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Mevlut Katik: 1/12/05

Turkey and Russia celebrated rapidly expanding bilateral trade during a visit by a massive Turkish trade delegation January 10-12 to Moscow. The visit also generated several significant political developments, including an announcement that Turkey would explore cooperation with the Shanghai Cooperation Organization, and a Russian commitment to consider the lifting of an embargo against Turkish Cypriots.

Turkish Prime Minister Recep Tayyip Erdogan led the Turkish delegation, comprising 52 MPs and 600 business executives. The size of contingent underscored the fact that Russia has emerged as Turkey’s second largest trade partner after Germany, in part because of Turkish imports of Russian natural gas via the Blue Stream pipeline. Bilateral trade volume in 2004 was estimated at $10 billion. The figure could skyrocket to $25 billion by 2007, Erdogan said. The centerpiece of the visit was the opening of a Turkish Trade Center in central Moscow.

Erdogan’s press office hyped the visit as “probably the busiest … made by one our [Turkey’s] leaders.” The January 12 statement went on to say that Turkey’s “economic ties with Russia are ripe for growth,” adding that Ankara expected “an influx of Russian capital.” Russian President Vladimir Putin reciprocated the enthusiasm expressed by Turkish leaders. Putin met with Erdogan at least four times during the three-day visit, including a private dinner at the presidential residence outside Moscow.

Only sketchy details have emerged on trade talks conducted during the visit. Turkish officials let it be known in advance that they would seek a discount on the price of Russian natural gas supplies. Russia currently provides about two-thirds of Turkey’s natural gas needs. According to the Interfax news agency, Russia agreed to expand gas exports to Turkey, but provided no details. There was likewise no information on the price that Turkey would pay.

Russia, at the same time, expressed interest in other Turkish energy spheres, especially electricity. “The Russians are interested in power stations that work with natural gas, coal and hydropower,” said Turkish Energy Minister Hilmi Guler. The minister added that Russian companies were interested in participating in energy-related privatization tenders, and were ready to explore the feasibility of laying down cables on the Black Sea floor to export electricity.

In addition to energy, Turkish and Russian officials confirmed that talked about developing military-technological ties. They did not go into specifics, and no agreements were announced.

Beyond the trade talks, several statements by both Turkish and Russian officials could have a profound impact on regional geopolitics. While in Kazakhstan on a one-day visit January 12, Putin welcomed Turkey’s interest in establishing trade relations with the Shanghai Cooperation Organization (SCO), which included Russia, China, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. Putin described Turkey’s interest as “unexpected,” Interfax reported.

Meanwhile, Putin indicated that Russian policy may soon shift on the Cyprus issue, which has served as an obstacle in Turkey’s path toward European Union membership. The Russian president said he would start advocating for the lifting of an international embargo on the Turkish-controlled sector of the divided island. “We do not think that the political isolation of Northern Cypriots is fair,” Putin said.

Erdogan and Putin also reportedly probed for an understanding on Armenia and the Nagorno-Karabakh conflict. [For background see the Eurasia Insight archive]. The normalization of Turkish-Armenian relations would potentially hasten Turkey’s European Union accession process. Russia, as Armenia’s strategic ally, could be in position to facilitate a rapprochement. The normalization issue, in turn, is connected to the long search for a lasting Karabakh settlement, as Turkey has long supported Azerbaijan in the peace process.

Political observers suggested that existing geopolitical conditions were exerting considerable force on Turkey and Russia to expand their political and economic ties. For Turkey, Russia potentially could help remove several obstacles still standing in Ankara’s European Union membership drive, namely the Cyprus and Armenia questions. In addition, in the wake of the diplomatic row between the United States and Turkey over Iraq, the Turkish government apparently welcomes the diversification of its foreign policy – mainly for economic purposes. Even though, Ankara has worked hard to repair its relationship with Washington, there appears to be some lingering concern over whether the United States will address Turkish security concerns in Iraq. [For additional information see the Eurasia Insight archive]. During a January 11 visit to Turkey, a top US military leader, Gen. John Abizaid, offered assurances that Washington would address the issue of Kurdish militant activity in northern Iraq, without offering a specific action blueprint. [For additional information see the Eurasia Insight archive].

For Russia, closer relations with Turkey could potentially help Moscow slow the steady erosion of its influence in the Black Sea Basin. Over the past year-plus, Russia has seen pro-Western governments come to power in Georgia and Ukraine. [For background see the Eurasia Insight archive].

Many pundits gave Erdogan high marks for his recent performance. Over the last month, Erdogan’s government has finessed the European Union into agreeing on the accession issue, taken steps to restore the US relationship, and now opened new channels of commercial and political communication with Russia. “Turkey’s foreign relations have always been very pragmatic and mostly rational, especially with its eastern neighbour Russia,” said Firdevs Robinson, the editor of the British Broadcasting Corp.’s Central Asia and Caucasus Service. “Erdogan is continuing this tradition with an important additional element. He is using Turkey’s economic potential as well as his personal charm. He is seen as ‘a leader that keeps his word.’”

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