POLIMEKS EXECUTIVE WANTS COLLABORATION WITH U.S.

UNCLAS SECTION 01 OF 02 ASHGABAT 001064 SIPDIS SENSITIVE SIPDIS STATE FOR SCA/CEN, EEB E.O. 12958: N/A TAGS: PGOV ECON EIND SOCI TU TX SUBJECT: POLIMEKS EXECUTIVE WANTS COLLABORATION WITH U.S. FIRMS, BUT DOWN ON TURKMENISTAN REF: A. REF: A. ASHGABAT 968 ¶B. B. ASHGABAT 970 ¶C. C. ASHGABAT 1039 ¶1. (U) Sensitive but unclassified. Not for public Internet. ¶2. (SBU) SUMMARY: On September 27, a senior Turkish construction company official outlined the difficulties of living and doing business in Turkmenistan, such as police harassment and lack of Internet access, and how it makes finding expatriate employees difficult. He explained ongoing and new projects, and expressed interest in collaboration on turnkey projects with U.S. firms. He claimed that construction is not a profitable business for the many Turkish companies that have been doing business here since Turkmenistan's independence, but they come because it is the right thing to do. In our view, however, the companies would not have been here for over a decade simply to "do good." END SUMMARY. LIFE IN TURKMENISTAN: EVEN HARDER IF YOU'RE NOT A DIPLOMAT... ¶3. (SBU) Caner Demir, Architect and Deputy Planning Manager of the Turkish construction firm Polimeks, noted his concerns about inconveniences of life in Turkmenistan during a September 27 introductory meeting with econoff. Stating that it can be difficult to find Turks willing to live and work in Turkmenistan, he said that U.S. private industry might also have trouble convincing employees to come here. Noting Polimeks' lack of Internet in the office and concerns about education, Demir was somewhat discouraged about Berdimukhamedov's presidency. He asked if the U.S. Embassy heard about a new rule imposed on Polimeks employees prohibiting single men from living alone, and an "unwritten rule" that no one is allowed to be on the street after 11 p.m. (COMMENT: The 11:00pm curfew is widely known, but this was the first time we had heard of the supposed ban on single men living alone. END COMMENT.) Demir returned to the topic of police harassment throughout the meeting, clearly an issue of concern to him. (NOTE: Demir is married to a Turkish Embassy employee and, therefore, is personally protected from hassles. END NOTE.) ...BUT BUSINESS IS MOVING ALONG ¶4. (SBU) Demir noted that Polimeks is working on two new projects: a cottonseed oil processing plant in Ashgabat, and a water purification plant in Turkmenbashy. He declined to provide details on two additional projects that he expected Berdimukhamedov to approve after he returned from New York. Demir does not want to participate in Avaza projects (reftels A, B),because he does "not believe in it." He believed, however, Polimeks management may want to submit bids for building projects there, in spite of his views. RUSSIA NOT A THREAT TO BUSINESS (YET) ¶5. (SBU) Demir highlighted two of Polimeks' 17 ongoing projects, both located next to the Ministry of Healthcare: a high-rise oncology center and a new medical university. He said Polimeks wants to collaborate with U.S. firms on turnkey projects in the healthcare industry, and asked for a list of U.S. firms currently operating in Turkmenistan. He also said that Russian and German companies recently participated in a new tender for a turnkey hospital project. He did not feel threatened by Russian construction firms at present because of the low quality of their work, but worried they might soon catch up as their workforce becomes more skilled. He credited the increase in skills in the Russian construction workforce to the influence and training of Turkish firms that have been operating in Russia. ¶6. (SBU) Demir claimed his manager and other Turks involved ASHGABAT 00001064 002 OF 002 in construction in Turkmenistan arrived with altruistic ideals. Profit margins are not high compared to similar projects in Turkey. "First you come to do some good, then you can make some money," he added. Noting that Berdimuhamedov and Turkey's President Gul have yet to exchange visits, he said he did not feel that the close business relations have fostered better political relations. ¶7. (SBU) Demir complained prominent French construction company Bouygues doesn't "talk to anyone" and is a "black box." Demir felt strongly that Bouygues was trading building projects for oil and gas, and suggested the company was not a private entity but somehow part of the French government. ¶8. (SBU) COMMENT: While Demir made some good points, it was clear he held an over-inflated view of the role of Turkish companies here and the benefits they bring to the country. In this meeting, he also showed a side of the fierce competition that exists between the few foreign construction companies that operate here. His comments on Avaza, like those of other international business entities, reinforce the notion that few companies are interested in this pet project before the investment climate warms and a clearer picture of the project appears. END COMMENT. HOAGLAND