US embassy cable - 03ANKARA5658

UNCLAS ANKARA 005658 
 
SIPDIS 
 
 
DEPT FOR NEA/NGA, EUR/SE AND PRM/ANE 
 
 
SENSITIVE 
 
 
E.O. 12958: N/A 
TAGS: ETRD, ELTN, ENRG, PREL, TU, IZ 
SUBJECT:  Foreign Trade Undersecretary on Booming Trade 
With Iraq, Border Congestion 
 
REF:  STATE 250386 
 
 
1. (U) Baghdad minimize considered. 
 
 
Summary: 
-------- 
 
 
2. (SBU) In a September 5 meeting with Econ Counselor 
and Econoff, Foreign Trade Undersecretary Tuncer Kayalar 
predicted that Turkish exports to Iraq would continue to 
grow quickly, and said that an intense inspection regime 
aimed at combatting smuggling and fraud is the reason 
for delays at the Habur border crossing.  Kayalar made 
no substantive reply to EconCouns' demarche on 
Eximbank's plans for a framework agreement with the 
Trade Bank of Iraq (reftel).  End Summary. 
 
 
3. (U) Meeting with Foreign Trade U/S Tuncer Kayalar, 
EconCouns delivered reftel demarche on Eximbank's plans 
to negotiate a framework agreement to insure lending by 
the Trade Bank of Iraq, emphasizing that this move is 
not aimed against third country exporters.  In response 
to EconCouns' question on Turkish-Iraqi trade, Kayalar 
responded that Turkey is currently exporting about USD 
100 million to Iraq monthly and expects to reach USD one 
billion by year-end.  He expects trade to continue to 
grow in 2004. 
 
 
4. (SBU) Kayalar stated that border delays at the sole 
crossing in Habur are the result of Turkish Customs' 
close inspection of trucks to counter smuggling and 
fraud.  He said 74 trucks had been stopped because their 
drivers had sold part of their fuel cargo in Turkey and 
replaced it with water before attempting to enter Iraqi 
territory.  Truckers are also smuggling on the return 
trip to Turkey. 
 
 
5. (SBU) Kayalar said the GOT was keen to facilitate 
bilateral trade through a second border crossing, and 
establishing direct rail links and border trade centers 
which would allow duty free trade between firms and 
individuals in the border regions of both countries. 
Edelman