Identifier
Created
Classification
Origin
07ANKARA220
2007-02-02 06:16:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Ankara
Cable title:  

TURKISH BUSINESS ECOURAGED ON GAZA PROJECT

Tags:  ETRD EAID PREL TU 
pdf how-to read a cable
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Dianne Wampler 02/02/2007 07:42:05 PM From DB/Inbox: Dianne Wampler

Cable 
Text: 
 
 
UNCLAS SENSITIVE ANKARA 00220

SIPDIS
CX:
 ACTION: ECON
 INFO: PA RAO FAS MGT PMA FCS POL DCM AMB CONS

DISSEMINATION: ECON /1
CHARGE: PROG

APPROVED: ECON:TGOLDBERGER
DRAFTED: ECON:TGOLDBERGER
CLEARED: NONE

VZCZCAYI744
RR RUEHC RUEHIT RUEHTV RUEHJM RUEHDA RUEHEG
DE RUEHAK #0220 0330616
ZNR UUUUU ZZH
R 020616Z FEB 07
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 0811
INFO RUEHIT/AMCONSUL ISTANBUL 2043
RUEHTV/AMEMBASSY TEL AVIV 0120
RUEHJM/AMCONSUL JERUSALEM 0287
RUEHDA/AMCONSUL ADANA 1611
RUEHEG/AMEMBASSY CAIRO 0365
UNCLAS ANKARA 000220 

SIPDIS

SENSITIVE

USTR FOR NED SAUMS AND LISA ERRION
EB FOR DAS MOORE

E.O. 12958: N/A
TAGS: ETRD EAID PREL TU
SUBJECT: TURKISH BUSINESS ECOURAGED ON GAZA PROJECT

REF: A) 2006 JERUSALEM 495, B) 2006 ANKARA 264

SENSITIVE BUT UNCLASSIFIED.

UNCLAS ANKARA 000220

SIPDIS

SENSITIVE

USTR FOR NED SAUMS AND LISA ERRION
EB FOR DAS MOORE

E.O. 12958: N/A
TAGS: ETRD EAID PREL TU
SUBJECT: TURKISH BUSINESS ECOURAGED ON GAZA PROJECT

REF: A) 2006 JERUSALEM 495, B) 2006 ANKARA 264

SENSITIVE BUT UNCLASSIFIED.


1. (SBU) Summary. Turkish business officials say they had
productive meetings in Israel in mid-January about their proposed
development of the Erez Industrial Zone in Gaza. Israeli officials
said they would start work on special tax and security arrangements
for the zone, with the MOD taking the lead working with other GOI
agencies. Palestinians are supportive in principle but have yet to
approve a concession agreement or identify potential investors.
During February 8-9 U.S.-Turkey economic meetings, Turkish business
officials will propose that the U.S. support the initiative by
providing special trade treatment for goods produced in Erez with
Turkish content. End Summary.


2. (SBU) Guven Sak, who is overseeing the Turkish business
federation TOBB's efforts to revitalize the Erez Industrial Zone in
Gaza, said his mid-January visit to Tel Aviv with TOBB Chairman
Rifat Hisarciklioglu was very productive. Hisarciklioglu went to
Israel for the third meeting of the "Ankara Forum" of Turkish,
Israeli and Palestinian chambers of industry. In addition to the
Forum meetings, he met DPM Peres and President Abbas, both of whom
reiterated their support for the project.

MOD to Coordinate Tax and Security Arrangement
-------------- -


3. (SBU) Sak stayed on for meetings with the Ministry of Defense
about security and tax arrangements for the zone and also met Lt.
General Dayton regarding security arrangements. He said the
meetings at MOD included Deputy Minister Ephraim Sneh as well as
Customs, Finance Ministry, and border authority officials. (Only
the IDF was not there, he said.) They agreed that MOD would
coordinate preparation of an MOU that covers arrangements for entry
and exit from the zone of workers and trucks and for expedited
reimbursement of tax payments collected by Israel. He also
appreciated what he said was General Dayton's willingness to help
implement security provided by Palestinian Presidential Guards once
an MOU is concluded. (He was also very thankful for ConGen
Jerusalem's help with the meeting.)

MOD Agrees to Consider Damage Compensation
--------------


4. (SBU) Another positive sign was Israeli officials' willingness
to consider TOBB's request for compensation for damage done in the
zone by the Israeli military in July (and subsequent looting by
Palestinians),as well as for the additional cost of special
security requirements created by Israel. He said he was joined in
his MOD meetings by Palestinian advisors, including former Industry
Minister Mazen Sinokrot. However, he acknowledged that the PA had
not yet approved the concession agreement with TOBB.

Looking for Asian and U.S. Investment
--------------


5. (SBU) During our February 1 meeting, Sak thought that he would
be able to begin signing up investors once the tax and security
arrangements are approved. He was pessimistic about finding
Palestinian businesspeople ready to invest, describing the
disorganization and lack of focus he found at the Palestinian
Investment Fund (PIF). He will focus first on potential Asian
investors, pitching the potential of the zone as a regional export
platform in planned trips to Japan and China. He would then
approach U.S. investors, including investor groups like the "Chicago
Ten" with which he has made contact.

Request for U.S. Support
--------------


6. (SBU) Finally, Sak said that he and Hisarciklioglu would use
February 8 business meetings of the U.S.-Turkey Economic Partnership
Commission to describe the project as an example of Turkey's
potential to contribute to economic growth and job creation in the
region. The U.S. could help, he said, by giving special treatment
to exports to the U.S. of products made in Erez with Turkish input.
He will propose that Turkish value-added count toward the 35% local
content requirement for duty free entry under the U.S.-Israel FTA or
the QIZ initiative. They will also describe other potential Turkish
contributions to trade facilitation and economic integration in
Central Asia, such as drawing on TOBB's experience in building and
operating customs facilities on Turkey's borders.
WILSON