SUBJECT: IT TAKES A TOUGH MAN'S SON TO MAKE A

C O N F I D E N T I A L SECTION 01 OF 02 ASHGABAT 000899

SIPDIS

SIPDIS

DEPT FOR SCA/CEN (PERRY)

E.O. 12958: DECL: 07/07/2016
TAGS: EAGR EINV KCOR PREL PGOV PHUM TX GM
SUBJECT: SUBJECT: IT TAKES A TOUGH MAN'S SON TO MAKE A
TENDER CHICKEN IN TURKMENISTAN

REF: ASHGABAT 884

ASHGABAT 00000899 001.2 OF 002


Classified By: Charge d'Affaires Jennifer L. Brush, for reasons 1.4 (b)
and (d)

Summary
--------------


1. (C) Turkmenistan continues to get curiouser and
curiouser. The embattled but profitable German-Turkmenistan
Joint Venture "Shohrat" chicken farm apparently is being
slowly but surely expropriated, possibly to end up as a model
enterprise for presidential son Murat Niyazov. The Turkmen
partner in the joint venture has been in jail for a month on
charges of illegal use of land and according to the German
investor, "not a single local lawyer" is willing to take
their case. According to local EU Commission Advisor Michael
Wilson, Murat has started to return to Turkmenistan on a
monthly basis, is studying intensive Turkmen language and is
looking for an appropriate position. On the heels of PDAS
Mann's August 14 visit advising President Niyazov to "send a
serious signal that Turkmenistan can be a reliable business
partner," the chicken farm's woes only goes further to prove
Niyazov has no such intention. End Summary.

The Saga of the Shohrat Chicken Farm
-------------- -


2. (C) On August 23 German-Turkish businessman "Mr. Dogan"
invited Chiefs of Mission from the United States, Germany UK,
France and EU Commission to lunch to hear the latest chapter
in the saga of his joint venture the "Shohrat" chicken farm.
According to Dogan, his Turkmen business partner and the
partner's son had been thrown in jail a month ago on charges
of illegal use of land and illegal possession of a service
passport. Dogan said he had arrived in Ashgabat as soon as
he could after hearing this news but had been delayed when
Turkmenistan authorities had denied him a visa based on a
pending court case against Dogan filed by a citizen of
Turkmenistan in a German court. German Ambassador Mondorff
added that after he protested the visa decision via note
verbale, Foreign Minister Meredov had called him in July 31
to explain the government's position. According to Meredov,
the chicken farm never was a joint venture and Dogan was not
a legitimate investor. In addition, Dogan's partner was
guilty of

--illegal occupation of 1500 hectares of land,

-- illegal occupation of premises belonging to the Ministry
of Defense, and

--illegal possession of a service passport.


3. (C) Mondorff said he told Meredov that he was "baffled"
by these charges considering the land had been in use for
over three years in broad view of the public and authorities
right along the major Ashgabat-Mary highway. Dogan added
that in fact the Governor of Ahal Province and the Minister
of Defense had "given" the farm the land because it was
considered overly salinated and therefore non-arable.
Furthermore, Dogan continued, President Niyazov himself had
singled out for praise the Shohrat farm during a Cabinet of
Ministers meeting earlier this year. According to Dogan,
Niyazov was particularly impressed by the farm's cheap and
effective technique to desalinate the land and plant it with
sufficient grain to feed the farm's chickens. Niyazov
apparently criticized then-Agriculture Minister Begench
Atamyradov for not running the state poultry farms at the
same high level.


4. (C) According to Dogan, he came to Turkmenistan soon
after independence, encouraged by Turkmenistani friends who
told him there was money to be made in the poultry business.
Dogan said he found his partner "Shohrat," financed the
purchase of machinery and he has been returning to
Turkmenistan at frequent intervals to oversee the project.
The farm started having problems in 2002 when the government
tried to shut it down, but Dogan says a good local lawyer
sorted out whatever the problem was at that time. Things got
more serious in 2004 when the government came after the farm
again, but Mondorff marshalled the local diplomatic
community, had a high-level EU delegation discuss the case

ASHGABAT 00000899 002.2 OF 002


with the president and hired the same lawyer to work out the
details. Following this standoff, Dogan claims the Ministry
of Defense and provincial government gave him even more land
(now the land his partner is accused of occupying illegally).
Though the land was unarable at the time, Dogan claims to
have perfected a cheap technique to desalinate and now has
had three successful crops of grain, considerably increasing
his profit margin as he no longer has to pay for chicken
feed. There were a number of dilapidated barracks also on
the Ministry of Defense land which Dogan renovated to house
his chick/egg-laying operations. Dogan said he was preparing
one of the barracks to begin a broiler preparation operation
(Note: Since imported chicken was banned earlier this year
because of avian influenza, there have been no broilers
available on the local market. Even the importer bringing in
U.S.-origin quarter-thighs, locally referred to as "Bush's
Legs" no longer is bringing in chicken. Apparently the
frozen quarter thighs still available on the market are the
dregs of the last shipment and should be consumed "at your
own risk." More on the overall chicken shortage septel. End
Note.) Now, according to Dogan, "no lawyer in Turkmenistan"
is willing to take on the case of Dogan's partner, not even
the lawyer who had successfully defended the operation in the
past.

Murat Perdue?
--------------


5. (C) The plot thickened, however, when Dogan said that his
partner had told him prior to his arrest that the local Ahal
Hotel Chain manager Italian citizen Luigi Fontanabona, who
also serves as Niyazov's personal cook and runs Niyazov's
personal chicken farm, had visited Shohrat unannounced and
took physical measurements of the interiors of the chicken
farm facilities.


6. (C) As Dogan continued telling the legal details of his
saga to the other guests, Wilson whispered to Charge. "This
is where Murat comes in." According to Wilson, the Shohrat
farm is "cooked," Wilson is convinced that Niyazov decided to
grab the profitable farm to give his son Murat something to
run. Wilson said Murat now was coming to Turkmenistan from
Vienna on a monthly basis, most often through Moscow (where
his mother and sister reside),and was studying "intensive
Turkmen." (Note: As of 2004 Murat could not speak Turkmen.
End Note.) Wilson also said that Dogan's imprisoned partner
was a schoolmate of Murat's, which explained how Dogan was
able to open his joint venture in the first place. According
to Wilson, Murat was likely to run the chicken farm, once it
was successfully confiscated, and also would be given other
political sinecures.

Comment
--------------


7. (C) This is a wild story, possibly just wild enough to
make sense. In any case, on the heels of PDAS Mann's August
14 suggestion to President Niyazov that he "send a strong
signal that Turkmenistan could be a reliable business
partner," the troubles of the Shohrat chicken farm are
further indication that Turkmenistan could hardly be less
reliable. End Comment.
BRUSH