Iran-Turkey trade jumps again

Article Highlights

  • While Turkey is a NATO member, EU aspirant, and US ally, it has also sought to bolster its trade relationship with Iran.

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  • Turkey’s trade with Iran has increased from $1.25b to over $20b

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  • Booming trade suggests Ankara and Tehran compartmentalize difficulties while advancing economic relationship

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Sanctions have become a central component of U.S. efforts to coerce the Islamic Republic into conformity with United Nations Security Council resolutions and its Safeguards Agreement with the International Atomic Energy Agency. While Turkey is a NATO member, a European Union aspirant, and an ally of the United States, it has also sought to bolster its trade relationship with Iran.

Turkey’s trade with Iran has increased from $1.25 billion in 2002, the year Turkey’s Justice and Development Party (AKP) came to power, to over $20 billion a decade later, according to statistics included in the italicized article below. According to the Turkish Ministry of Foreign Affairs, Turkish exports to Iran focus on machinery, iron and steel, and tobacco. Ninety percent of Turkish imports from Iran are crude oil and natural gas. This places Turkey as Iran’s fifth largest customer of its gas and oil. The increased Turkish imports of Iranian gas and oil come despite an October 2012 explosion in the pipeline, which disrupted the trade; thus, bilateral trade could theoretically have been even higher.

While there has been sectarian tension between Turkey and Iran, especially with the two countries being on opposite sides of the Syrian conflict and holding opposing assessments of Prime Minister Nuri al-Maliki’s government in Iraq, the booming trade suggests that both Ankara and Tehran seek to compartmentalize their difficulties while they advance their relationship in other spheres.

Iran increasingly depends upon Turkey to alleviate pressure from sanctions. In the first nine months of 2012 Turkey swapped approximately $7 billion in gold with Iran in exchange for oil and gas. The gold trade allows Iran to avoid sanctions on dollar transactions.

At a 30 January 2013 audience with outgoing Iranian ambassador Bahman Hosseinpour, Turkish President Abdullah Gül called for further strengthening of the two neighbors’ bilateral relationship and cited Turkey’s efforts to resolve disputes regarding Iran’s uranium enrichment. Indeed, at the time when the United States and European Union was trying to amplify pressure on Iran, Prime Minister Recep Tayyip Erdoğan argued that concern regarding Iran’s intentions were misguided.

Shortly after Hosseinpour’s audience and remarks, Tabriz University Chancellor Parviz Ajideh announced that Iran and Turkey would open a joint university in the Eastern Turkish city of Van. Because the new university will emphasize engineering and the sciences, it may provide a venue for Iranian students to study fields relevant to Iran’s missile and nuclear programs in laboratories not limited by sanctions prohibitions.

While hardline Iranian officials harshly criticize Turkey for allowing NATO to base an anti-ballistic missile radar system on Turkish territory, the sum of relations between the two countries remains on the upswing. With trade increasing by more than an order of magnitude over the past decade, and Iranian authorities seeking to increase it by another $10 billion, the growing partnership between Tehran and Ankara may soon have an immediate impact on U.S. policy. After all, until Erdoğan’s rise to power, American policymakers could take Turkish support for granted. Turkey was one of only two NATO countries to border the Soviet Union, and Turks fought alongside Americans in the Korean War, suffering the third greatest number of casualties among allied forces after the South Koreans and Americans. While Turks and Americans did not always agree, the two countries stood united against terrorism and together in pursuit of Middle East peace.

Disputes over Operation Iraqi Freedom might have been only a hiccup, but the surprise Turkish decision not to support the transit of U.S. troops or participate in a broader coalition marked only the beginning of a series of disputes which undercut U.S.-Turkish relations. In recent years, Turkey has both broken with the United States and other Quartet Partners by embracing Hamas and moved to undercut Western efforts to coerce Iran into abandoning its nuclear program. While Turkey agreed to host a NATO anti-missile radar system, its cooperation is less than absolute. Foreign Minister Ahmet Davutoğlu has said Turkey’s agreement to host the radar would expire after two years, and that Turkey reserved the right to annul the agreement at any time.

Turkey may be a NATO member, but if its leadership decides to balance relations between Tehran and Washington much as do other states in the region, then the Islamic Republic might consider its outreach to Turkey successful.

 

The Ambassador of the Islamic Republic of Iran [to Turkey, Bahman Hosseinpour], referring to the extensive exchange of official delegations and to the significant increase in trade relations between Tehran and Ankara to upwards of $20 billion in 2012, said, “Iran and Turkey are friends and brothers, and enjoy good neighborliness, friendship, and understanding….”

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