QIZ FOLLOWUP DEMARCHE DELIVERED TO MFA AND

UNCLAS ANKARA 001324 SIPDIS STATE FOR E, EB AND EUR/SE TREASURY FOR OASIA DEPT PLEASE PASS USTR FOR LERRION FAS FOR ITP/THORBURN USDOC FOR ITA/MAC/DDEFALCO SENSITIVE E.O. 12958: N/A TAGS: ETRD TU SUBJECT: QIZ FOLLOWUP DEMARCHE DELIVERED TO MFA AND FOREIGN TRADE Ref: STATE 49115 ¶1. (SBU) Econoff delivered reftel points urging the GOT to provide a unified and official response to our Qualifying Industrial Zones (QIZ) proposal to Mehmet Gucuk, MFA Deputy Director General for Bilateral Economic Affairs, and to Osman Bekaroglu, Deputy Director General for Agreements at the Foreign Trade Undersecretariat, on March 5. Bekaroglu had no immediate response. Gucuk told us the GOT was close to an interagency consensus on the QIZ and would respond to our nonpaper soon. In response to reftel points on the advantages of retaining a catchall clause in U.S. draft legislation, he said MFA would prefer that the catchall clause be dropped. He argued that USTR could still veto QIZ proposals without an explicit clause in the legislation, and suggested that the USG make this argument when it submits the legislation to Congress. Gucuk thanked Econoff for reftel information and opined that this would be one of the topics to be discussed during the Ziyal/Larson telephone call following up the December Economic Partnership Commission meeting. ¶2. (SBU) Comment: MFA will probably continue to press for elimination of the catchall clause, even at the risk of lengthening the list of sectoral exclusions in the final draft of QIZ legislation. MFA wants to be able to show Turkish industry that it succeeded, or at least tried hard, in chipping away some of the limits in our QIZ proposal. If the end result is a QIZ with more limited sectoral coverage, MFA will lay the blame with protectionist interests in the U.S. Congress, or with the Administration for not pushing hard enough on this issue. Edelman