SCENESETTER FOR SACEUR GENERAL JONES'S JANUARY 24

S E C R E T SECTION 01 OF 06 ANKARA 000548

SIPDIS


SACEUR AND EUCOM FOR GENERAL JONES AND POLAD


E.O. 12958: DECL: 08/04/2012
TAGS: PREL MARR TU
SUBJECT: SCENESETTER FOR SACEUR GENERAL JONES'S JANUARY 24
VISIT TO ANKARA

(U) Classified by Deputy Chief of Mission Robert Deutsch.
Reasons: 1.5 (B and D)


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Summary
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1. (S) Your visit comes at a critical time in preparing for
potential Iraqi operations. Site surveys began on 14 Jan 03.
EUCOM/TGS military-to-military consultations reconvened on 3
and 13 Jan 03 respectively and should be completed 23 January

03. Based on a 14 Jan 03 TGS request, two small
CENTCOM/EUCOM planning teams arrived in Ankara last week and
again this week to begin preplanning with TGS for land force
operations with two US brigades. TGS provided very positive
support for both of these planning sessions, and TGS provided
the first substantive indication of its plans for land forces
guarding their border with northern Iraq. TGS and MFA are
working to speed site preparation tasks by finding a way to
approve these tasks without Parliamentary vote. Asked about
possible Turkish support for a US-led Iraq operation, most
Turks oppose. Our political contacts tell us they think that
the GOT senses it must support us as a strategic partner but
will move slowly and to a more limited extent than we wish.
Most Turkish observers feel Turkey will have to support its
strategic partner, but fear war will have heavy economic
consequences for Turkey and would split up Iraq or at least
lead to instability. For this reason, the GOT expects strong
support from the US in encouraging NATO to start planning for
Turkey,s defense and in Article IV and V discussions, should
the situation warrant. Your discussion with the CHOD can
express appreciation for recent positive indicators as well
as reinforce the need to make timely government decisions for
Turkish commitment to support US military operations, if
required.



2. (S) The Turkish political landscape has changed
significantly as a result of national elections, but in ways
that likely do not portend serious change in Turkey,s
commitment to our bilateral relationship. Financial Markets
and public opinion have treated the sweeping AKP victory on 3
Nov 02 with guarded optimism, seeing it as an opportunity to
overcome years of weak coalitions, entrenched party
interests, and economic mismanagement. However, the
government,s lack of coherent and market-friendly
decision-making has begun to erode this optimism. In terms
of foreign policy, Turkey remains committed to broad
strategic partnership with the US and other NATO allies, and
remains a strong supporter in the Global War on Terror.
Turkey is completing its well executed ISAF command, and is
in multilateral talks to complete final agreements on
leadership transition for ISAF III (combined German-Dutch
effort). The 12 Dec 02 European Union summit decision to
offer Turkey an end-2004 contingent date to begin accession
negotiations was greeted with a mix of disappointment and
resignation. Likewise, the certain EU accession offer to
Cyprus causes great concern in Turkey, which sees itself as
the guarantor of the Turkish-speaking population on Cyprus.
We are continuing our effort to produce agreement in a fair
settlement, but TGS reportedly has some security concerns.



3. (S) There have been positive developments on the economic
front, especially in reducing the inflation rate and
beginning to stimulate growth, but the economy remains weak
and Turkey's huge debt burden is a source of great
vulnerability. We are trying to reinforce with all our
senior counterparts the need for Turkey to stick to its
economic reform path. The combined economic weakness and
potential military operations in Iraq have produced an
expectation that the US will guarantee the survival of the
Turkish economy and work to meet Turkey's perceived military
modernization needs by providing a large assistance package.
Your visit provides the opportunity to underline the breadth
of our relationship, at the same time focusing on ways to
resolve mutual concerns on several major operational
challenges. End summary.


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Political Overview - The Domestic Scene
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4. (C) Ruling AK Party has been able to pass constitutional
and legal changes to strengthen democracy and restore AK
leader Erdogan's political rights (stripped by the courts in
1999 for his alleged criminal incitement of racial/religious
enmity -- a move widely understood as a political effort to
keep Erdogan on the sidelines) and allow him to become prime
minister this spring. With a Parliamentary majority of 363
of 550 seats, AK is determined to press for fundamental and
much-needed changes in the way political and economic life is
conducted and ordered in Turkey. Under the formal leadership
of PM Abdullah Gul, both a democratic reformer and devout
Muslim, the AK Government has made Turkey's EU membership bid
and economic reform its top priorities. The new GOT is also
insisting on democratizing changes designed to accord
official respect to more conservative and other heretofore
"undesirable" elements (i.e., the religiously pious) long
relegated to the political, social, and economic sidelines.


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Political Overview -- The Regional Scene
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5. (S) Several pillars of Turkish regional policy in recent
years--close strategic ties to Israel, working relationships
with the KDP and PUK in northern Iraq, and resistance to a
breakthrough on Cyprus negotiations, have come under stress
in the last twelve months. Continuing bloodshed in Israel and
the Palestinian Authority has frayed the edges of the
Israeli-Turkish strategic partnership somewhat, without
forcing a fundamental shift of policy. Concern over
increasing autonomy and institutionalization of Iraq's
northern Kurdish forces led to very sharp exchanges between
KDP leader Barzani and Turkish officials, and GOT relations
with the KDP were tense, although Barzani's 3 Jan 03 visit
here re-established cooperative tone to the relationship.
Turkish relations with the PUK are relatively good. Anxiety
over the prospective acceptance of Cyprus into the EU--with
or without a settlement with Turkish Cypriots--had led to
talk (now dropped) of Turkey's annexing northern Cyprus, a
move which would create a serious divide not just with Greece
and the Greek-controlled Cypriot government, but with the EU
itself. The new UNSYG proposal for Cyprus, submitted to both
sides on 11 Nov 02, calls for two states with one
international identity; this has generated significant
interest. We are continuing to work to produce a settlement,
and many Turks tells us we have never been closer.
Continuing conflict in northern Georgia is another source of
regional concern, with both US and Russian military
activities in or near Georgia dramatically increasing in the
past year. Relationships with Iran, though generally less
tense than during the 1990,s due in large part to the
decline of the PKK, remain cool; Turkish leaders are wary of
Iranian attempts to undermine secular rule.


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Iraq
--------------



6. (S) Site survey modus operandi was signed on 10 Jan 03,
site survey teams started site survey operations on 13 and 14
Jan 03, respectively and are expected to complete their work
by the time of your arrival in Ankara. Results will be
summarized and briefed to the TGS early next week. Recent
EUCOM/CENTCOM meetings with TGS to conduct mil-to-mil
planning consultations for Iraq operations took place on
January 3 and 13, respectively. Based on a 14 Jan 03 TGS
request, two small CENTCOM/EUCOM planning teams arrived in
Ankara last week and again this week to begin preplanning
with TGS for land force operations with two US brigades.
Given we recently begun site survey operations, progress
continues to be made on many operational issues, with the
significant exception of land forces operations. However, as
a result of continuous political and military consultations,
the TGS J3 told us on 14 Jan 03 that the CHOD Gen Ozkok had
been authorized by Prime Minister Gul to have the TGS J3
receive a small (3-6 person) US planning team to come to
Ankara to do preplanning of land operations with two US
brigades. TGS J3 emphasized that this must be an integrated
operational planning effort by US land, US SOF, and Turkish
land forces (Turkish forces deployed to prevent mass
migration) that would operate in Northern Iraq. This
planning session was followed by two more days of intense
planning with joint CENTCOM/EUCOM planners. TGS provided
very positive support for both of these planning sessions,
and TGS provided the first substantive indications for land
forces plans for guarding Turkey's border with northern Iraq.
Additionally, we received strong reporting on 14 Jan 03 that
the TGS and MFA are working on a way to expedite site
preparations that would not/not require Parliamentary
approval.



7. (S) With respect to requests for coalition operations,
there has been no change in TGS/GOT position that only US
forces will be allowed in Turkey. In particular, TGS
leadership reiterated during 14 Jan 03 mil-to-mil that UK
forces (including air and SOF forces) would not be allowed in
Turkey. Question was asked about UK over flight (thinking in
terms of air support originating outside of Turkey) and
received the same negative reply. UK MOD and permanent MOD
Under-Secretary visit with TGS last week reportedly did not
go well. Although UK MOD reportedly is in the process of
formally requesting to begin bilateral UK/TU mil-to-mil
consultations, our sense is that this request will not be
approved anytime soon. The UK CHOD visits the TGS CHOD
again on January 23 to seek support for UK forces in Turkey.



8. (S) Gen Ozkok leaned hard on compensation during his
Washington meetings in November 2002. He saw this as the key
to selling full cooperation to the politicians, who will need
to convince the people that cooperation will not harm
Turkey's interests as much as non-cooperation. There have
been several high level US/TU economic meetings to discuss
size and structure of economic assistance, stressing that the
purpose of any US assistance would be to get Turkey over an
economic shock caused by any operation. With full Turkish
support, that shock will hopefully be brief and take us into
a situation with much brighter prospects for Turkey,
including reconstruction contracts and increased trade with a
friendlier administration in Baghdad, increased long-term
tourism, and the prospect of lower oil costs. The Turkish
government continues to negotiate for the largest possible
economic support package available. You are likely to hear
again from the CHOD on this issue.



9. (S) The MFA has outlined a key dilemma for the Turkish
decision-makers. On the one hand, they agree with us that
the best chance for avoiding war is to demonstrate coalition
preparedness to disarm Saddam forcibly if he does not do it
on his own. That argues for allowing US (and possibly other
coalition) forces into Turkey to send a strong signal to the
Baghdad regime. On the other hand, if this approach succeeds
and Saddam's change of heart constitutes a change of regime
and he is allowed to stay in power, Turkey foresees a
possible sharp downturn in relations with Iraq as well as
much of the Arab world.



10. (S) Nevertheless, at the end of the day, most Turks,
official and ordinary, realize that Turkey really has no
choice. Turkey will have to cooperate to some extent with
the Americans) with or without another UNSCR. The
alternative would not only put them on the other side of the
fence from their key strategic partner, but they would also
be surrendering US economic protection and protection of
their red lines (no Kurdish state, no Kurdish funny business
(seizing Kirkuk and Mosul),no refugees, no subjugation of
the Turkmen, and no ability of the PKK to take advantage of
the war) to foreigners. Turkey wants to work with the US to
shape Iraq and the Middle East, and they realize that if you
don,t play the game, you don't make the rules. In the end,
the GOT will have to use this "nationalist" argument to gain
parliamentary approval for full support. The PM assured Amb
Pearson that he and the AK Party leadership were not the
problem. The PM told the Ambassador that he needed at least
two more weeks to prove to his constituency that he had done
all he could to stop the possibility of war. Once he could
show that war was inevitable, he would be able to deliver
support for the US. He claimed that on his recent Middle
East trip he told his Arab interlocutors "if there is war, we
should all join the coalition." The PM said he was "shocked"
to read reports of US frustration and anger with Turkey, and
explained that he needed time to persuade the Turkish
Parliament to support the US requests.


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NATO
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11. (C) To address some of risks associated with Turkish
cooperation in a potential Iraq operation, the GOT has
requested US support at NATO in initiating Article IV
discussions. Advised that other Allies might not be prepared
for those discussions, the Turks have been satisfied with our
efforts to task the military authorities to a package of
measures that may be necessary should Turkey be attacked.
However, France, Germany, Belgium & Lux made clear at the
January 21 permrep lunch that we would not get Alliance
consensus this week to support the US proposal to task NATO
Military Authorities to begin contingency planning for a role
in an Iraq contingency. Given the bad taste left after
Turkey,s unsuccessful attempts in 1991 to invoke Article V,
unless we can dislodge those Allies soon, the Turks are
likely to get impatient with our efforts and demand Article
IV discussions. Furthermore, those who doubt the Euros would
come to Turkey,s defense in a pinch would be bolstered.



12. (C) The Turks will also likely raise with you NATO
Command Structure Reform. They believe that, as the front
line of NATO,s most volatile flank, a strong NATO presence
in Turkey is necessary, including maintaining the Joint
Sub-Regional Command in Izmir, the CAOC in Eskisehir, and the
new High Readiness Force HQ in Istanbul. The Turks are
hosting ASD Crouch at commands January 25-26 in an effort to
highlight their utility to NATO.



13. (C) The GOT is relieved to overcome the participation
issues that have stalled progress on Berlin Plus but fully
support the US position that all Berlin Plus arrangements
must be in place before permitting the EU to take over PKO
operations in Macedonia. We can expect full support from
Turkey on ESDP issues in Brussels.


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Economic Overview
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14. (C) Although 18 months of economic reform have laid much
of the foundation for greater financial stability and growth,
Turkey's enormous debt burden and structural weaknesses mean
the economy remains extremely vulnerable. The incoming
government has an opportunity to move Turkey away from the
financial precipice on which it has been perched for the past
two years, but to do so it must move quickly to bolster
market confidence, support the battle against inflation, and
implement further reforms needed to generate growth.



15. (C) Financial markets' initial reaction to the AK
election victory has been extremely positive, with interest
rates on treasury bills falling from 65 to 53 percent and the
stock market picking up huge gains. This reaction was based
on the market hope that (a) a one-party government will be
able to move much more aggressively to implement reforms, and
(b) AK means it when it says it will continue to work with
the IMF to implement sound economic policies. This initial
positive view has been fading, and the markets, IMF and we
are seeking renewed implementation of reforms because there
are signals AK is reverting to the old way of doing business.



16. (C) Turkey believes that we cannot divorce the security
cooperation program from broader concepts of economic
support/strategic alliance. The Turkish view is that
modernization and related programs are not just business, but
are critical investments in the common strategic interest.
Turkish expectations about US economic support remain high.
In addition to continued financing, many Turks expect the US
to open its textile markets, direct more US investment to
Turkey, and promote American tourism to Turkey. Through the
Economic Partnership Commission, we have offered Qualifying
Industrial Zones (still needs congressional approval),and
have been pressing hard for improvements in the investment
environment. We also continue to stress our strong support
for the Baku-Tbilisi-Ceyhan and Shah Deniz pipelines, key
elements of the US-Turkish effort to promote an East-West
energy corridor through Turkey. Turks worry that a US
operation in Iraq would hurt their already-weak economy,
particularly if it affects the summer tourism season, and
will expect significant US economic support/compensation.



17. (C) The consistent message that the U.S., EU, IMF, and
World Bank are giving the AK government is: further economic
assistance depends on your complete implementation of the
economic reform program. The Turks face billions of dollars
of debt service payments each month, and raising new debt to
pay off this debt service depends completely on market
confidence. Markets want to see the reforms continue. Thus,
if AK doesn't follow through with reforms, no amount of aid
from us, IMF, World Bank or EU will help the Turks escape the
specter of a debt "event." The Turks received a recent scare
with weak market demand for their 7 Jan 03 debt auctions, but
market demand for Turkish bonds has rebounded since and the
GOT borrowed $3.5 billion from the domestic debt market on 21
January. We should keep reminding the Turks of the need to
fully implement economic reforms as the only way out of the
debt trap.


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FMF Debt Relief
--------------



18. (C) FMF debt relief (and re-initiating of an annual FMF
program) remains a top TGS priority and TGS officials may
raise the issue within the context of ways in which the USG
can assist Turkey.


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Security Assistance/Direct Commercial Sales
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19. (C) Overview: The continued flux in the economic
situation has severely affected the long-range acquisition of
many of the major defense procurement priorities. Although
there has been recent success regarding the AEW&C aircraft,
the result on many programs is that timelines have been
extended and decisions forestalled due to the negative
political impact major arms acquisitions may present. Among
the most important programs still in the balance is the ATAK
helicopter sale. On the positive side, TGS CHOD Ozkok
recently told visiting CJCS Myers that US-Turkey defense
industrial cooperation was important, and that TGS would
begin to concentrate on the ATAK and tank upgrade programs
after the conclusion of the "big three" visits (i.e. CJCS, UK
CHOD Boyce and your visit).



20. (C) Boeing and AEW&C: On 4 Jun 02, Boeing and Turkey
signed a USD 1 billion contract to provide Turkey four 737
Airborne Early Warning and Control aircraft. Boeing worked
hard with SSM, the Government of Turkey's acquisition agency,
to meet all contract provisos to achieve a 4 Dec 02 contract
effectivity date; however, the lack of approval of certain
contract provisos caused delay. TGS, the Undersecretariat of
Defense Industries (SSM) and the TUAF are concerned about
recent provisos that were placed on Boeing's export licenses.
DSCA chief, Lt Gen Walters, got an earful from TAFC, TGS and
SSM during his Nov 02 visit here and promised to get back to
the Turks on how quickly the USG could decide on the
provisos. Washington agencies and Boeing company reps met in
Washington last week to discuss the provisos, and SAF/IA and
Boeing reps will be in Ankara January 27 to brief the Turks
on the results of the meeting. SAF/IA Deputy U/S for
International Operations Willard Mitchell is in Ankara
January 21-24 and will outline in general terms the
state-of-play on the provisos with TGS and TUAF officials.
Meanwhile, Boeing and SSM have extended the 4 Dec effectivity
date to 4 Feb 03. US Electronic Systems Center, provided SSM
a letter of offer and acceptance 9 Aug 02 for the $27 million
dollar government furnished equipment FMS case supporting
Boeing's contract. ESC and SSM worked all LOA points until
10 Oct 02. SSM completed evaluation of the LOA and signed on
11 Nov 02.



21. (U) ATAK Helicopter: The ATAK Helicopter Modernization
Program is currently TGS, #1 security assistance priority.
In Oct 02 TGS expressed significant disenchantment with Bell
Textron's pricing submissions. The pricing effort is
considered high risk from Bell,s perspective due to
technology transfer, integration risk, Turkish work share,
and local content (terms and conditions). SSM has requested
a new revised price submission and has also started active
price negotiations with a Kamov (Russia)/IAI (Israeli)
consortium. During the week of 18-22 Nov 02, Lt Gen Walters
from DSCA, Navy IPO, and Bell Helicopter presented TGS with
two FMS and two DCS options for consideration. TGS, MND, and
SSM continue to analyze these proposals. TGS J5 indicated in
a 30 Dec 02 meeting that operational issues have precluded
presentation of these proposals to TGS leadership.



22. (C) EX-IM Bank Helicopter Guarantee: Senior MFA and TGS
officials have been disappointed with Congress' decision not
to support an extension of the EX-IM loan program to enable
the Turkish Navy to purchase additional Sikorsky helicopters.
Extending the program is one of TGS's highest priorities
(after FMF debt forgiveness and reinstatement of FMF
financing) and the Turks are still looking to the USG to
deliver on its pledge to support an extension of the program
as voiced at the High-Level Defense Group (HLDG) meeting in
Istanbul (Apr 02). On the good news front, the EX-IM board
recently voted to extend the loan program, and we understand
Washington is looking into what additional steps are required
to make this funding available to the Turkish Navy.



23. (C) JSF: Turkey and SSM signed an MOU on the JSF
program in Washington 11 Jul 02. The identification and
accompanying official announcement of Turkey's JSF National
Deputy to the JSF Program Office in the US will continue to
facilitate Turkish participation in JSF program. If the
subject comes up in the your meetings with TGS officials, we
recommend that you congratulate Turkey on its decision to
become a level-three partner and reiterate our commitment to
working closely with Turkey over the years to develop this
new stage of our strategic partnership.



24. (C) UAV: Unmanned Aerial Vehicle. SSM has received the
responses to the initial request for proposal from both
General Atomics Aviation Systems Incorporated (GA ASI) and
Israeli Aviation Industries (IAI). These proposals are
currently under evaluation and down-selection was initially
expected to occur by the end of Nov 03. The actual selection
process will not occur until early in 03. Export licensing
and technology transfer for local content and work share
opportunities are key variables in their selection process.
PEARSON