Identifier
Created
Classification
Origin
09ASHGABAT1248
2009-09-30 12:51:00
CONFIDENTIAL
Embassy Ashgabat
Cable title:
TURKMENISTAN: U.S. LOGISTICS COMPANY EXPLAINS
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C O N F I D E N T I A L ASHGABAT 001248
SIPDIS
STATE FOR SCA/CEN; EEB; NEA/IR
ENERGY FOR EKIMOFF/BURPOE/COHEN
COMMERCE FOR EHOUSE
E.O. 12958: DECL: 09/29/2019
TAGS: EINV ETRD EPET BTIO PGOV ECON TX
SUBJECT: TURKMENISTAN: U.S. LOGISTICS COMPANY EXPLAINS
SUCCESS
Classified By: Charge Sylvia Reed Curran for reasons 1.4 (b) and (d).
C O N F I D E N T I A L ASHGABAT 001248
SIPDIS
STATE FOR SCA/CEN; EEB; NEA/IR
ENERGY FOR EKIMOFF/BURPOE/COHEN
COMMERCE FOR EHOUSE
E.O. 12958: DECL: 09/29/2019
TAGS: EINV ETRD EPET BTIO PGOV ECON TX
SUBJECT: TURKMENISTAN: U.S. LOGISTICS COMPANY EXPLAINS
SUCCESS
Classified By: Charge Sylvia Reed Curran for reasons 1.4 (b) and (d).
1. (C) On September 28, Economic Officer met with the
Managing Director of U.S.-based Bertling Logistics. The
Bertling representative, who was raised in Turkey and has
been in Ashgabat for 10 years, asserted that commercial
conditions in the country have improved immensely in the last
few years. He highlighted that 2009 had been the company's
most profitable year in Turkmenistan and that 2010 prospects
were even brighter. He anticipated several large commercial
projects in the energy and infrastructure sectors that U.S.
companies would find attractive. Bertling's success and its
positive take on the Turkmen business climate were
refreshing, given that several U.S. companies remain mostly
downbeat on opportunities in Turkmenistan.
2. (C) The Bertling representative referred to the Turkmen
government's "Strategy for Political, Economic and Cultural
Development of Turkmenistan up to 2020," noting that this
former President Niyazov initiative adopted in 2001 has had
little traction since Niyazov's death in 2006. The plan's
original production projections were far from realistic. For
instance, the plan called for the production of 48 million
tons of oil and 125 billion cubic meters (bcm) of natural gas
by 2010, but the Turkmen only produced 10 million tons of oil
and only 75 bcm of gas. (Note: The plan's goals for
agricultural and infrastructure projects are reportedly so
far-fetched that Turkmen officials reportedly check off
accomplishments on paper, not having actually accomplished
many of the unrealistic goals. End note.) Nevertheless, the
current President reportedly refers to the plan from
time-to-time, which has helped foreign companies capture some
unexpected business when the GOTX needed a deliverable for
the President right away.
3. (C) According to the Bertling representative, all foreign
businesses should understand the Turkmen motto (borrowed from
Farsi): "yuwash, yuwash" which means things move very
slowly. He illustrated his point by recounting how the
Bertling office he opened in 1999 did not have any real
clients for over a year. Through building relationships and
showing respect for Turkmen culture and ideas, he added,
Bertling's clientele grew, despite bureaucratic red tape and
the GOTX's swift, harsh approach to foreign companies that
get on the GOTX's bad side. He stated that his logistics
company deals with many government agencies such as the
customs, tax, and migration departments on a regular basis,
so building person relationships of trust with officials and
maintaining flexibility have resulted in Bertling's increased
success.
4. (C) Regarding corruption in Turkmenistan, the Bertling rep
said it clearly exists on many levels, but companies that
exercise ethical practices do get rewarded for persistence.
He wagered that most Turkmen government officials believe "a
person holding the honey pot always licks his fingers," but
Turkmen are aware that U.S. companies cannot by law sweeten
the pot to get business contracts. He commented that Turkmen
pride requires a lot of respectful gestures from potential
business partners, and respectful gestures do not have to
translate into gifts or bribes. He maintained that
remembering names, birthdays, holidays, and introducing
people to contacts were legal and acceptable means of showing
respect and building lasting relationships.
5. (C) COMMENT. The Bertling representative's cultural
insight on the Turkmen business culture meshes with what many
Turkmen have been telling us: the Turkmen value relationships
and respect over the most logical and best put-together
business proposal. Appealing to the President's vanity is
also a critical component for achieving success in
Turkmenistan. After 10 years, Bertling's thick skin and
understanding of the Turkmen business psyche are paying large
dividends both figuratively and literally. END COMMENT.
CURRAN
SIPDIS
STATE FOR SCA/CEN; EEB; NEA/IR
ENERGY FOR EKIMOFF/BURPOE/COHEN
COMMERCE FOR EHOUSE
E.O. 12958: DECL: 09/29/2019
TAGS: EINV ETRD EPET BTIO PGOV ECON TX
SUBJECT: TURKMENISTAN: U.S. LOGISTICS COMPANY EXPLAINS
SUCCESS
Classified By: Charge Sylvia Reed Curran for reasons 1.4 (b) and (d).
1. (C) On September 28, Economic Officer met with the
Managing Director of U.S.-based Bertling Logistics. The
Bertling representative, who was raised in Turkey and has
been in Ashgabat for 10 years, asserted that commercial
conditions in the country have improved immensely in the last
few years. He highlighted that 2009 had been the company's
most profitable year in Turkmenistan and that 2010 prospects
were even brighter. He anticipated several large commercial
projects in the energy and infrastructure sectors that U.S.
companies would find attractive. Bertling's success and its
positive take on the Turkmen business climate were
refreshing, given that several U.S. companies remain mostly
downbeat on opportunities in Turkmenistan.
2. (C) The Bertling representative referred to the Turkmen
government's "Strategy for Political, Economic and Cultural
Development of Turkmenistan up to 2020," noting that this
former President Niyazov initiative adopted in 2001 has had
little traction since Niyazov's death in 2006. The plan's
original production projections were far from realistic. For
instance, the plan called for the production of 48 million
tons of oil and 125 billion cubic meters (bcm) of natural gas
by 2010, but the Turkmen only produced 10 million tons of oil
and only 75 bcm of gas. (Note: The plan's goals for
agricultural and infrastructure projects are reportedly so
far-fetched that Turkmen officials reportedly check off
accomplishments on paper, not having actually accomplished
many of the unrealistic goals. End note.) Nevertheless, the
current President reportedly refers to the plan from
time-to-time, which has helped foreign companies capture some
unexpected business when the GOTX needed a deliverable for
the President right away.
3. (C) According to the Bertling representative, all foreign
businesses should understand the Turkmen motto (borrowed from
Farsi): "yuwash, yuwash" which means things move very
slowly. He illustrated his point by recounting how the
Bertling office he opened in 1999 did not have any real
clients for over a year. Through building relationships and
showing respect for Turkmen culture and ideas, he added,
Bertling's clientele grew, despite bureaucratic red tape and
the GOTX's swift, harsh approach to foreign companies that
get on the GOTX's bad side. He stated that his logistics
company deals with many government agencies such as the
customs, tax, and migration departments on a regular basis,
so building person relationships of trust with officials and
maintaining flexibility have resulted in Bertling's increased
success.
4. (C) Regarding corruption in Turkmenistan, the Bertling rep
said it clearly exists on many levels, but companies that
exercise ethical practices do get rewarded for persistence.
He wagered that most Turkmen government officials believe "a
person holding the honey pot always licks his fingers," but
Turkmen are aware that U.S. companies cannot by law sweeten
the pot to get business contracts. He commented that Turkmen
pride requires a lot of respectful gestures from potential
business partners, and respectful gestures do not have to
translate into gifts or bribes. He maintained that
remembering names, birthdays, holidays, and introducing
people to contacts were legal and acceptable means of showing
respect and building lasting relationships.
5. (C) COMMENT. The Bertling representative's cultural
insight on the Turkmen business culture meshes with what many
Turkmen have been telling us: the Turkmen value relationships
and respect over the most logical and best put-together
business proposal. Appealing to the President's vanity is
also a critical component for achieving success in
Turkmenistan. After 10 years, Bertling's thick skin and
understanding of the Turkmen business psyche are paying large
dividends both figuratively and literally. END COMMENT.
CURRAN