COMMENT: Turkey moves closer to Russia, but is immune to Western sanctions

COMMENT: Turkey moves closer to Russia, but is immune to Western sanctions
Turkish President Recep Tayyip Erdogan and Russian President Vladimir Putin have built up a good working relationship based on self-interest. Turkey wants to increase its geopolitical influence and Putin needs to source now the goods that have been sanctioned by the West. / bne IntelliNews
By Denis Cenusa in Germany August 17, 2022

Since the Russian military aggression has plagued Ukraine's territorial integrity, stability and security, Turkey has been adjusting its interests and position towards each side accordingly. Ukraine apparently found a reliable partner in Turkey, which provided military support and a diplomatic platform for negotiations with the Russians. Even more pronounced due to the ongoing war in Ukraine, Turkey's balanced foreign policy proved helpful in maintaining engagement with both Ukraine and Russia.

Ankara is fully aware that a balanced position generates a wide range of geopolitical and geoeconomic privileges. First, Turkey refreshes its international reputation damaged by frequent episodes of repression against the opposition, critical media, disloyal civil society organisations and secessionist ethnic minorities.

Second, given Russia's isolation from Western markets through sanctions, Ankara is able to take advantage of Russia's domestic market from which more than 1,000 Western companies have fully or partially exited. Turkey's export-oriented economy needs new markets to stabilise the national currency and ease social tensions, and with the popularity of the regime.

Third, its non-alignment with the sanction’s regime opens the door for the Kremlin, which needs allies in the region and is willing to make mutually beneficial concessions. This also includes Russia's willingness to contribute to Turkey's increased geopolitical role in the emerging international order.

Last but not least, as it draws closer to Russia, Turkey has several levers at its disposal to protect itself against Western "secondary sanctions". Ankara is currently blocking Finland and Sweden from becoming Nato members. In addition, it can open its doors to the 3.7mn Syrian refugees who aspire to reach Europe and who have been welcomed by Turkey since the 2015 migration crisis. In these circumstances, at least in the short term, Turkish President Recep Tayyip Erdogan has an advantage in relations with Russia, which is struggling to adjust to limited access to foreign markets. The Turkish position became a challenge in the western field, playing a determining role in the enlargement of Nato and the "Istanbul grain deal” on July 22  that makes possible Ukraine's grain shipments by sea.

Turkey – a useful partner for Ukraine and its allies

Turkey's prompt assistance to Ukraine was instrumental in the early victories of the Ukrainian side against the Russian invasion. From a military point of view, the delivery of the Turkish Bayraktar UAV to Ukraine helped to slow down the Russian advance, generating incalculable losses in both weapons and human resources. In August, Ukraine signed an agreement with Turkey to allow local production of hardware and software components for Bayraktar.

In the political sphere, Recep Erdogan has offered Turkey as a mediator between Moscow and Kyiv for a military ceasefire agreement. Negotiation attempts were unsuccessful due to Ukraine's justified mistrust of Russia, which seeks to dismantle its smaller neighbour. Negotiations have reached an impasse after Ukrainian forces revealed egregious violations by Russian soldiers against civilians in Bucha and other parts of Ukraine that closely resemble war crimes.

Ukraine's success on the battlefield and access to Western military weapons made Turkish diplomatic efforts to reach a ceasefire truce irrelevant. In any case, Turkey managed to negotiate a global grain agreement between Ukraine and Russia on a UN platform. It made possible a safe export of grain from Ukraine to foreign markets. The maritime unblocking of the shipment of wheat, corn, sunflower seeds, etc. traditionally exported by Ukrainian producers has a positive impact on the humanitarian situation in the Global South.

Assisting Ukrainian ships to depart with commercial food from three (Odesa, Chernomorsk and Yuzhny) of the six ports on the Black Sea coast that remained under Kyiv's control increased Turkey's geopolitical weight, at least during the Russian war against Ukraine. The monitoring of the implementation of Ukrainian grain shipments, carried out by the Istanbul-based Joint Coordination Centre, will maintain Turkey's strategic relevance. The EU and Ukraine understand that Turkish contributions to the restoration of any semblance of past normality are crucial.

“Autocratic solidarity”

Parallel to supporting Ukraine, Turkey has also been showing a circumstantial alliance with Russia. Turkey's no-sanctions policy provoked immediate sympathy in Moscow. Despite not aligning itself with Western sanctions, Ankara did not gain any bold negative fame as did, say, Serbia. Nato and the EU refute the neutral position on sanctioning Russia expressed by a member state and an aspiring country to join the EU, respectively. By opting out from sanctions, the Turks did not face any massive public or political pressure from either from Western or Ukrainian politicians and the public.

Unafraid of consequences due to unique levers in Russia's confrontation with Ukraine, Erdogan sided with Putin at least one time. He shamed German Foreign Minister Annalena Baerbock for disrespecting the Russian president. However, no massive backlash came from the West against Erdogan's situation comparable to the blame received by Emmanuel Macron, who expressed concern about "humiliating" Putin. Perhaps, Erdogan is showing a critical attitude against those who condemn Putin not only because of a kind of personal intolerance. This also seems like a sign of “autocratic solidarity” as the West joins forces to protect the international liberal order.

Circumstantial alliance with commercial interest

In addition to the political closeness, what stands out are the burgeoning economic ties between the two countries. While Russia needs technologically advanced markets that can substitute restricted exports from the West, Turkey is in a strategic position to seize the economic opportunities. In fact, it can choose how extensive it wants economic ties with Russia to develop, avoiding risky interdependencies. The reality is of such nature that Turkish exports are badly needed to mitigate scarce Russian imports and buy some time to develop localised production and import substitution capabilities. By investing in greater Turkish geopolitical prominence, Moscow is increasing its southern neighbour's immunity from secondary Western sanctions. Consequently, Turkey is taking higher risks by using more individualistic approaches towards Russia, without consulting them with the West.

The Sochi meeting between Erdogan and Putin in early August showed the readiness for some fundamental changes.

First, Turkey agreed to pay for Russian gas partly in rubles. This favours a higher demand for rubles and accelerates de-dollarization, which would reduce Russia's vulnerabilities under the sanction’s regime.

Second, the two allies want to increase bilateral trade to $100bn, putting Turkish trade turnover on a par with that of China, Russia’s biggest single trade partner. It could lead to a boom in Turkish goods and services on the Russian market and an increase in energy resources sold by Russia at a political discount. Still, oil is what can be shipped in larger volumes because the capacities of the existing pipelines, "Turkish Stream" and "Blue Stream", are limited to 31.5bn and 16bn cubic meters respectively. No intention to develop new pipelines on the bottom of the Black Sea has been announced so far.

Third, their central banks are in close coordination, suggesting that Russia could try to convince Ankara to set up an integrated payment system to replace the need for SWIFT, from which most Russian banks were cut off due to sanctions. The integration of national payment systems remains a difficult goal to achieve and even Russia's main partners decided to stay out - China and India.

Russia, for its part, rejoices in minor successes in the banking field. Five Turkish banks are making regulatory adjustments preparing the ground for the use of the Russian international bank payment card "MIR". Such a measure will simplify Russian tourism affected by the withdrawal of Visa and MasterCard. It may also facilitate the relocation of Russian elites from Europe to Turkey, which has become one of the most attractive destinations available to Russian citizens "fleeing" Europe due to the application of sanctions.

The closeness between the two countries, the Turkish technological potential and the perceived immunity on secondary sanctions, converts Turkey into a valuable partner in the Russian strategic energy project too. Thus, in August, it was announced that Turkish Karpowership would be joining the second LNG project in the Arctic to provide Russia with floating power plants to support the construction operations. The Turkish side did not officially confirm this step, but the company has experience of working in countries that are under sanctions regime (Cuba, Sudan or Guinea-Bissau), way less restrictive than those applied on Russia.

As long as Russia's war against Ukraine continues, Turkey wants to play a central role in the negotiations between the two warring parties. In the traditions of realpolitik, Erdogan understands that the West has refrained from even pointing out the risks of imposing sanctions on Turkey. This incentivizes the Turkish leader to confidently provide Russia with avenues to ease the pressure of trade restrictions and gain access to some of the necessary technology. Turkey is taking every opportunity to increase its geopolitical relevance. By becoming indispensable to the West on various Ukraine-related issues, Turkey gains a kind of immunity to absorb the risks of sanctions. Moscow relies on the partnership with Turkey to adapt to the international isolation with which the West punishes it for the aggression against Ukraine.


Denis Cenusa is an Associated Expert at Think Tank EESC in Lithuania and Moldova, and a PhD candidate at Justus-Liebig-Universität in Germany. He tweets @DionisCenusa