By Gurur Altun
Already fraught since Russia added its support to the Assad regime in Syria, relations between Turkey and Russia took a turn for the worse after the Russian bombing of a hospital in Idlib, Iraq on May 31st. Theses increasing tensions are adding strain to Turkey’s already slowing economy.
Turkey accused Russia of targeting civilians in the recent bombing, though it is unconfirmed whether it was a Russian or regime-led attack.
Russian Minister of Foreign Affairs denied the attack on a civilian target and in turn accused Turkey of violating Iraqi sovereignty by deploying troops in order to realize expansionist aspirations for oil fields in the future; of violating Iraqi airspace; and of attacking Kurdish forces involved in the fight against IS.
The Kurds have long been a sticking point in the two countries’ dealings since Soviet support for Kurdish movements in Turkey and Syria during the Cold War. Early rapprochement between the two regional leaders under the AKP has been deteriorating since the onset of the Syrian civil war, and has come to crisis point at various stages of the conflict.
New President, mixed messages
One of Binali Yıldırım’s promises as Turkey’s newest Prime Minister has been to promote positive international relations and to work on relieving bad relations. In line with this, Turkey’s Minister of Foreign Affairs, Mevlut Çavuşoğlu, proposed on May 30th to establish a commission of both Turkish and Russian diplomats dedicated to improving bilateral relations.
That same day however, Erdoğan demanded an official apology from Russia after the downing of a Turkish Army helicopter by the PKK using allegedly-Russian missile systems. In turn, Russia demanded proof for Erdoğan’s claim and blamed Turkey for supporting IS.
State Duma deputy, Leonid Kalashnikov, demanded an apology and compensation for the jet shot down in Turkish airspace last year as prerequisites for any work to improve relations between the two countries.
In a statement last week, Erdoğan claimed to not understand Russia’s demand for Turkey to take the “first step” in improving bilateral relations after Turkey shot down the Russian jet, arguing that it was effectively a misunderstanding. In comparison to previous finger-pointing, Erdoğan’s tone was almost reconciliatory. Given the effect of poor relations with Russia on the Turkish economy, this begins to make sense.
Where does Turkey stand?
The Russian economy was hard-hit by 2015’s falling commodity prices. In spite of this, Russia imposed harsh restrictions on trade with Turkey, going so far as to practically forbid tourism to Turkey. Just last week, 23 Russian tour operators were closed for promoting tours to Turkey.
The contribution of this sector to Turkey’s economy was approximately USD35 billion in 2015, and the loss of Russian revenue is causing significant losses to the Turkish tourism industry.
Furthermore, there are several Turkish companies operating in Russia, focused in construction and retail. These companies are being decimated due to the impact of global economic downturn and the seemingly ever-deteriorating relations between to two countries.
Despite its ban on Turkish agricultural products, inflation in Russian food prices shrank significantly from the end of 2015 and into 2016. Thus, while the outlook for both economies is not positive, Turkey seems more affected by tensions, with warnings of vulnerable economic growth in the coming years. While Russia is not solely responsible for Turkey’s poor luck, the tension between the two countries has arguably had a significant effect on the Turkish economy.
Turkey is having to fight for international legitimacy on numerous fronts; their relations with Russia, the influx of Syrian refugees, relations with the EU, and the Zarrab case in US are but a few examples. Easing relations with Russia would alleviate some of the pressure on Turkey, but given the increasingly entangled nature of each country’s involvement in Syria, and the fact that neither has leadership known for diplomacy in times of tension, the prospect of easing looks increasingly unlikely.
Additional reporting by Hannah Walton.