US embassy cable - 03ANKARA3018

UNCLAS ANKARA 003018 
 
SIPDIS 
 
 
SENSITIVE 
 
 
STATE FOR E, P, EUR/SE AND EB 
TREASURY FOR U/S TAYLOR AND OASIA - MILLS AND LEICHTER 
NSC FOR QUANRUD AND BRYZA 
 
 
E.O. 12958: N/A 
TAGS: ECON, PREL, TU 
SUBJECT: TURKISH TREASURY RAISES NEXT STEPS ON $1 BILLION 
AID 
 
Sensitive but unclassified.  Not for internet distribution. 
 
 
1.  (SBU) On May 8, Treasury Deputy Undersecretary Aydin 
Karaoz raised with Acting DCM the next steps on effecting the 
$1 billion in U.S. assistance for Turkey.  Karaoz said he had 
just returned from the annual EBRD meeting in Tashkent, where 
he had briefly discussed the issue with Treasury U/S Taylor. 
Karaoz said the GOT needed USG guidance on how to proceed. 
 
 
2.  (SBU)  Acting DCM said that, while he had not 
instructions from Washington, the logical next step would be 
for the GOT to communicate officially its need for the 
assistance, and its desire to begin talks.  Following that, 
the two side could meet in Washington, so the U.S. side could 
explain the terms and conditions in the Financial Agreement. 
 
 
3.  (SBU) Karaoz said he would consult with MinState Babacan 
and provide the GOT view, probably next week.  He also raised 
four specific questions.  What is our timing for the first 
disbursement?  Is the northern Iraq cooperation condition a 
one-time upfront condition precedent or is it a condition for 
each disbursement?  Would a USG team be willing to come to 
Ankara rather than a GOT team go to Washington?  And does the 
U.S. offer give the GOT the flexibility to choose the 
grant/loan mix the GOT wants, subject to the $8/5 billion 
cap? 
 
 
4.  (SBU) Action request:  Embassy requests guidance from 
Washington agencies on the GOT questions. 
PEARSON