US embassy cable - 04ANKARA3240

UNCLAS SECTION 01 OF 02 ANKARA 003240 
 
SIPDIS 
 
 
DEPT FOR EB AND EUR/SE 
DEPT PLEASE PASS USTR FOR LERRION 
USDOC FOR ITA/MAC/DDEFALCO 
 
 
SENSITIVE 
 
 
E.O. 12958: N/A 
TAGS: ETRD, TU 
SUBJECT:  Turkey's New Importers Associations 
 
 
Sensitive but Unclassified.  Please Handle Accordingly. 
 
 
1. (SBU) Summary:  A variety of private businesspersons 
suggest that the GOT's imminent creation of mandatory 
associations of Turkish importers could impede trade and 
might be inconsistent with Turkey's WTO obligations. 
The Turkish Foreign Trade Undersecretariat (FT) 
dismisses these allegations, maintaining that the 
associations are intended to enhance importers' ability 
to engage with the GOT and with external suppliers on a 
sectoral basis, and to facilitate better import 
reporting.  End Summary. 
 
 
2. (SBU) A 2001 Council of Ministers decree called for 
the establishment of associations with mandatory 
membership for all importers.  The decree is only now 
being implemented, with a July deadline for importers to 
join the associations, which are organized on a sectoral 
basis.  Representatives of Price Waterhouse Coopers, the 
Turkish Union of Chambers and Commodities Exchanges 
(TOBB), the Foreign Investors Association (YASED), the 
Turkish Industrialists' and Businessmen's Association 
(TUSIAD) and others told us they are lobbying against 
the concept and fear that the associations could be 
deployed to restrain Turkey's rapid import growth.  They 
maintain that these organizations could block or impede 
imports by interfering in pricing and quality standards 
for imported goods, and by imposing extra documentary 
requirements and fees on imports as well as membership 
fees on importing companies.  A 2004 regulation includes 
a fee proportionate to the value of goods imported as a 
potential source of revenue for the associations. 
 
 
3. (SBU) Murat Yapici, FT's Deputy Director General for 
Imports, told Econoff and Econ Specialist on June 8 that 
these allegations were unfounded and that FT had no 
intention of surrendering regulatory powers to importers 
associations.  He contradicted industry's claim that the 
new associations would have the power to manipulate 
import prices or to block imports.  Noting that the 
associations would determine membership fees, he opined 
that the fee burden on companies would likely be small 
and should not be a barrier to trade.  Yapici stated 
that the registration fee for companies and individuals 
is now set at 100 million TL (about USD 65). 
 
 
4. (U) According to Yapici, the associations, modeled on 
existing, mandatory-membership exporters unions, are 
intended to give Turkish importing companies a lobbying 
organization to represent their interests abroad as well 
as in dealings with the GOT.  As the future repository 
for electronic customs declarations, the associations 
are also intended to support faster and better 
collection of import statistics. 
 
 
5. (U) The importers associations have already begun to 
take shape, as approximately 10,000 member companies 
elected board members for sectoral associations in late 
May and early June.  These boards will shortly elect 
chairpersons, who will in turn propose a short list of 
candidates for the post of Secretary General to FT, 
which will make the final choice for this post. 
 
 
Comment 
------- 
 
 
6. (SBU) Facing a trade deficit that could exceed USD 20 
billion this year, the GOT is under some pressure from 
import-competing industries to boost protection.  While 
we are somewhat heartened by FT's explanation of the 
functions of the associations and its insistence that 
they are not intended to be a new barrier to imports, 
there is a real risk that a new series of quasi-official 
bodies will increase already burdensome bureaucracy in 
Turkey and possibly create an indirect barrier to 
imports from the United States and other countries. 
Coming at a time of heightened GOT concern about 
imports, and about their impact on domestic 
manufacturing, it is not outside the realm of 
possibility that the GOT would try to use the importers' 
association to brake import growth.  Price Waterhouse 
went so far as to allege that domestic producers would 
join the importers associations in order to use their 
powers against importing competitors. Embassy will 
continue to follow the development of importers 
associations and will advise of any negative trade 
impact. 
 
 
7. (SBU) Even if the associations prove to be benign in 
terms their impact on imports, the fact that the 
Government is mandating their creation reflects the 
continued statist, interventionist mentality of many 
Turkish officials and politicians. 
Edelman