VZCZCXRO0985
RR RUEHDA
DE RUEHAK #0015/01 0070548
ZNR UUUUU ZZH
R 070548Z JAN 09
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 8385
INFO RUEHRC/USDA FAS WASHDC
RUCPDOC/USDOC WASHDC
RUEHIT/AMCONSUL ISTANBUL 5191
RUEHDA/AMCONSUL ADANA 3494

UNCLAS SECTION 01 OF 03 ANKARA 000015 
 
DEPT PLEASE PASS USTR FOR CWILSON, MMOWREY AND 
RWENZEL 
USDOC FOR ITA/MAC CHERIE RUSNAK 
DEPT FOR EUR/SE AND EEB/TPP/BTA 
FAS FOR MICHAEL SMITH 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ETRD ECON EAGR KIPR TU
SUBJECT: SCENESETTER FOR THE SIXTH U.S.-TURKEY TIFA 
MEETINGS 
 
Ref: 08 Ankara 2191 
 
This information is sensitive but unclassified. 
Please protect accordingly. 
 
¶1. (SBU) Summary:  We should focus our efforts in the 
sixth U.S.-Turkey Trade and Investment Framework 
Agreement (TIFA) discussions on expanding U.S. market 
access in Turkey and building on recent progress in 
reducing barriers to trade and investment, with 
emphasis on market access issues, particularly for 
agricultural products.  IPR protections have improved 
in the past two years despite a recent setback to 
trademark protection.  This year's meetings will be 
set in a markedly gloomier global economic context 
than the TIFA meetings in 2006 and 2007, a context 
which may be used as an excuse for inaction on the 
part of the GOT).  End summary. 
 
¶2. (SBU) The sixth U.S.-Turkey Trade and Investment 
Framework Agreement discussions, scheduled for 
January 13, 2009, in Ankara will be led by Foreign 
Trade (FTU) Deputy Undersecretary Ulker Guzel and 
will have representatives from the Ministries of 
Culture, Justice, Agriculture, Health, and Finance, 
as well as from the Treasury Undersecretariat and the 
Turkish Patent Institute.  The talks will be preceded 
by a private sector event in Istanbul on January 12 
for the U.S. delegation to discuss issues affecting 
the U.S. business community. 
 
Points to Raise 
--------------- 
 
¶3. (SBU) Recommend highlighting: 
 
- Access for agricultural products must be 
streamlined and brought in line with WTO norms (see 
para. 6) 
 
- Momentum on improving IPR should be maintained, 
despite recent setbacks (see paras. 7) 
 
- Improving the process for foreign workers to get 
necessary permits will aid investment in Turkey (see 
para. 8) 
 
Likely Turkish Concerns 
----------------------- 
 
¶4. (SBU) The Turkish side could raise: 
 
- Increasing opportunities for cooperation and 
foreign investment(see para. 9) 
 
- Turkish perception of the negative impact of 
changes in Generalized System of Preferences and 
textile quotas (see para. 10) 
 
- Concern about implementation of the Container 
Security Initiative and Secure Freight Initiative 
(see para. 11) 
 
Financial Crisis and Domestic Political Concerns 
-------------------------------------------- 
 
¶5. (SBU) Reforms following its 2001 financial crisis 
largely shielded  Turkey's financial system from the 
global financial crisis, but the knock-on economic 
effects in the commercial and manufacturing sectors 
are beginning to bite.  Factories are closing, 
exports in 2009 are expected to decline by 20 percent 
(and have already started falling), and unemployment 
is on the rise (officially now at 10.2 percent, 
unofficially much higher).  Growth in 2009 is 
expected to be flat at best.  The GOT is pinning its 
hopes on a planned IMF agreement to calm markets and 
provide needed financing to the private sector, but 
ruling AK Party is positioning itself for local 
elections in March 2009 and the GOT may be tempted to 
take more protectionist actions.  We assess that the 
GOT will be reluctant to undertake major policy 
 
ANKARA 00000015  002 OF 003 
 
 
changes that could be construed as damaging to the 
local producers whose support the AKP is courting. 
 
Agricultural Issues 
------------------- 
 
¶6. (SBU) Despite some limited successes, market 
access remains restricted for U.S. agricultural 
products.  In 2007, Turkey agreed to a protocol 
permitting the import of live breeding cattle.  As a 
result of a WTO dispute resolution case brought by 
the U.S., Turkey has resumed the import of U.S. rice. 
Despite these successes, significant challenges 
remain, including: 
 
--  failure to comply with WTO requirements for 
Sanitary and Phytosanitary Standards(SPS)/Technical 
Barriers to Trade (TBT) notifications; 
 
--  unscientific SPS measures and import 
documentation requirements; 
 
--  inordinately high tariffs; 
 
--  de facto seasonal bans on imports of agricultural 
products during the domestic harvest season for that 
product; and 
 
--  de facto import restrictions on items such as 
beef and poultry. 
 
Intellectual Property Rights 
---------------------------- 
 
¶7. (SBU) Turkey's considerable improvement in IPR 
protection infrastructure and legal framework led in 
2008 to its shift from the Special 301 Priority Watch 
List down to the Watch.  Issues related to 
pharmaceutical data exclusivity, pricing and 
reimbursement continue to be a major concern to U.S. 
pharmaceutical companies.  In addition, a recent 
Turkish Supreme Court decision invalidated thousands 
of pending trademark cases (see reftel).  We should 
request an update from the GOT on their strategy to 
remedy this situation.  Turkey must continue its law 
enforcement efforts to combat the production and 
distribution of counterfeit trademarked goods.  The 
Turkish delegation is preparing an update on the new 
patent law under consideration by Parliament. 
 
Work Permits and Degree Equivalency 
----------------------------------- 
 
¶8. (SBU) A frequent complaint of U.S. investors is 
that it takes too long for skilled foreign workers to 
receive certification that their degrees are 
equivalent to local degrees for the purposes of 
obtaining work permits.  The work permit itself then 
requires an additional complicated process.  This 
discourages investment in Turkey because it is 
difficult for companies to bring in their own talent 
to open up or run operations in Turkey. 
 
Turkish Concerns:  Increased Cooperation 
---------------------------------------- 
 
¶9. (SBU) The GOT is eagerly looking for areas where 
cooperation with the U.S. can lead to increased trade 
and investment.  They will present updates on planned 
programs to promote Turkey in the U.S. and to educate 
Turkish companies about U.S. procedures.  They also 
want to discuss possibilities for cooperation in 
construction (for example, in northern Iraq). 
Finally, they will propose the creation of a U.S. 
Trade Center in Istanbul and explore the possibility 
of beginning a preferential trade agreement with the 
U.S. (Comment: It is unclear how this would work in 
the context of Turkey's EU commitments and our own 
existing trade treaties. End comment.) 
 
GSP 
--- 
 
ANKARA 00000015  003 OF 003 
 
 
 
¶10. (SBU) The Turkish delegation will request an 
update on the current status of the Generalized 
System of Preferences and the prognosis for Turkey's 
participation in the system.  Turkey is concerned 
that the extensions to its participation may be 
discontinued.  They will also raise the issue of the 
recently-expired textile quotas and the likely impact 
on Turkish exporters. 
 
CSI/Secure Freight Initiative 
----------------------------- 
 
¶11. (SBU) The GOT has requested that the U.S. provide 
a status update on the Container Security and Secure 
Freight Initiatives and the likelihood of those 
programs being implemented in Turkey in the near 
future.  Turkey is concerned about the potential 
expense and administrative burden of the CSI/SFU 
requirements for their ports. 
 
JEFFREY