Identifier
Created
Classification
Origin
03ANKARA6482
2003-10-16 15:22:00
CONFIDENTIAL
Embassy Ankara
Cable title:  

IRAQ-TURKEY TRADE: HOW CAN TURKISH MERCHANTS GET

Tags:  PREL MARR MOPS ETRD ETTC TU IZ 
pdf how-to read a cable
This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L ANKARA 006482 

SIPDIS


E.O. 12958: DECL: 10/15/2013
TAGS: PREL MARR MOPS ETRD ETTC TU IZ
SUBJECT: IRAQ-TURKEY TRADE: HOW CAN TURKISH MERCHANTS GET
PROCEEDS HOME FROM IRAQ?

Classified by A/DCM Scot Marciel. Reasons 1.5 B and D.
Action Request at para
C O N F I D E N T I A L ANKARA 006482

SIPDIS


E.O. 12958: DECL: 10/15/2013
TAGS: PREL MARR MOPS ETRD ETTC TU IZ
SUBJECT: IRAQ-TURKEY TRADE: HOW CAN TURKISH MERCHANTS GET
PROCEEDS HOME FROM IRAQ?

Classified by A/DCM Scot Marciel. Reasons 1.5 B and D.
Action Request at para 1.


--------------
SUMMARY AND ACTION REQUEST
--------------



1. (C) CPA regulations prohibiting any cash over USD 10,000
from entering or leaving Iraq, coupled with the absence of a
fully functioning banking system is problematic for merchants
doing large-scale business in Iraq. The Turkish MFA informed
Embassy this week that Turkish merchants are increasingly
complaining about US military personnel preventing them from
moving cash across the border after having sold their wares.
The Turks point out that some of the trade is being conducted
with the US military. ACTION REQUEST: Request Washington
and CPA explore possibilities to either establish an
exemption for bona fide merchants and their trucker agents
from the USD 10,000 limit, or establish a simple and
accessible means of international transfer they could use to
get their money from Iraq to their home countries. If such a
facility that can be used by Turkish merchants and truckers
already exists, please advise soonest. End summary and action
request.



2. (C) MFA Economics Department Head Akif Ayhan contacted
PolMilOff Oct. 15 to say increasing numbers of Turkish
merchants were complaining that US military officials on the
Iraqi side of the Habur border crossing were preventing
Turkish merchants from bringing the cash they had earned in
Iraq back to Turkey. In the absence of a fully functioning
banking system, Ayhan noted, the merchants had no alternative
but to carry cash, as they had been doing for years. He
asked that we look into the complaints and if true, offer a
solution that the GOT could pass on to the Turkish merchants.



3. (C) Comment: We ascertained via contact with the 101st
Airborne that they have been enforcing the CPA regulation
prohibiting any cash over USD 10,000 from entering or leaving
Iraq, and that on Oct. 13, more than USD 300,000 was
confiscated by Iraqi customs police at the border. The cash
had not been declared and was hidden under bags of produce.
The siezure of this money may have generated the recent
complaints Ayhan reported to us. End Comment.



4. (C) Ayhan asked PolMilOff to come see him Oct. 16.
PolMilOff explained the CPA regulation and confirmed that
authorities at the border were enforcing the regulation.
Ayhan said that Turkey understood the practice of limiting
cash movements across international borders for anti-money
laundering purposes, but under the current circumstances,
some solution needed to be found for Turkish merchants and
truckers. Whatever new system gets implemented, he said, it
should be simple. Ayhan then said that the restrictions run
counter to the desire on the US, Turkish and Iraqi sides to
increase trade. The terms of trade across the Iraq-Turkey
border have been on a cash basis for many years. To change
that now could lead to the end of Turkish exports to Iraq, he
warned. Ayhan also pointed out that Turkey has been a main
artery for humanitarian aid to Iraq which could also be
jeopardized. The problem, he underscored, must be solved
immediately.



5. (C) Ayhan noted that Turkey's Ak Bank was already part of
the Iraqi Trade Bank, but he did not think that Turkish
truckers or small merchants would be able to avail themselves
of its use. He suggested that Zirat Bank, which wants to
open branch offices in Iraq, might be able to do so quickly
and provide transfer service from Mosul or Zakho.



6. (C) Ayhan also asked if there was any USG response to
Turkey's request to have a meeting with US and CPA officials
in Ankara to discuss opening a second border gate. He added
that the GOT would also be prepared to include Iraqi MFA and
MOI reps. However, he stressed, such a meeting should not
take place at Habur where local officials were not in a
position to engage on the substance.



7. (U) Baghdad minimize considered.
EDELMAN