Identifier
Created
Classification
Origin
08ASHGABAT590
2008-05-07 11:38:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Ashgabat
Cable title:  

CHEVRON READY TO INVEST IN SOCIAL PROJECTS (INCLUDING AT

Tags:  PGOV PREL EAID ECON ENRG EPET TX 
pdf how-to read a cable
VZCZCXRO7282
RR RUEHAG RUEHAST RUEHBI RUEHCI RUEHDF RUEHIK RUEHLH RUEHLN RUEHLZ
RUEHPW RUEHROV RUEHVK RUEHYG
DE RUEHAH #0590/01 1281138
ZNR UUUUU ZZH
R 071138Z MAY 08
FM AMEMBASSY ASHGABAT
TO RUEHC/SECSTATE WASHDC 0767
INFO RUCNCIS/CIS COLLECTIVE
RUCNMEM/EU MEMBER STATES COLLECTIVE
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEHVEN/USMISSION USOSCE 2500
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEAIIA/CIA WASHDC
RHEFDIA/DIA WASHDC
RHEHNSC/NSC WASHDC
RUETIAA/NSA FORT MEADE MD
RUEKJCS/JOINT STAFF WASHDC
RUEKJCS/SECDEF WASHDC
UNCLAS SECTION 01 OF 02 ASHGABAT 000590 

SIPDIS

SENSITIVE

STATE FOR SCA/CEN, EUR/ACE, EEB
AID/W FOR EE/EA

E.O. 12958: N/A
TAGS: PGOV PREL EAID ECON ENRG EPET TX
SUBJECT: CHEVRON READY TO INVEST IN SOCIAL PROJECTS (INCLUDING AT
AVAZA) WITHOUT A DEAL

REF: A. ASHGABAT 0453


B. ASHGABAT 0415

C. ASHGABAT 0365

UNCLAS SECTION 01 OF 02 ASHGABAT 000590

SIPDIS

SENSITIVE

STATE FOR SCA/CEN, EUR/ACE, EEB
AID/W FOR EE/EA

E.O. 12958: N/A
TAGS: PGOV PREL EAID ECON ENRG EPET TX
SUBJECT: CHEVRON READY TO INVEST IN SOCIAL PROJECTS (INCLUDING AT
AVAZA) WITHOUT A DEAL

REF: A. ASHGABAT 0453


B. ASHGABAT 0415

C. ASHGABAT 0365


1. (U) Sensitive but unclassified. Not for public Internet.


2. (U) SUMMARY: On May 1, Chevron Nebitgaz (Turkmenistan) President
told USAID Representative that Chevron is willing to invest in
social development projects prior to signing a contract in
Turkmenistan in order to demonstrate its long-term commitment to the
country. When identifying potential projects, Chevron seeks
partnership with organizations like USAID, as it has successfully
done in many other countries. With regard to specific projects,
Chevron looks for scale, impact and corporate image enhancement. To
this end, it is interested in supporting President Berdimuhamedov's
vision for the Avaza tourism zone on the Caspian coast through a
small business development program that demonstrates real impact for
local residents. Chevron also agreed to consider partnering with
USAID on a variety of ongoing economic development and
health-oriented projects. As a next step, USAID agreed to provide
more detailed information on selected USAID projects. A proposed
June visit to Turkmenistan by a US-based Chevron assessment team
will help identify specific potential opportunities for partnership.
END SUMMARY

CONTRACT NOT A PREREQUISITE TO SOCIAL INVESTMENT


3. (U) USAID Representative met with Chevron Nebitgaz B.V.
President Doug Uchikura on May 1 to discuss Chevron's interest in
partnering with USAID on devlopment projects in Turkmenistan.
Uchikura was very receptive to the concept, based on Chevron's
corporate philosophy of making long-term investments in the
countries in which it operates. Chevron's operation in Turkmenistan
is currently very small, only three staff, but Chevron is ready to
expand quickly if its efforts to sign a contract with the government
are successful. (NOTE: The first - and only, to date -- Turkmen
national hired by Chevron, Uchikura's Executive Assistant, is the
daughter of Ministry of Foreign Affairs Americas' Desk Chief, Serdar

Bashimov. END NOTE)


4. (U) Since Chevron takes a long-term approach to investing in
countries, it is willing to move forward with limited investments in
social projects as a demonstration of its commitment to Turkmenistan
prior to signing a contract. Chevron seeks to partner with
organizations like USAID, as it has successfully done in many other
countries. For example, Chevron contributed $20 million to
establish the Angola Partnership Initiative with USAID, considered a
model for public-private partnership that has expanded to include
other donors. When reviewing specific projects, Chevron looks at
their scale, the potential positive impact on the population, and
the ability to enhance its corporate image. Emphasizing the
importance of its perception among the population, Chevron wants to
support projects that deliver tangible benefits to the people.

ECONOMIC GROWTH AND HEALTH KEY PRIORITIES -- NOT DEMOCRACY


5. (U) USAID Representative provided an overview of ongoing
programs in Turkmenistan, and highlighted perceived opportunities
for partnership in areas that build capacity for sustained economic
and social development. The Junior Achievement program, which
provides market-based economics education for secondary youth across
Turkmenistan, would use additional funds to expand course offerings
to lower grades. In response to the government's interest in
introducing International Financial Reporting Standards (IFRS),
Chevron could partner with USAID to support training of university
professors and other trainers in IFRS. These trainers would prepare
a new generation of accounting specialists needed to support
increased foreign investment. USAID's AgLinks program, which
supports private farmers involved in greenhouse production and dairy
processing, presented another opportunity to cooperate.


6. (U) Chevron has a long-standing interest in the health of the
local population of countries in which it operates. To this end,
Chevron made a 3-year $30 million commitment to the Global Fund to
Fight AIDS, Tuberculosis and Malaria in January 2008. Turkmenistan

ASHGABAT 00000590 002 OF 002


has committed to submitting an application to the Global Fund's
Round 8 by June 30, 2008, which includes support from USAID in
developing the proposal. Uchikura was interested in learning more
about the status of Turkmenistan's application, and indicated that
he would urge support for the application through internal channels
if submitted. (NOTE: On May 6, USAID submitted a detailed update on
the application process and Turkmenistan's status. END NOTE.).


7. (SBU) In contrast to economic and health programs, Uchikura said
Chevron would not get involved in democracy programs in
Turkmenistan. While he supports peaceful democratic development in
general, Chevron had no interest in partnering in programs that
promote democracy in Turkmenistan, due to their negative perceptions
by the host government and the potential to disrupt business
interests.

MAKING TOURISM DEVELOPMENT WORK FOR THE PEOPLE


8. (U) Referring to President's Berdimuhamedov's repeated calls for
investment in the Avaza tourism development project on the Caspian
coast, Uchikura highlighted the disconnect between the high-profile
construction projects and the lack of focus on developing a
sustainable service sector necessary to attract tourists. The
government and investors could build many fancy hotels, but visitors
would not come - or come back -- if there was not a vibrant service
sector to support their needs. This would lead to considerable
waste of public resources and would provide no benefit to the local
economy. As a result, he was interested in a small and
medium-enterprise development project that would support human
capacity and tourism development and offer the potential to help the
Avaza project to succeed. If Chevron were to support such a
project, it should demonstrate clear positive impact on the local
population.


9. (U) Uchikura said Chevron intends to invite a US-based team to
look at programs in the field as part of a Participatory Needs
Assessment in June 2008. He asked for more detailed background
information on USAID's existing programs in Turkmenistan, including
project websites, so that the team could familiarize themselves in
advance. During the assessment, the team would visit USAID's
partners in the field to learn more about their impact. Following
that, additional discussions on potential partnerships would be
possible.


10. (SBU) COMMENT: Chevron appears to be taking a long-term view to
entering Turkmenistan's market. It has made considerable
investments in social projects in other countries, and is prepared
to do the same here. It views investing in Turkmenistan's people
ahead of a signed contract as both a signal to the government of its
commitment and an opportunity to generate positive public
perceptions. The hiring of the Americas' Desk Chief's daughter is
another shrewd political move. Doing something Avaza-connected
will also help them politically.

11. (U) COMMENT CONTINUED: Seeking public-private partnerships is
part of USAID's commitment to change the way it implements its
assistance programs. These partnerships, or Global Development
Alliances (GDA),allow USAID to catalyze the ideas, efforts and
resources of public and private sectors and civil society to
stimulate economic growth, address pressing health issues, and
expand access to education and technology to develop human
capacities. USAID is interested in developing such partnerships
with Chevron in Turkmenistan, and will continue to pursue
opportunities to leverage our limited assistance funding for greater
impact. END COMMENT.
CURRAN