be-privatized 
Tajik Air, and Somon Air.  The Tajik aviation market was open to all 
comers, and Open Skies should not be a problem; Turkish, Iranian, 
Azeri, and other companies were interested in starting flights to 
Tajikistan. 
 
Holding Pattern 
 
¶3. (SBU) In the next breath Ashur said Tajikistan's aviation sector 
operated on a "parity basis," i.e. flights from other countries' 
airlines must be matched by a Tajik Air flight on the same route. 
Thus Turkish Air could not get a third weekly flight to Dushanbe 
because there wasn't enough demand to sell all the seats on the 
existing once-a-week Tajik Air flight to Istanbul, much less on any 
additional Tajik Air flights.  "Aviation rights should be based on 
effectiveness" i.e. sales of Tajik Air seats, the Minister said. 
Tajikistan wasn't yet ready for open competition, as this would have 
to wait for modernization of the Tajik Air fleet and improvements to 
ticket sales systems.  Ashur predicted that by 2011, when Tajikistan 
would celebrate its twentieth anniversary of independence, the 
aviation sector would be in much better shape for competition with 
outsiders.  He did not explain why this date should be linked to 
aviation sector reforms. 
 
¶4. (SBU) Ashur asked if the proposed Open Skies agreement came with 
grant assistance, urging the USG to fund Tupolev-to-Boeing 
conversion training for 10 flight crews of Tajik Air.  Emboff 
replied that Open Skies didn't involve assistance, and that the USG 
was unlikely to subsidize the privatized Tajik Air.  Ashur shrugged 
at this news, and asked for a copy of the United States-Uzbekistan 
Open Skies agreement, to study Uzbekistan's arrangements. 
 
¶5. (SBU) After the meeting Deputy Minister Hamroev told emboff that 
he understood the Open Skies concept, considered it a routine matter 
and a basis for future cooperation with the United States in 
aviation, and would help convince the Minister of the need for a 
bilateral agreement.  Post has yet to receive any further feedback 
from the Ministry, although they informed post on December 30 that 
they might have a response early next year. 
 
¶6. (U) Emboff had discussed Open Skies the previous week with 
Negmatjon Buriev, Presidential Economics Adviser.  Buriev's only 
QNegmatjon Buriev, Presidential Economics Adviser.  Buriev's only 
comment on the Open Skies matter was that it should be made part of 
the TIFA process, so that it could progress on a regional basis. 
Post also presented the matter to the new Director of Tajik Air, 
Alimurod Mahmadaliev.  Mahmadaliev, who became Director of Tajik Air 
in November, professed not to know what an Open Skies agreement was, 
but said his staff would study the issue.  Tajik Air later contacted 
Embassy and reported they had no objection to an Open Skies 
agreement. 
 
Flying Without a License? 
 
¶7. (SBU) Mahmadaliev was previously deputy head of the national 
anti-corruption agency, and is from the President's home village of 
Dangara.  He has a degree in Agricultural Economics, and said he 
expected to continue as Director of Tajik Air after the 
privatization of the company in January.  The previous Director was 
Hakimsho Tilloev, whose background was in tax inspection; he was 
previously the First Deputy Minister for State Revenues and Duties. 
The President's chief economic adviser, Matlubkhon Davlatov, 
described Tilloev's firing as a pro-economic reform move since, he 
said, Tilloev opposed Tajik Air's privatization. 
 
DUSHANBE 00001582  002 OF 002 
 
 
 
¶8. (SBU) As for Tajik Air's plans, while still Director of Tajik 
Air, Tilloev had told emboff that Tajik Air planned to lease its 
Tupolev-154s to Iran, and to operate only Boeing aircraft.  Tajik 
air acquired a leased Boeing 757 in early November, saying it would 
use the plane for flights to Frankfurt starting in late-November. 
So far, this flight has not begun operating; it reportedly is 
delayed by administrative difficulties stemming from the breakup of 
Tajik Air, and won't start flying until sometime in the spring. 
Tajik Air now operates several leased Boeing 737s and 757s on 
flights around the region, and according to internet aviation 
databases also operates one of its old 737-200s for Iraqi Airways. 
 
¶9. (SBU) Meanwhile the competition, in the form of Somon Air, is 
slowly increasing its capacity to operate.  It still has a 
wet-leased 737, but now also operates one fully-owned 737, and 
expects another new 737 to arrive in February.  The second purchased 
737 has been delayed by management missteps; Somon acquired a new 
airplane with the wrong engine control software to operate in 
Tajikistan's conditions, and the wrong cabin layout.  Installing new 
seats and a kitchen in the plane, along with adjusting the engine 
controls, will require weeks of work in Turkey, and hundreds of 
thousands of dollars.  Somon Air bought the planes without training 
and maintenance packages to save money, and later sought embassy 
assistance to find such services. 
 
Ostriches 
 
¶10. (SBU) Comment: While Tilloev's removal may have been intended to 
speed  aviation liberalization, the appointment of his successor 
does not appear to be a decisive strike against cronyism and state 
interference.  It was encouraging, and a little surprising, to post 
when Tajik Air stated its support for an Open Skies agreement.  But 
we expect that the Minister of Transport'spreference for 
protectionism in aviation will prevail.  The private competition, 
Somon Air, probably is controlled by the President's family, and its 
delays and missteps show how little capacity it has to operate an 
airline.  End comment.