As previously reported on this blog, with Moscow blocking imports of food from several European and western countries in response to sanction placed on Russia, Turkish food makers are seeing an opportunity for boosting their exports.
Despite objects from some European neighbors that Turkey is "exploiting" the situation at the expense of solidarity in the face of Russia's destabilizing actions in Ukraine, the efforts by Turkish exporters appear to be continuing. Reports Russia's ITAR-TASS news agency:
Turkey plans to increase food supplies to Russia to $3.0 billion in 2015 from $1.2 billion in 2013 if customs duties are lowered, Zechariah Mete, chairman of the country’s grocery products exporters association, said Tuesday. “We do not ask for special privileges or preferences. We request that (customs) duties (for the country) are set equal to that of the EU. There is no reason to put Turkey in another tax category,” Mete said. Turkey has a potential to raise annual food exports to Russia to $3 billion-$4 billion in 2015-2016, he said.
Turkey is ready to export poultry, fish, dairy products, fruits, vegetables, confectionery, cereals, legumes and oil-plants.
Turkey also plans to double its sweets supplies to Russia to $80 million in 2015 from around $37 million in 2013 on the background of rising interest from Russian companies to counteragents from countries which did not support sanctions against Moscow, Hidayet Kadiroglu, head of the association’s confectionery direction, said. Turkey may raise its confectionary supplies to Russia to $2 billion in the long run.
While European and North American food producers might be worried about the sting of Russia's new ban on western produce, Turkish exporters could soon be celebrating.
As the Wall Street Journal reports, Moscow's ban -- enacted in response to western sanctions on Russia to punish it for its role in the current crisis in Ukraine -- is providing Turkey with an opportunity for expanding its agricultural exports:
Russian President Vladimir Putin's decision last week to block certain food imports from the European Union and the U.S. is a potential boon for Turkey just as Islamist insurgents in Iraq choke off trade to key markets for Turkish goods. Exporting food to Russia could also help make up for slowly recovering demand from the EU, Turkey's biggest market.
Shipping more fruit, vegetables and dairy products would also aid Turkey in plugging an annual trade deficit of about $20 billion with Russia.
"This is 100% positive, we need to seize this opportunity, Russia can devour everything we produce," said Ahmet Ozer, vice president of the general assembly at the Istanbul Chamber of Commerce. "We don't have energy like Russia, but we have agriculture, water and farmlands; we must work them and sell our produce."
Last year, Turkey sold $7 billion worth of goods to Russia, which Mr. Ozer said could jump by 25% as Moscow turns to Ankara, among others, for food it previously imported from Australia, Canada, Norway, the U.S. and the EU.
As noted in a recent post on this blog, Russia's moves regarding Crimea left Turkey facing something of a conundrum, unable to protest too much because of its crucial trade and energy ties with Moscow.
As the crisis in Ukraine continues, Turkey's dilemma regarding how to respond to developments there has only deepened, posing an even stickier challenge for Turkish-Russian relations -- something which Eurasianet's Dorian Jones covered in an article today.
In an analysis that was also released today, Ian Lesser, director of the German Marshall Fund's Brussels office, takes a further look at how the conflict over the future of Ukraine is testing Turkish foreign policy. Writes Lesser:
As the images distributed the other day by the Turkish press of Russian naval vessels steaming through the Bosphorus made clear, Ankara has little choice about being involved in the ongoing crisis surrounding Crimea.
Beyond its geographic proximity to the peninsula in the Black Sea, Turkey also has deep historical ties to Crimea, once an Ottoman province, and strong interests there, especially with regards to the fate of Muslim Crimean Tatars, who make up an estimated 15 percent of the population.
Turkish Foreign Minister Ahmet Davutoglu recently expressed his concern about how developments in Crimea might impact the Tatars and today his ministry issued a statement calling the upcoming referendum there on whether the region should become part of Russia as a "wrong" move.
But just how much can Ankara do in the face of Moscow's moves in Crimea? The truth is very little. Write the Washington Institute for Near East Policy's Soner Cagaptay and James Jeffrey in a brief released this week:
Up until only the last two years, the question of whether Turkey was "drifting east" seemed to dominate any discussion regarding the country and its future trajectory. But an improved Turkish relationship with the United States, a deteriorating one with Iran and a deepening involvement with NATO have all contributed towards pushing that question into the background.
Now, though, it's none other than Turkish Prime Minister Recep Tayyip Erdogan who has helped revived the "drifting east" debate. Speaking on Turkish television the other night, the PM was asked about his country's stalled and troubled European Union membership drive. Erdogan's blunt bombshell of an answer suggested Turkey is considering dropping its EU bid in favor of joining the China- and Russia-led Shanghai Cooperation Organization (SCO). “When things go so poorly, you inevitably, as the prime minister of 75 million people, seek other paths. That's why I recently said to Mr. [Vladimir] Putin: ‘Take us into the Shanghai Five; do it, and we will say farewell to the EU, leave it altogether. Why all this stalling?'” Asked to elaborate, Erdogan said, “The Shanghai Five is better and more powerful and we have common values with them.” (The SCO last year upgraded its relations with Turkey, naming the country a "dialogue partner.")
Russian President Vladimir Putin came to Turkey this week -- after suddenly canceling a visit that was supposed to take place in October -- and there was a certain element of suspense to the trip. Although Russia is Turkey's top trading partner and the two countries have also been deepening their political ties in recent years, Ankara and Moscow have not seen eye-to-eye on some key regional issues -- the fate of Syria and the Assad regime, in particular -- and the question was whether these tensions would surface during Putin's visit.
In the end, there was little drama. As The Economist writes of the Russian leader's visit, the two countries have decided to let "cool pragmatism" rule their relations:
“The level of economic and political relations is such that neither Turkey can forgo Russia, nor Russia Turkey…the future of Assad is nothing,” argued Mehmet Ali Birand, a veteran commentator.
Turkey's forcing down of a Syrian civilian jet earlier this month on it way from Moscow to Damascus on suspicion that it was carrying military cargo was certainly a bold move by a country intent on showing its regional leadership. But two weeks later, the issue of the plane's cargo appears to remain a bone of contention between Ankara and Moscow, which has been both increasing its political and economic cooperation with Turkey while, at the same time, watching its growing regional ambitions with some concern.
Back in July, when I wrote a piece for Eurasianet looking at how their differing position on how to resolve the Syria crisis might impact relations between Turkey and Russia, most analysts I spoke to seemed to agree that while the Syrian crisis might lead to some increased tension, Ankara and Moscow have found a way to "compartmentalize" their disagreements. But now, following Turkey's interception of a Syrian passenger jet that was en route from Moscow to Damascus, perhaps it's time to consider the differences between Ankara and Moscow decompartmentalized.
According to Turkish Prime Minister Recep Tayyip Erdogan, the Syrian Arab Airlines jet -- which was forced to land Wednesday at Ankara's Esenboga airport by two Turkish F-16's -- was carrying munitions and other military equipment that a civilian aircraft should not be transporting. Moscow, meanwhile, has not only denied that the plane was carrying any weapons, but has also demanded an explanation from Ankara for its actions and suggested that the interception of the airliner “threatened the life and safety” of the several Russian passengers who were on the jet.
From being Cold War adversaries, Turkey and Russia have taken significant steps in recent years towards deepening their economic and political ties, to the point that some Turkish pundits started describing their relationship as a "strategic alliance." Trade between the two countries has blossomed (although much of it is in the form of Russian gas flowing into Turkey), while Ankara and Moscow have also agreed to scrap visa requirements for one-month-long stays.
But recent events regional events, which have found Ankara and Moscow taking divergent views, are putting the budding relations between Turkey and Russia to the test. Russia's heavy investment in Greek Cyprus has not gone unnoticed by Ankara. But an even greater challenge is being posed by the uprising in Syria and Moscow's continuing support for the Assad regime. As analyst Ziya Meral writes in a recent piece for Bitterlemons-international.org:
....just as the so-called "Arab spring" has soured the budding romance between Syria and Turkey, there are underlying anxieties over how long Turkey can keep calm about Russian involvement in Syria.
From the Turkish point of view, Russian interests in Syria are thin. A small symbolic naval base, seemingly lucrative yet limited arms sales, and assertion of the usual bravado of "standing against colonial western interventionism" are no compensation for what Russia stands to lose through its dangerous Syria policy.
Ankara ended 2011 with a pair of big -- and seemingly contradictory -- gas pipeline deals that are almost certain to alter the regional energy picture but that have also raised some interesting questions about the goals of Turkey's energy policy.
The first deal was a memorandum of understanding signed with Azerbaijan on December 26 to build a pipeline that would take Azeri gas across Turkey. Called the Trans-Anatolia Gas Pipeline, the project is scheduled to be finished in 2017 and would initially carry 16 billion cubic meters (bcm) of gas, to be expanded to 24 bcm. (For more background on the project, take a look at this previous post and at this Jamestown Foundation analysis.)
With its guarantee of a steady supply of gas flowing westward, the Turkish-Azeri deal was hailed by many as the first tangible step towards finally creating a "southern corridor" for the delivery to Europe of non-Russian gas. But, with the ink barely dry on that agreement, Russian Prime Minister Vladimir Putin and Gazprom CEO Aleksei Miller on Dec. 30 announced that Ankara had given Moscow the green light to go ahead and build South Stream, designed to take some 63 bcm of Russian gas to Europe, through Turkey's Black Sea territorial waters. As Putin put it, Ankara had just given Moscow a "wonderful Christmas gift."