Turkmenistan Establishes Interaction Channels with Europe

nCa News and Commentary

Ashgabat, 8 November 2007 (nCa) --- After three days of closely spaced meetings and engagements President Gurbanguly Berdymuhamedov completed the task of opening a whole cluster of interaction channels with Europe.

The real outcome of Berdymuhamedov’s first visit to a European capital would mostly depend on how far can Europe introduce an essential paradigm shift in its relations with Central Asia in general and Turkmenistan in particular.

During his visit to Brussels, 5-7 November 2007, Berdymuhamedov met most of the high officials of the European Union, top leadership of Belgium and some business executive.

On 7 November, his last day in Brussels, Berdymuhamedov had meetings with Javier Solana, EU High Representative for Common Foreign and Security Policy, Hans-Gert Pöttering, the president of the European Parliament, Jaap de Hoop Scheffer, secretary general of NATO, and Kun Minne, director general of well-known Belgian company Enex.

Solana told Berdymuhamedov that his visit to EU headquarters was significant from political and economic point of view. I respect Turkmenistan’s desire for partnership on the basis of openness, mutual respect and equality, said, Solana.

Berdymuhamedov and Solana discussed a wide range of questions related to peace, security and energy. Solana stated that because of its enormous hydrocarbon resources and reputation for reliability, Turkmenistan was a desirable partner for Europe.

Solana said that Turkmenistan was a key player in the region and its status of permanent neutrality was a positive factor for the political climate in Central Asia. European Union is unconditionally interested in expanding traditional cooperation and establishing strong and reliable relations with Turkmenistan, he added.

The talks continued during the working lunch and Soland stressed that Berdymuhamedov’s visit had elevated EU-Turkmenistan relations to a new level.

Berdymuhamedov had candid exchange of views with Hans-Gert Pöttering, the president of the European Parliament.

Pöttering expressed the desire to solidify and enlarge EU-Turkmenistan contacts in a number of areas especially the inter-parliamentary relations.

Berdymuhamedov said that all conditions are available for full-scale political dialogue and intensification of economic, scientific and cultural relations between EU and Turkmenistan. He briefed Pöttering on the ongoing constitutional and legal reforms in Turkmenistan.

The Turkmen president said that under the open-doors-policy, Turkmenistan welcomes European businessmen in all areas of economy including the hydrocarbon sector.

Pöttering expressed satisfaction with the fact that Turkmenistan was steadily moving on the path of democracy and progress.

Berdymuhamedov invited Pöttering and his colleagues to participate in the opening ceremony of the UN regional centre for preventive diplomacy in Ashgabat next month.

In his visit to the NATO headquarters Wednesday, Berdymuhamedov had a meeting with Jaap de Hoop Scheffer, secretary general of NATO

Berdymuhamedov said that Turkmenistan was highly appreciative of the Virtual Silk Road project of NATO that has provided high-speed Internet access to the educational institutions in Turkmenistan.

The president told Scheffer that control and management of emergencies and dealing with the consequences of natural disasters was an area where Turkmenistan would like to cooperate with NATO. He said that at present the ministry of defence was managing the civil defence and handling of emergency situations but soon a separate ministry would be created for this purpose.

The sides agreed that long-term cooperation in border control and joint struggle against terrorism and drugs would be in the larger interests of Central Asia and Europe.

Scheffer said that NATO fully respects and appreciates the neutral status of Turkmenistan and this would reflect in any cooperation proposals that NATO presents to Turkmenistan. He praised Turkmenistan’s contribution toward promoting stability in the region and restoration of peace in Afghanistan.

Berdymuhamedov invited Scheffer to take part in the opening ceremony of the regional centre for preventive diplomacy in Ashgabat.

Turkmenistan is a participant in the NATO Partnership for Peace (PfP) programme since 1994.

Kun Minne, director general of ENEX Process Engineering, a Belgian company actively working in Turkmenistan since 2002, also had a meeting Wednesday with Berdymuhamedov.

ENEX plans to start producing polycrystalline silicon, an essential item for solar batteries, in Turkmenistan. Minne assured Berdymuhamedov that production of solar batteries in Turkmenistan would be a giant step in developing alternate sources of energy.

Foreign ministry of Belgium and ENEX Process Engineering jointly hosted a dinner for President Berdymuhamedov Tuesday evening at Conrad Brussels Hotel. In addition to top EU and Belgian officials, and foreign ambassadors, representatives of some 180 European companies attended the dinner.

Kun Minne of ENEX made a brief speech, introducing the Turkmen president to the guests.

Pierre Morel, EU Special Representative for Central Asia, welcomed Berdymuhamedov on behalf of the European Union and highlighted the huge potential for mutual cooperation.

Berdymuhamedov said that European direction was one of the priority areas in the foreign policy and economic strategy of Turkmenistan. He expressed confidence that his visit would help strengthen relations with the countries of the European community.

Highlighting the hydrocarbon potential of Turkmenistan, Berdymuhamedov said that just before his departure for Brussels the first operational well had been put into operation at the Southern Yoloton field with one million cubic meters of gas yield per day. He said that the daily output of a new gas well at the freshly opened Osman area was 5 million cubic meters. He said that Turkmenistan plans to drill 15 operational wells in Southern Yoloton, with expected annual output of 4 billion cubic meters. This should be enough to convince everyone that Turkmenistan has ample reserves to feed all the present and proposed gas pipelines.

Berdymuhamedov said that Turkmenistan was making all efforts to stimulate foreign economic relations. He mentioned that Turkmenistan’s foreign trade turnover was around US $ 8 billion of which the European countries accounted for nearly US $ 1.5 billion. There is huge potential for growth, he added.

Berdymuhamedov drew the attention of the European business community to the fact that major investment projects were coming up fast in Turkmenistan. Some of the big projects are Caspian Coastal Pipeline, reconstruction of Central Asia – Centre gas pipeline, Turkmenistan-China pipeline and the proposed Trans Afghan pipeline, he told the audience.

We are also ready to consider the possibility to deliver Turkmen gas in the western direction to the European markets, said Berdymuhamedov.

Caspian shelf of Turkmenistan, said the president, is an attractive area for investments. He said that according to expert estimates, the Caspian sector of Turkmenistan holds about 12 billion tons of crude and 6 trillion cubic meters of natural gas.

Among the other investment opportunities he mentioned the North-South corridor, Kazakhstan-Turkmenistan-Iran railway link and Avaza tourist zone at the Caspian coast.

He said that the 650-km railway line, connecting Russia and Central Asia with the Persian Gulf, would facilitate transportation of 3-5 million tons of cargo in its initial years. He predicted that ultimately the North-South corridor would see the movement of nearly 10-12 million tons of cargo annually.

Berdymuhamedov emphasized that interesting investment projects were available in the power generation, petrochemicals, agriculture, telecommunications, construction and other sectors of Turkmenistan.

Other areas for mutual cooperation include humanitarian sector and education, he mentioned.

Berdymuhamedov said that it was better to see for yourself. He invited the European business executives to visit Turkmenistan and familiarize themselves with the potential and opportunities.

On Tuesday, 6 November, the second day of his visit to Brussels, Berdymuhamedov had a number of meetings with European officials including Andris Piebalgs, EU Energy Commissioner and Guy Verhofstadt, Prime Minister of Belgium, on his second day in Brussels.

Verhofstadt told Berdymuhamedov that Belgium was keen to promote bilateral relations with Turkmenistan in a number of potential areas. He offered to send a large delegation of Belgian ministry of economy officials and businessmen to explore the possibilities of mutually beneficial cooperation.

The Belgian prime minister said that his country was ready to establish a LNG plant in Turkmenistan and arrange for its delivery to the world markets. He said that Belgium had the technology to build such plants on floating platforms.

Berdymuhamedov replied that Turkmenistan was always open for partnership on the basis of equality and mutual benefit. He said that reconstruction of Turkmenbashy port, and creation of an ecologically clean national tourist zone at Avaza could be some of the areas of interest for Belgian investors. Belgian companies could also bid for construction of cement factories in Turkmenistan, he said.

The sides agreed that bilateral interaction could be intensified through the intergovernmental commission for economic cooperation. Healthcare and medical industry, and education, can be the potential areas for mutual cooperation. Moreover, Belgian businessmen are expected to show keen interest in Turkmen cotton.

The Belgian prime minister underlined the importance of North-South corridor in promoting the regional and international trade and cooperation.

Berdymuhamedov’s other major meeting was with Andris Piebalgs, EU Energy Commissioner.

Piebalgs said that EU was interested in promoting energy cooperation with Turkmenistan. Praising the development strategy of Turkmenistan, he said that EU would like to develop bilateral interaction not only in the traditional oil and gas sector but also in power generation.

Berdymuhamedov said that European direction was a priority area for export of energy resources of Turkmenistan.

The sides identified geological prospecting, mainland well servicing and development of hydrocarbon deposits on the Caspian shelf of Turkmenistan as some of the priority areas for mutually beneficial cooperation.

The Turkmen president said that he favours multiple routes for the export of energy resources and the EU energy commissioner supported his point of view. He said that EU stands ready to help Turkmenistan diversify its export options.

The EU energy commissioner said that he would visit Ashgabat for the forthcoming oil and gas conference.

The same day the members of the Berdymuhamedov delegation had meetings with some EU officials and businessmen.

Tachberdy Tagiyev, deputy prime minister for oil and gas, met with Rod Christie, manager of GE Energy for Central Eastern Europe, Russia and CIS.

General Electric is a long-term partner of Turkmenistan. It has supplied power generation turbines and related equipment to a number of powerhouses in Turkmenistan including the newly completed facility in Dashoguz.

The sides agreed to expand mutual cooperation.

Hydr Saparliev, deputy prime minister for education, A Alanurov, vice president of supreme council on science and technology and Ch Tugiyev, rector of Azady institute of international languages, had meetings with Gunnar Vigand, EU point man for foreign relations and other officials.

The parties discussed the potential of close cooperation in humanitarian sphere including education. The sides praised the ongoing cooperation under the TACIS and TEMPUS programmes.

It was agreed that more Turkmen students and teachers would be sent to Europe for higher education and training. A group of EU experts would soon visit Turkmenistan to discuss opportunities for mutually advantageous cooperation.

Here are some news stories related to the activities of Berdymuhamedov’s first day of Brussels visit on 5 November, as reported by www.turkmensitan.ru:

Turkmen President, EU Trade Commissioner discuss cooperation priorities

In the frames of his working visit to Brussels, Turkmen President Gurbanguly Berdimuhamedov has met with the European Union’s Commissioner for Trade Peter Mandelson in the EU headquarters. In the course of the talks, the current status, priority directions and prospects for the expansion of bilateral partnership, especially, in the sphere of investments, were discussed.

According to the Turkmen State News Agency (TDH), Peter Mandelson confirmed the increased interest and readiness of the European countries to establish large scale cooperation with Turkmenistan, stressed the exclusive attractiveness of the Turkmen market possessing a giant economic and resource potential. The EU Trade Commissioner positively assessed the steps of Turkmenistan in improving the national legislation and creation of all conditions for the development of foreign business and, namely, the favorable investment climate.

President Gurbanguly Berdimuhamedov invited Peter Mandelson to Turkmenistan in order to see first hand the reforms and get fuller perception of the country’s possibilities for the purpose of developing effective equal partnership meeting the mutual interests.

European House to open in Ashgabat, 2008

On November 6, President of Turkmenistan Gurbanguly Berdimuhamedov paying a three-day working visit to Brussels has met with the European Union Commissioner for Foreign Relations and European Good Neighborly Relations Policy Benita Ferrero-Valdner.

As the Turkmen State News Agency reports (TDH), during the meeting the opportunities of cooperation development in agriculture, the humanitarian sphere, and in the sphere of law, administration and management, as well as in settling border issues were discussed.

Benita Ferrero-Valdner invited Turkmenistan to take part in the EU’s special programs on higher education, noting that similar programs also exist in the area of assistance to local government. She welcomed the country’s efforts in fighting illegal drug spread and trafficking, the creation of the Institute for Strategic Planning and Economic Development, Interdepartmental Commission on ensuring implementation of international obligations of Turkmenistan in the human rights sphere.

The EU Commissioner expressed appreciation for the support of the EU initiative to open a European House in Ashgabat in 2008, which “will become not only a major information center but a bridge of cooperation between Turkmenistan and Europe”.

Gurbanguly Berdimuhamedov, Jose Barroso hold talks

On November 5, Turkmen President Gurbanguly Berdimuhamedov met with President of the European Commission Jose Manuel Barroso. The members of the Turkmen delegation and heads of a number of EC commissions attended the meeting.

According to the Turkmen State News Agency (TDH), Gurbanguly Berdimuhamedov stressed “European values and high living standards appeal to Turkmens”. In this context, the sides exchanged views on the state and prospects of broadening the cooperation in the number of priority areas – education, agriculture, textiles and other spheres.

A special role was attached to the further cooperation in the fuel and energy sector. According to the Jose Barroso, Turkmenistan presents interest for the European partners, considering the increasing demands of the countries of Europe in energy.

In his turn, Gurbanguly Berdimuhamedov noted Turkmenistan's interest in transporting hydrocarbons to the world markets through a multiple pipeline system. The head of state emphasized Turkmenistan, while attaching importance to diversification of export routes, intends to sell gas on the Turkmen border.

Speaking about Turkmenistan’s interaction with partners, Gurbanguly Berdimuhamedov specialy noted the absence of political bias and pressure in this dialogue. “We need reliable partners, good friends and like-minded counterparts, in relations with whom the practice of double standards will be fully excluded”, the head of state said.

Gurbanguly Berdimuhamedov invited the European Commission President to visit Turkmenistan. Thanking for the invitation, Jose Manuel Barroso said he intends to visit Ashgabat before the expiry of his mandate. At the same time, the EC President informed that the European Union’s Commissioner for Energy will visit the Turkmen capital in the middle of this month.

nCa Commentary

Berdymuhamedov’s visit to Brussels could be the start of full-scale relationship between Europe and Turkmenistan.

Europe gave a warm handshake to GB (Gurbanguly Berdymuhamedov) but stopped short of a full embrace.

Naturally, unrestrained interaction depends on a basic paradigm shift in Europe and that would not be forthcoming immediately. EU is an unwieldy body and things take some time to happen.

Energy cooperation featured prominently in most of the meetings but one could see that Europe has still not formulated a clear-cut policy to negotiate for energy resources from Turkmenistan.

Curiously, there was hardly any mention of the trans-Caspian pipeline project, the dream pipe that is supposed to carry Turkmen gas to Europe through Azerbaijan, Georgia, and Turkey.

However, the good thing is that the idea of importing electricity from Turkmenistan came up in talks. This makes sense.

Europe consumes nearly 80% of its natural gas (both local and imported) for power generation. By the time the gas reaches the power producers, its price is no less than US $ 600 per 1000 cubic meters. Buying the gas at this price, the power producers are forced to charge that much higher from the consumers.

On the other hand, Turkmenistan is already producing about 50% more electricity than it needs and this surplus capacity would increase in the next few years as more powerhouses come on line.

Buying electricity from Turkmenistan would be a low-cost and clean solution for Europe.

There are several benefits:

1. The price would be much less than what it costs to produce electricity in Europe.

2. There would be no threat to the ecology.

3. There would be no wastages or theft. Central Asia-Centre gas pipe that carries Turkmen gas to Russia and Europe is old; about 20% gas is leaked in the air as it travels to Europe. The end users pay for this gas.

4. Electricity can be stolen but metering stations at each border crossing can show where the theft has taken place.

5. No investment is required in transferring electricity from Turkmenistan to Europe because power grids and cable networks exist already all the way through Iran and Turkey.

6. In summer season Tajikistan and Kyrgyzstan also have lots of extra electricity. Europe can buy a big chunk of its power requirements from Central Asia in summer and save its own natural gas in the underground reservoirs that can be tapped in winter when consumption of both power and gas rises sharply.

While EU seemed cautious, NATO knew what to talk to GB. The sides talked in soldierly fashion; no frills, to the point. GB told NATO chief that Turkmenistan would soon establish a separate ministry to deal with emergencies and natural disasters. This is a timely decision by Turkmenistan because preparedness can save lots of grief, pain and expense in case of calamities such as earthquake, flooding, fire etc.

While the official Europe seemed guarded, the business community appeared ready to board the train to Turkmenistan. The mere fact that some 180 European business executives attended the dinner Tuesday evening speaks a lot about the readiness of the business houses of Europe to come to Turkmenistan.

How many of them would actually come and invest in Turkmenistan is a question only time can answer.