Distinguished Guests, Ladies and Gentlemen,

I am delighted to have this opportunity to address this distinguished audience. I would therefore like to earnestly thank Mr. Tichansky, President and CEO of the BCIU for kindly hosting this event at such short notice and all of you gathered here today for your interest in Turkey.

This meeting is an invaluable opportunity for me to acquaint you further with the vibrant political and economic actor Turkey has become over the course of the last few years and the major role it has assumed as a force for good in its troubled region and beyond.

In doing so, I would like to also give you a clearer perception of how our strategic partnership with the US has an important bearing on global peace and stability. As you may very well know, I have served for almost five consecutive years as the Minister of State in charge of the economy under the past two Governments established by the ruling Justice and Development Party. In 2005, I was also appointed as the Chief Negotiator in Turkey’s accession negotiations with the EU. A subject I will also touch upon briefly today. I have now been entrusted with the cabinet position of Minister of Foreign Affairs in the new Government established following the renewed mandate of the electorate.

Ladies and Gentlemen,

Our “agenda of reform” to expand civil liberties, upgrade our democracy and reap the full rewards of our true economic potential will continue to be the hallmark of our Government in this new term as well.

With the elections well behind us now, we are ready to move on in our endeavors to raise the political, economic and social standards of the Turkish people to the highest level. We are in fact already drafting a more liberal and democratic Constitution in tune with contemporary norms. We intend to seek the widest public consensus on this draft. Just prior to departing from Turkey for this trip, I also held a meeting with all relevant institutions with a view to accelerating our alignment with the EU Acquis.

Our reforms are bringing Turkey closer to its strategic objective of accession to the EU. Independent of this goal, the true incentive behind these reforms has all along been the legitimate expectations of the Turkish people for a more democratic and affluent society.

We have been making steady progress on the technical level in our accession process, where we have opened negotiations on four chapters. One of them has also been provisionally closed. We hope to start negotiations on a number of additional chapters under the current Portuguese EU Presidency.

Turkey’s membership will certainly not happen overnight. By and large it will be an uphill battle as long as certain circles persist in exploiting the process for their own narrow political motives. We are, however, determined to successfully conclude this process. Our objective is clear cut. Our intention is to bring Turkey on board as nothing less than a full and equal member of the Union. We are confident that our EU partners will also honor their commitments towards Turkey.

We have always highly appreciated the consistent moral support of the United States at every critical turn in this process for Turkey’s membership in the EU. We are confident this will continue.

The major democratic reforms realized were also complemented by important structural reforms in the economic sector. These structural reforms have provided a healthy foundation that will permit us to sustain the promising economic performance Turkey has displayed in the last years.

When we initially took office back in 2002, the Turkish economy was just emerging from an economic crisis and the economy was in pretty bad shape due to a host of chronic problems. We took bold initiatives to address them. We worked closely with the IMF. Tangible results are reflected in the figures I will share with you shortly.

Progress in our accession talks has also made Turkey a center of attraction for foreign investors. Foreign Direct Investment flows in Turkey, on average barely in the range of a billion Dollars prior to 2002, reached a record level of 20 billion Dollars in 2006.FDI flows in the first half of 2007 alone stand at 12 billion Dollars.

We have also made a quantum leap in our privatization efforts. The revenue generated by privatization in the 18 years prior to 2003 was in total 8 billion Dollars. This figure has soared to 33 billion Dollars to date with the accelerated process of privatization.

While there were some 5600 foreign firms operating in Turkey in 2002, at least 8600 new businesses were established with foreign capital between 2003 and 2006. This is due in large part to the legislation enacted in 2003 to deregulate ad reduce red tape required to start up a company in Turkey. It is now literally possible to set up shop within one day, since there no longer is any distinction made between local and foreign companies.

The Turkish economy has recorded a consecutive growth rate on average of 7.3% over the past four years. This is the highest of any OECD country. It actually represents a cumulative growth rate of 35% during this period. Our GDP has more than doubled in the same period from 181 billion to 400 billion Dollars making Turkey the 17th largest economy worldwide. The same holds true for per capita income, which is now 5,500 Dollars in comparison to 2,500 Dollars in 2002. Our goal is to raise this figure to 10,000 Dollars and double our GDP by the year 2013. Concurrent with our sustained growth, we have also been able to curb inflation. Inflation rates have fallen to single digit figures for the first time in decades. The current rate of 6.9% is the lowest anyone in Turkey can remember for almost 40 years.

We have also multiplied our trade figures. In 2002, our total volume of trade was 87 billion Dollars. Today it stands at 200 billion Dollars. Turkey is emerging as the world’s 22nd largest exporting country, with total exports valued at 97 billion Dollars. In 2002 this figure was only 36 billion Dollars. Our target for 2013 is to exceed 200 billion Dollars in worldwide exports.

All these impressive figures add up to one conclusion: growing confidence in the Turkish economy and greater prosperity for the Turkish people.

With our development sustained at these rates, projections are that Turkey will become the sixth largest economy in Europe within the next decade.

Indeed, leading international financial sources consider Turkey as one of the most promising economies among the eleven emerging countries that have the potential to influence the world economy following the BRIC countries.

I therefore encourage you to further explore the many opportunities for economic cooperation in the investment-friendly, economically and politically sound environment of Turkey.

Our overall trade with the United States reached the 10 billion Dollar mark in 2006 and US direct investments in Turkey have exceeded 5 billion Dollars. Surely this does not however reflect our true potential. We intend to further expand our economic and trade relations in accordance with the Action Plan that we jointly adopted in February this year at the meeting of the Economic Partnership Commission.

I hope that many of you present here today will be a part of this endeavor.

Ladies and Gentlemen,

The political stability and economic development that Turkey has achieved on the domestic front has enhanced its capacity to project peace and stability in its region, which features most of the international disputes that currently preoccupy us all.

Turkey quite naturally has a strong interest at stake in the restoration of peace and stability in its region and thus pursues pro-active and constructive policies to attain this objective.

To this end we continue to place the many assets of our strategic location, wide ranging ties, insight of the many issues, multi-dimensional foreign policy as well as peacekeeping capabilities at the service of regional and international peace and stability. We also contribute to the best of our ability to post-conflict reconstruction efforts.

We have consistently supported an end to the sectarian violence and a return to normalcy in neighboring Iraq. The preservation of Iraq’s territorial integrity and political unity is of critical importance for Turkey, Iraq’s neighbors and the US. The dismemberment of Iraq is clearly not an option.

To this end we advocate national conciliation through political dialogue among all groups. We played a widely acknowledged role in encouraging Sunni participation in the political process. We initiated a platform for consultations among Iraq’s neighbors with a view to contributing to the restoration of security and stability in Iraq. This process has now been expanded at our proposal to also include the P5 and G8. We will host the next Ministerial meeting in this format at the beginning of November.

We have pledged 50 million Dollars for the reconstruction effort in this country. Despite unfavorable conditions prevailing in the country, hundreds of Turkish contractors operating in Iraq have undertaken construction projects worth 4 billion Dollars. The reconstruction of the Razi Hospital in Bagdad is one such project.

Turkey continues to be the main artery of supply lines to Iraq. The Incirlik Air Base in Turkey is the main hub providing US forces logistic support. Over one million trucks transport essential goods to Iraq via Turkey each year.

A continuing point of major contention on the other hand, is the safe haven provided to terrorist elements in northern Iraq that continue to pose a serious security threat for Turkey. We expect the US to appreciate the gravity of this matter. It is our earnest hope that Iraq will swiftly implement the security cooperation agreement concluded last week. We expect |Iraq to urgently take all necessary measures to terminate the presence of the PKK terrorist organization in its territory. Acts of terror committed against Turkey from Iraq are also targeting Turkish-American interests and testing our relations.

In Afghanistan Turkey has led ISAF twice since its inception and at present has assumed the Regional Command in the capital Kabul. Our commitment to the reconstruction effort in this country is visible in the development projects undertaken by Turkey primarily in the fields of health, education and agriculture. To this end we have pledged 100 million Dollars. The Provincial Reconstruction Team (PRT) established by Turkey in the province of Wardak operating under dangerous security conditions is another dimension of this commitment. We take great pride in leading foreign investments in the country.

Turkey has provided training for the Afghan National Army. Schools built by Turkey offer some 37,000 students a better chance of education. We are supporting equal opportunity in education by building schools for girls. Some 750,000 patients have received free treatment in the Turkish built and equipped health centers.

In the Middle East we wish to see a negotiated settlement that would ensure a state to call home for Palestine, security for Israel and the promise of a lasting peace side by side for both within recognized and secure borders.

Turkey is a respected actor in the Middle East with traditionally good relations with both parties and is at the disposal of the sides to act, at their request, as an honest broker to facilitate efforts to revive the process of peace. In this connection, we are highly supportive of the US initiative to hold an international conference and ready to participate as well as constructively contribute to its objectives.

The exemplary relations that Turkey and Israel enjoy have important implications for regional peace and stability. The high mutual regard that the Turkish and Jewish peoples have for one another that traces its roots back in time to the Ottoman period, has served as a sound basis upon which the two countries have developed close cooperation in many areas over the years.

The Ankara Forum designed to build confidence between the Israelis and Palestinians by way of increased commercial ties is a novel venture launched at the initiative of Turkey. The project to revitalize the Erez Industrial Zone in Gaza, to be implemented once conditions permit, is a concrete outcome of this process.

Turkey’s participation in UNIFIL in Lebanon should also be interpreted in the light of its overall commitment to peace and stability in the region.

Our efforts to consolidate stability and guard the peace in the Balkans is also expressed in concrete terms through our participation in such operations as the EU led EUFOR-ALTHEA in Bosnia and Herzegovina and NATO led KFOR in Kosovo. Turkey has also assumed the command of the Multinational Task Force-South of the latter.

Turkey also seeks to facilitate the resolution of frozen conflicts in the South Caucasus that jeopardize regional stability. The peaceful resolution of the Nagorno-Karabakh conflict on the basis of Azerbaijan’s territorial integrity is of vital importance for peace in the region which we would like to see become a zone of prosperity rising on cooperation.

To this end we continue to invest in the infrastructure of regional cooperation through significant energy and transportation projects such as the Baku-Tbilisi-Ceyhan and Baku-Tbilisi-Erzurum oil and natural gas pipelines and Baku-Tbilisi-Kars railroad.

Ladies and Gentlemen,

The many challenges that we face in the regions cited above as well as other asymmetric threats that demand our concerted efforts have rendered the strategic partnership between the two strong allies, Turkey and the US, all the more relevant. In a global setting where peace, stability and prosperity hang in the balance, our cooperation has become indispensable.

Turkey and the United States not only share the same values and ideals but also similar regional and global objectives. Our two countries have been actively engaged to peacefully resolve disputes and negate the adverse effects of active as well as latent sources of instability which threaten international peace in a wide geography. Together we aim to promote peace, stability, democracy and prosperity across regions as the Middle East, the Black Sea, the Caucasus, Central Asia as well as in Iraq and Afghanistan.

This objective along with other issues of common concern are enumerated in the Shared Vision document, jointly adopted in July 2006 to further advance and diversify our strategic partnership. The many items of our common agenda also include: • Finding a just and lasting settlement of the Cyprus question; • Supporting international diplomatic efforts on Iran; • Working together to ensure energy security and diversity through the realization of ambitious projects such as the Baku-Tbilisi-Ceyhan oil pipeline now fully operational; • Strengthening transatlantic relations; • Countering terrorism and preventing the proliferation of Weapons of Mass Destruction; • Combating illegal drug trafficking; • Furthering understanding and tolerance between cultures through support for initiatives as the one co-sponsored by Turkey for an Alliance of Civilizations, and • Promoting effective multilateral action to find solutions to international challenges of common concern.

Accordingly, we seek to translate this shared vision into effective cooperation in the pursuit of common global interests. Ladies and Gentlemen,

While our countries are increasingly drawn into closer cooperation on a wide range of issues, we must also avoid placing undue strains on our relations that could have detrimental consequences for our bilateral ties.

There have always been circles that have sought to jeopardize this partnership and place our strategic cooperation at risk. I am referring in particular to those single interest groups that seek to advance their own narrow political agenda at the cost of the greater interests of our two countries. It is our earnest hope that the US will not fall for this.

Draft resolutions brought before the US Congress in an attempt to unjustly implicate an entire nation on the grounds of unfounded allegations surrounding contested events of a particular period in history, only serve to alienate and cause a profound sense of indignation in the Turkish public opinion. It would also seriously tarnish the image of the US in the public eye.

The adoption of House Resolution 106 regarding the events of 1915 would deal a severe blow to every aspect of our relations and overshadow our strategic cooperation. Such a move would also be far from productive in terms of the future of our relations with Armenia.

Regarding 1915, Turkey’s proposal to Armenia to establish a joint commission of impartial historians is the only realistic way to proceed in order to shed light on these disputed events and put history behind us.

As we look to the future instead, we are confident that the reciprocated conviction that the Turkish-American partnership matters, will help us diversify our mutual interests and expand our cooperation. We cherish this partnership and believe that as it grows stronger it will not only benefit our two countries but will also have an important positive impact on a wider scale.

I will conclude on that positive note.

I thank you for your kind attention.