Speeches

Consul General Sharon A. Wiener Addresses the Annual Dinner of the American Business Forum in Turkey, February 20.

The Consul General also read a letter from Ambassador Wilson, who was unable to attend.

Full text of address and letter follow. 

Thank you, Galip, for your kind introduction, and good evening to you, Mr. Minister, and to all of this evening’s attendees. 

I would like to begin my remarks by sharing some thoughts about our hosts tonight.  The American Business Forum in Turkey is a young organization that has filled a long-felt need. Its membership represents many of the top U.S. investors here, and its management and board work to identify both the challenges and opportunities for American companies doing business with Turkey.  Speaking personally, I would note that in my brief six months in Istanbul, I have been impressed with how active ABFT is and how frequently ABFT is at the forefront helping to organize and host meetings that bring together government officials and private companies and conferences that focus on areas of importance to both our countries.  I had been in this position for only weeks when I participated in the Bosphorous Cruise that ABFT graciously hosted for our historic energy Chiefs of Mission Conference.  In the interim I have seen the ABFT come through repeatedly for the U.S. Mission, putting together successful events, often unfortunately on unpardonably short notice.  For all this, I'm very grateful and I know Ambassador Wilson is as well.  Thank you to Galip, to Sezer and Nisa on the ABFT staff, and to all the members of ABFT, for your ongoing support.   Indeed, it is because the ABFT is such an important partner and has been so superlative in its support that Ambassador Wilson was particularly disappointed that he was not able to be here tonight with you.  The Ambassador sends his best wishes, and asked that I read the following: 

Dear Minister Guler, ABFT members and guests,

Please accept my greetings on the occasion of this annual ABFT gala dinner.

I am especially grateful to Minister Guler for his participation.  As Presidents Gul and Bush discussed last month in Washington, our bilateral cooperation on energy issues has a successful history that is reflected in the Baku-Tbilisi-Ceyhan oil pipeline, in the initial flows that began last year of Caspian basin natural gas to Turkey and European markets beyond, and in our collaboration on conferences on energy work together among government, business and other sectors of our two countries – conferences that ABFT has had a role in helping to bring about.  This cooperation reflects the importance our two governments attach to a sixty year-old alliance and to the improvement of our ties over the past two years.

It is very unfortunate that urgent business in Ankara has required me to cancel plans to come to Istanbul this evening and participate in this dinner, and I am deeply sorry to miss it.  Please be assured of my ongoing strong support for ABFT and for its work in fostering improved business, investment and overall relations between Turkey and the United States.  I will look forward to being able to participate in the energy and innovation conferences that are planned for later this year.
Sincerely, Ross Wilson

Turkey’s stellar economic performance of the past six years is the result of steady and aggressive economic reform, strong financial management and market liberalization.  Many cite the economy as a major, if not the major, reason for the reelection last year of the current National Government. 

Just as important, foreign investors have voted with their dollars.  The record $19.9 billion of Foreign Direct Investment in 2006 was again exceeded in 2007, with close to $22 billion in FDI.  This year is off to a good start, too.

We applaud Turkey’s success, but serious concerns remain about Turkey’s ability to continue to bring in this level of FDI in the highly competitive global investment marketplace, where investor appetite for risk is falling.  Like any brand, Turkey must show continual improvement to continue to attract high levels of investment.  In this regard, ABFT has performed a valuable service through its annual Survey on the Business and Investment Climate in Turkey, first conducted last year.  The results of this year’s survey – released today – both confirm Turkey’s many strengths as a magnet for foreign investment, and point to areas where change is needed to assure ongoing international investor interest.  

One area of concern is the very small proportion of greenfield investment in the FDI numbers.  In 2006, it amounted to about 10% of all FDI.  For 2007, some sources tell us the proportion is significantly lower than that.  Why are foreign companies hesitant to commit long-term, fixed assets to Turkey?  The most likely reasons for this are highlighted in the ABFT Survey:  complex bureaucracy, perceived inefficiencies and inequities in the judicial system, poor intellectual property protection – a key area for attracting the innovative, knowledge-based industry that Turkey wants – and high labor costs aggravated by an enormous informal economy which penalizes legally-established companies.

The bilateral economic and commercial agenda of the U.S. and Turkish governments relies on regular contacts with American investors and their Turkish partners, and on honest inputs from the private sector given in a constructive spirit, such as those that appear in the ABFT Survey.  Underlying this agenda is the United States’ strategic interest in seeing Turkey succeed as stable regional player and ultimately as a global economic power, and having American companies as partners in this country’s success. 

At the bilateral level, we have two primary tools at our disposal to reach our economic and commercial goals:  the Economic Partnership Commission (EPC), revived in 2007; and continuing talks under the Trade and Investment Framework Agreement (TIFA) Council.  Both of these, as I said, rely on the contributions of ABFT members and other companies and private sector organizations.  Both complement and give direction to the steady flow of high-level and working-level meetings and delegations between U.S. and Turkish officials, and events such as the Annual ATC conference, ABFT’s annual Innovation Conference, and many others.

The Economic Partnership Commission is designed as a forum for broad policy discussions, rather than focusing on specific problems and disputes.  The intended product of each EPC meeting is a list of “to-dos” – concrete actions and programs to contribute to bilateral understanding and cooperation.  Last February’s meeting resulted in an action plan, agreed to by both sides, which identified ways to work together in a range of areas, including bilateral trade and investment, energy cooperation, innovation, science and technology, educational exchanges, economic reform, and most importantly for ABFT, strengthening business-to-business cooperation.  Continued private sector input and buy-in is key to the effectiveness of the EPC and, as with last February’s meeting, we’ll continue to ask you to actively participate as we prepare for another EPC meeting in April.

In contrast to the broad scope of the EPC, the Trade and Investment Framework Agreement (TIFA) Council meetings focus on ways to increase bilateral trade and investment by resolving trade problems and investment disputes.  Our most recent meetings, in April of last year, strove to improve Turkey's protection of intellectual property, open its markets to U.S. agricultural and industrial goods, and remove impediments to private investment.  We hope that with the 2008 TIFA we can begin looking to issues such as Turkey's protectionist import regime, and encouraging Turkey to finally become a signatory to the WTO Government Procurement Agreement.

One of the items that will certainly be a topic of discussion during the upcoming TIFA meetings is an IPR Action Plan.  As many of you know, Turkey has remained on the U.S. Government’s “Priority Watch List” since 2004, in large part due to its insufficient protection of pharmaceutical test data and the enormous volume of pirated books, movies, music and apparel in the Turkish market.  While being on the Priority Watch List doesn’t incur sanctions or other negative measures, it does obligate the U.S. Mission to devote considerable time and effort to eliminating these deficiencies.  More important, inclusion on the List is a red flag to potential investors – in precisely those sectors where Turkey is most eager to attract – who may look elsewhere for a more receptive investment climate. 

Following successful visits to Washington by both the Prime Minister and President, bilateral relations have improved significantly.  Enhanced cooperation in countering the PKK has led to a thaw in many other areas.  One of these areas – one in which ABFT has been very active – is energy.  Meeting rapidly growing demand, and ensuring energy security, are areas where the U.S. government has been extremely supportive of Turkey.   We have a strong shared interest in facilitating large-scale investments in further Caspian energy development and pipeline infrastructure.  We’ve worked with Turkey and Iraq to improve energy cooperation in the region:  the trilateral gas working group that will hold its third meeting in Istanbul next month has potential for significantly augmenting Caspian resources in coming years.  We support a commercially viable Nabucco pipeline, and following the opening of the Turkey-Greece inter connector, expect that the completed link to Italy will also be an export route for Caspian and Iraqi gas.  All of these projects have promise for bolstering the role of Turkey as an indispensable energy security hub for Europe. 

In the area of nuclear power, President Bush submitted the long-delayed bilateral Peaceful Uses of Nuclear Energy Agreement (the 1, 2, 3 agreement) to Congress in January for approval. 

We actively support a continuing schedule of energy-related conferences, such as last month’s clean energy conference, and ABFT’s energy conference in April – which will enhance the participation of US firms in energy development. 

This is the kind of cooperation we hope to foster and expand in the coming years, and we look forward to working with ABFT and others to do so.  Again, Galip, thank you and your colleagues for all your support – and for this lovely evening.  Thank you.