Cablegate: Turkmenistan: Bouygues' Ship in the International

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2010-01-04

C O N F I D E N T I A L SECTION 01 OF 02 ASHGABAT 000005

SIPDIS

STATE FOR SCA/CEN; EEB
COMMERCE FOR EHOUSE

E.O. 12958: DECL: 01/04/2020
TAGS: ECON PGOV EINV TX
SUBJECT: TURKMENISTAN: BOUYGUES' SHIP IN THE INTERNATIONAL
ECONOMIC STORM

REF: 09 ASHGABAT 1643

Classified By: XXXXXXXXXXXXXX for reasons 1.4 (b) and (d).

1. (C) SUMMARY: Bouygues Batiment International, a major
French construction company, has relocated large numbers of
its staff to Turkmenistan from other international operations
that have closed due to the international economic downturn.
While Turkmenistan seems to be a cash cow for the company, a
Bouygues representative notes that working with the
government of Turkmenistan can be highly problematic: little
or no input on design, delays caused by presidential
drive-bys and demands for bribes at customs to clear needed
materials. Bouygues seems to have figured out how to stay in
Berdimuhamedov's good graces and will likely continue its
stream of "grandiose" projects as long as the money lasts.
END SUMMARY.

2. (C) According to XXXXXXXXXXX, most of the
French company's international operations have shuttered,
or greatly reduced staffing, due
to lack of projects worldwide. He mentioned specifically
operations in Moscow and throughout the Caribbean. The
glaring exception is Turkmenistan: rather than lay off all
the French nationals working around the world, the company
moved them here to try and keep up with Turkmenistan's
seemingly insatiable demand for large-scale projects
(reftel). The companyXXXXXXXXXX, who is responsible for
overseeing the 80 million dollar complex for the Institute of
International Relations, noted that most of the roughly 450
French citizens working here have arrived recently -- within
the past nine months.

3. (C) Bouygues is working on a number of design and build
contracts for the Government of Turkmenistan, including new
University complexes (classroom and student housing) and
government buildings, some of which are located in the
Archabil area to the west of Ashgabat proper. Bouygues'
leadership visited Ashgabat on December 29 and signed a
number of contracts with President Berdimuhammedov, reported
in the newspapers as, "giving start to a whole complex of
grandiose projects." While the headlines and press
statements refer to great cooperation and the honor the
Bouygues company feels to be working with Turkmenistan,
XXXXXXXXXXXX we spoke with expressed frustration
at the startling lack of input from the Turkmen side.
Bouygues consistently seeks input on what the university
directors want in their buildings, but the company is met by
blank stares and a vague order to "submit whatever you think,
and we'll review it." Seeking to maximize their value to the
Turkmen government, Bouygues consults with European
universities to determine what equipment should go into
classrooms, how the student housing is best arranged and all
the other details that should be provided by university
leadership. Frustratingly for Bouygues, when facilities with
state-of-the-art classrooms and modern European kitchens have
opened, "the Turkmen go and cook food in the courtyard in
their traditional kazans, the way they always do. It is,
please excuse me, like throwing candies before pigs. They
just don't know what to do with it."

4. (C) Echoing a source of frustration that is widely felt,
he also noted that whenever the President drives by any
construction site, they lose at least a half a day of work.
Not only are they not allowed to have workers visible, they
also need to reposition the booms of the cranes in such a way
so as to ensure that no snipers could possibly use them as a
shooter's nest. "It is strange that this president is so
paranoid." He also noted that the lost time due to
presidential peregrinations is starting to add up, and might
push the opening of some projects past their planned opening

ASHGABAT 00000005 002 OF 002

dates. He also noted delays in clearing building materials
through customs because the company refuses to pay bribes to
"expedite" the high quality goods they need to complete their
projects.

5. (C) COMMENT: This provides a glimpse into what some
international companies are willing to put up with in order
to continue working in Turkmenistan. In Bouygues' case, it
might be a marriage of convenience: the Turkmen have the
money, and they need the contracts. Likewise, the company
has learned how to do business here. Repeated visits by the
company's leadership to praise the president's economic
policies and to stay in his good graces helps to guarantee a
stream of "grandiose" projects. END COMMENT.
CURRAN

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