TURKMENISTAN: BOUYGUES' SHIP IN THE INTERNATIONAL

2010-01-04 C O N F I D E N T I A L SECTION 01 OF 02 ASHGABAT 000005 SIPDIS STATE FOR SCA/CEN; EEB COMMERCE FOR EHOUSE E.O. 12958: DECL: 01/04/2020 TAGS: ECON PGOV EINV TX SUBJECT: TURKMENISTAN: BOUYGUES' SHIP IN THE INTERNATIONAL ECONOMIC STORM REF: 09 ASHGABAT 1643 Classified By: XXXXXXXXXXXXXX for reasons 1.4 (b) and (d). ¶1. (C) SUMMARY: Bouygues Batiment International, a major French construction company, has relocated large numbers of its staff to Turkmenistan from other international operations that have closed due to the international economic downturn. While Turkmenistan seems to be a cash cow for the company, a Bouygues representative notes that working with the government of Turkmenistan can be highly problematic: little or no input on design, delays caused by presidential drive-bys and demands for bribes at customs to clear needed materials. Bouygues seems to have figured out how to stay in Berdimuhamedov's good graces and will likely continue its stream of "grandiose" projects as long as the money lasts. END SUMMARY. ¶2. (C) According to XXXXXXXXXXX, most of the French company's international operations have shuttered, or greatly reduced staffing, due to lack of projects worldwide. He mentioned specifically operations in Moscow and throughout the Caribbean. The glaring exception is Turkmenistan: rather than lay off all the French nationals working around the world, the company moved them here to try and keep up with Turkmenistan's seemingly insatiable demand for large-scale projects (reftel). The companyXXXXXXXXXX, who is responsible for overseeing the 80 million dollar complex for the Institute of International Relations, noted that most of the roughly 450 French citizens working here have arrived recently -- within the past nine months. ¶3. (C) Bouygues is working on a number of design and build contracts for the Government of Turkmenistan, including new University complexes (classroom and student housing) and government buildings, some of which are located in the Archabil area to the west of Ashgabat proper. Bouygues' leadership visited Ashgabat on December 29 and signed a number of contracts with President Berdimuhammedov, reported in the newspapers as, "giving start to a whole complex of grandiose projects." While the headlines and press statements refer to great cooperation and the honor the Bouygues company feels to be working with Turkmenistan, XXXXXXXXXXXX we spoke with expressed frustration at the startling lack of input from the Turkmen side. Bouygues consistently seeks input on what the university directors want in their buildings, but the company is met by blank stares and a vague order to "submit whatever you think, and we'll review it." Seeking to maximize their value to the Turkmen government, Bouygues consults with European universities to determine what equipment should go into classrooms, how the student housing is best arranged and all the other details that should be provided by university leadership. Frustratingly for Bouygues, when facilities with state-of-the-art classrooms and modern European kitchens have opened, "the Turkmen go and cook food in the courtyard in their traditional kazans, the way they always do. It is, please excuse me, like throwing candies before pigs. They just don't know what to do with it." ¶4. (C) Echoing a source of frustration that is widely felt, he also noted that whenever the President drives by any construction site, they lose at least a half a day of work. Not only are they not allowed to have workers visible, they also need to reposition the booms of the cranes in such a way so as to ensure that no snipers could possibly use them as a shooter's nest. "It is strange that this president is so paranoid." He also noted that the lost time due to presidential peregrinations is starting to add up, and might push the opening of some projects past their planned opening ASHGABAT 00000005 002 OF 002 dates. He also noted delays in clearing building materials through customs because the company refuses to pay bribes to "expedite" the high quality goods they need to complete their projects. ¶5. (C) COMMENT: This provides a glimpse into what some international companies are willing to put up with in order to continue working in Turkmenistan. In Bouygues' case, it might be a marriage of convenience: the Turkmen have the money, and they need the contracts. Likewise, the company has learned how to do business here. Repeated visits by the company's leadership to praise the president's economic policies and to stay in his good graces helps to guarantee a stream of "grandiose" projects. END COMMENT. CURRAN