July 3, 2015

Turkey-Russia: the Strategic Consensus Has Been Delayed

The key political event determining today the situation in the Republic of Turkey, the ruling Justice and Development Party (AKP)'s losing the dominant electoral position among the Turkish population, which is why in the nearest future the country can be covered with the permanent political instability.

This will not allow to realize the initiated by President R. Erdogan constitutional reform (providing for a significant expansion of presidential powers), but will strengthen the negative trend in the Turkish economy (first of all it will devalue the Turkish lira by 16 %), reduce the foreign investments and increase the debt. Unemployment will rise to 11.2 %, including among young people it will grow by 20 %, which in the nearest future may become the Turkish government's sharpest problem.

June 7 in the parliamentary elections, the AKP did not win (for the first time since 2002) the right to solely form the government (according to Turkish law, it is necessary to get at least 276 seats against 258 — the “president and prime minister's” party has today). Besides, President Recep Tayyip Erdogan is in an unpleasant situation of the reduced ability to implement the proposed by him concept of constitutional reform aimed at establishing Turkish presidential-parliamentary form of government. Because to make the necessary changes to the Constitution, he needs the support of 367 deputies.

These results of the parliamentary elections accelerate internal centrifugal processes of the ruling political force. In particular, some members of the AKP accuse the Head of the Party, the Prime Minister Ahmet Davutoglu of his being carried away by the ideology of Eurasianism and neo-Ottomanism, in particular, by “too democratic approaches” to solving the Kurdish issue.

At the same time, the electoral programs of all parties that made their way into the parliament contain points about significant support for a constructive relationship with Russia. This is due, above all, to the notable level of anti-Western sentiment in the Turkish society and political circles, regardless of party affiliation or personal sympathies. In particular, the presence of certain pro-Russian orientation in the Kurdish media can be explained by Kurds' traditional ties with Russia (the Co-Head of the Democratic Party of Peoples Selahattin Demirtas at the end of 2014, visited Moscow) and by this people's representatives' desire to broaden cultural autonomy rights through a variety of mechanisms of expression of will, including by analogy with the “Crimean scenario.”

On the other hand, in the formation of a loyal attitude to Russia an important role is played by the active work of public media organizations, special services and controlled by them structures in the sphere of propaganda, systematic and long-term work with the staff, target groups in the political community, scientific community and media (including Turkish citizens' receiving education in educational institutions of the Russian Federation, their being invited to participate in conferences, research programs) that receive financial and material support.

A striking example of the effectiveness of the work of Russians in the Turkish direction is the pre-election statement of one of the candidates for parliament by the Peoples’ Democratic Party M. Ocana (graduated from a university in the Russian Federation). He demanded to recognize the results of the “referendum” in the Crimea, because, in his opinion, such a form of expression of the will of the population is a manifestation of democracy. He also pointed out that “the problems between Russia and Ukraine must be solved without the intervention of third countries responsible for the Ukrainian crisis.”

Such Turkish tactics in political and economic contacts with the Russian Federation presupposes a rational pressure on the Kremlin, in particular, manipulating the readiness to slowdown the two-way dialogue. Thus, it was on the initiative of the Turkish side that in May the meeting of the Turkish-Russian strategic planning group, chaired by the Ministers of Foreign Affairs of the two countries, was postponed until after presidential elections. The practice of regular telephone contacts between P. Erdogan and V. Putin has also been suspended. In addition, Ankara has resorted to demarches designed to demonstrate its arguable concern about the situation of the Crimean Tatars in the Crimea.

Some artificial “cooling” of relations with Russia was also demonstrated by R. Erdogan's negative reaction to a very painful for a part of the Turkish political elite Putin's participation in the events to commemorate the Armenian Genocide victims, which were held in Yerevan April 24, 2015.

Also, Ankara cannot help responding to the planned by Moscow active deployment of powerful enough military grouping and modernization of the Black Sea Fleet in the annexed Crimea, including surface ships, submarines and aircrafts. This is a serious challenge, which Turkey cannot afford to ignore both at the national level and at the level of NATO. According to the leadership of the EU and NATO, the current Russian military forces in the Black Sea region could become striking ones, the vector of direction of which is the Middle East, the Balkans and Central Europe.

Despite the fact that Turkey has not joined the Western economic sanctions against the Russian Federation, this year there are tendencies for further reductions in bilateral trade. According to the Turkish Exporters Union, Turkey's exports to Russia in the first quarter of this year decreased by 34.8 % (last year the decline made 14.6 %), especially in the important for Turkey export-oriented sectors such as automotive and textile industry (minus 55 % and 43 %, respectively), due to the devaluation of the Russian ruble and falling purchasing power of the population. At the same time, Turkish producers of fruits and vegetables constantly complain about their being nagged during inspections of goods at the border by representatives of the “famous” “Rosselkhoznadzor” that they believe is provoked by lobbying activities of Russian market operators.

This has led to an increase in prices of the “associated with Russia” products at Turkey's domestic market, which has negatively affected the increase in the level of consumer inflation, and reduced production in the agricultural sector.

A significant reduction is expected in the flow of tourists from Russia to Turkey (the decline in the first quarter of this year amounted to 47 %), which will significantly reduce the revenues in selling souvenirs, textiles, leather and so on. In order to partially neutralize such risks, the Turkish side has decided to take on some of the costs of the Russian tourist operators (payment for aviation fuel, refueling vehicles for the transfer, the service at the airport), having made calculations in the Turkish currency.

However, the possible signing of an agreement on trade and economic partnership in the sphere of ​​services and investments (the Russian side is ready to sign it before the end of 2015), without taking into account the point “trade in goods”, will not be able to bring the Turkish-Russian economic cooperation to a qualitatively new level, since the purchase of hydrocarbons from the Russian Federation is Turkey's main imports — 70 %.

Since the political and economic sanctions of the West against Russia have been continued, then because of its domestic financial and economic problems, it will be difficult for Moscow to finance its announced projects in Turkey. Besides, by the level of the investments into the Turkish economy, Russia by the beginning of this year remained in the seventh place (56 billion US dollars), significantly behind the United States (337 billion US dollars), Hong Kong (150 billion US dollars), China (116 billion US dollars) and other investors.

Under such circumstances, neither Ankara nor Moscow is in a hurry with the consensus in strategic matters, setting aside their consideration and limited with only minor concessions. In particular, the Russian side points out that for the full transition to settlements in national currencies it is necessary to solve the problem of fluctuations in the exchange rate of ruble and lira, as well as to create special investment funds, which will simplify the procedure for the use of national currency.


The pipeline “The Turkish Stream”

Based on its real possibilities, Ankara essentially focuses on the issue of Moscow's gas discounts as a concession for the right to lay the pipeline “The Turkish Stream” on the territory of Turkey. However, the Russian side has ignored Ankara's demands and is trying to put to one side the consideration of this matter. In its turn, Turkey, against the background of Western sanctions towards Moscow, and low liquidity products of the “Gazprom”, begins to question Russia's ability to pay for the project. Besides, it is difficult for the Russians now to find partners in Europe for the project “The Turkish Stream”, in particular, because Brussels is not satisfied with the terms of its construction without an intergovernmental permission. This gives an additional negative coloring to the Russian-Turkish cooperation within the framework of this gas pipeline.

What is the West's reaction to the current Turkish-Russian relations? First of all, we should point out that Ankara, manipulating the factor of “rapprochement with the Russian Federation”, has managed to make an agreement with the European Union on restarting the update process of the conditions and the content of the bilateral (Turkey-EU) agreement on the customs union. Besides, the European Commission has promised to inform the Turkish side on the negotiations on the establishment of the Transatlantic Trade and Investment Partnership between the EU and the USA (the so-called “free trade area between the EU and the United States,” which also described as an “economic NATO”), and to support Turkey's joining the final agreement.

In case of implementation of the relevant plans, Ankara will be able to count on more favorable conditions of its activities on the European market. This should provide a qualitative and quantitative increase in the level of Turkish-EU economic and trade relations, strengthen the integration of Turkey with the EU and improve the prospects for the country's full membership in the European Union.

Today, the US government and the European Union will try to refrain from actions that may adversely affect the quite shaky political situation in Turkey in the situation of relatively conflict-free completion of the electoral campaign.

This position of Brussels and Washington could be explained by their desire to eliminate the appearance of additional grounds for strengthening of the projected cooperation in the post-election period between Turkish and Russian ruling circles that are trying to explain the deterioration of the political situation in Turkey and Russia by some “conspiracy” between the countries of the West aimed at overthrowing/easing of V. Putin and R. Erdogan's regimes.

The expected “immersion” of the Turkish political elite into the processes of solving first of domestic issues will significantly reduce Ankara's activity in the context of development of the Ukrainian-Turkish political and economic dialogues, leaving mainly the problems of the Crimean Tatars in the focus of Turkey's attention.