VZCZCXYZ0003
PP RUEHWEB

DE RUEHAK #0068/01 0151032
ZNR UUUUU ZZH
P 151032Z JAN 09
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC PRIORITY 8470
INFO RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
RUEATRS/TREASURY DEPT WASHDC PRIORITY
RHEHAAA/NSC WASHDC PRIORITY
RUEAIIA/CIA WASHDC PRIORITY

UNCLAS ANKARA 000068 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EFIN ECON OVIP TU
SUBJECT: TURKISH ECONOMIC TEAM EAGER TO MEET WITH NEW U.S. 
COUNTERPARTS 
 
REF: 2008 ANKARA 996 
 
¶1. (SBU)  Summary.  In a January 13 courtesy call, Turkish 
Deputy Prime Minister Nazim Ekren told the Ambassador he 
wants to visit Washington to meet with President-elect 
Obama's top economic leaders as soon as practical.  The 
Ambassador said he would be pleased to support such a visit, 
although he cautioned it would be best to wait until key 
staff are in place.  Ekren advised that negotiations with the 
visiting IMF delegation on a stand-by arrangement (SBA) are 
proceeding well and a deal is likely if terms can be reached. 
 In a separate January 13 meeting, Transportation and 
Communications Minister Binali Yildirim underlined the need 
for flexibility in an IMF deal.  Ekren provided an update on 
the Southeastern Anatolia Project (GAP), noting that Turkey 
is continuing with its $11 billion, five-year investment to 
develop the southeast.  The GOT's plan is to use organic 
farming, renewable energy, and tourism to boost the economy 
and bring Turkey's poorest provinces up to the standard of 
the rest of the country.  End summary 
 
¶2.  (U)  As DPM and State Minister for Economic Affairs, 
Ekren authoritatively said Turkey is now feeling the pinch of 
the economic crisis and is concerned about finding an export 
market for its products and gaining access to foreign 
financing.  Ekren noted that consumer confidence and 
production are down and capacity utilization is at an 18-year 
low.  He said the GOT's Medium Term Fiscal Framework (May 
2008) helped to avert a more severe contraction. 
 
Memo to the IMF:  Be Flexible 
----------------------------- 
 
¶3. (SBU)  The Ambassador told Ekren we support Turkey in its 
plan to arrange a stand-by deal with the IMF, although the 
final decision rests with the GOT.  Ekren told us the GOT has 
already cut $3.8 billion in spending programs from the budget 
and the economic team is working with the IMF to cut out 
extra fat.  Ekren said the IMF could be most helpful with 
external financing, since that is a large and growing problem 
for Turkish companies.  Ekren said an IMF deal will be 
especially timely now with global capital markets changing 
almost daily.  Ekren said a deal will be done if a "flexible 
model" can be negotiated, adding the GOT expects to get 
credit for significant economic gains over the last five to 
six years. 
 
¶4. (SBU)  In a separate meeting, Transportation Minister 
Yildirim described to the Ambassador the need to stimulate 
and rejuvenate the economy and then asked the Ambassador to 
"tell the IMF to treat us the way they treat you."  He and 
the Ambassador discussed USG efforts to give money to banks 
with the goal to pass it on to customers and stimulate the 
economy.  Since the banks generally held the money, the 
strategy was not successful.  Yildirim noted President-elect 
Obama's plan to rejuvenate the economy by having the U.S. 
Government build new roads, bridges, airports, and possibly 
even an advanced information superhighway.  This way, 
Yildirim opined, everyone will win and money will spread 
throughout the economy.  Unemployment will drop, trust will 
increase, and the vicious cycle of economic stagnation will 
end.  Yildirim said the Turkish Government wants to do 
exactly the same thing and sees this method as the best way 
to reinvigorate the economy.  He says the IMF opposes this 
plan, which Turkey sees as necessary for a deal.  He echoed 
Ekren's point that Turkey and the IMF are not starting from 
scratch, and the IMF should credit Turkey for six years of 
good economic management and good relations during the SBA 
that matured in May 2008. 
 
Meeting of Economic Counterparts 
-------------------------------- 
 
¶5. (U)  After President-elect Obama is inaugurated and his 
economic team is in place, DPM Ekren would like to bring a 
group of Turkey's top economic leaders to meet with them in 
Washington.  In particular, he mentioned the Secretaries of 
State, Treasury, Commerce, and the top economic advisors. 
The Ambassador recommended a delay in these meetings until 
the whole team is in place, although he welcomed the idea in 
principle. 
 
¶6. (U)  On the GAP, Turkey plans to spend 4 billion TL ($2.58 
billion) in 2009.  Reftel describes the GOT's five-year plan 
to increase the standard of living and boost economic 
prospects of the poorest nine provinces up to the levels 
enjoyed by the rest of the country.  Ekren thinks Turkey 
could be a good candidate for an organic agriculture center 
 
to supply fruits, vegetables, and animal products to other 
countries in the region.  He said renewable energy projects 
and tourism could also boost the GAP's prospects. 
 
¶7. (U)  Ekren closed the meeting reemphasizing the Prime 
Minister's plan to turn Istanbul into an international 
financial center by relocating the Central Bank, banking 
regulator, and the top state-owned banks to Turkey's biggest 
city.  Ekren and the Ambassador discussed plans for the 
October 2009 Istanbul meetings of the World Bank and IMF, 
which could be a good opportunity for Turkey to show off its 
prospects for making Istanbul a top destination for 
international financiers. 
 
Visit Ankara's Classified Web Site at 
http://www.intelink.sgov.gov/wiki/Portal:Turk ey 
 
Jeffrey