Turkish-Russian normalization to fuel economic relations: Experts

Turkish-Russian normalization to fuel economic relations: Experts

Turkish-Russian normalization to fuel economic relations: Experts


Recent moves to normalize ties between Turkey and Russia will benefit both sides’ economy as well as the region’s economy, particularly in the energy, tourism and trade sectors, according to officials and experts. 

A downturn in relations occasioned by Turkey’s downing of a Russian jet last November especially impacted economic and trade ties.

After roughly nine months of disagreement, Turkish President Recep Tayyip Erdoğan and Russian President Vladimir Putin agreed to revive their stalled bilateral relationship in their first direct contact on June 29, fueling hopes about restoring economic and trade ties. 

Russian Economic Development Minister Alexey Ulyukayev said the trade and investment relations between Turkey and Russia would be rebuilt, according to a TASS report. 

“Trade and investment relations with Turkey will be restored,” he said in an interview with Gazeta.ru, TASS reported July 1. 

An expert from the Energy Markets and Policies Institute (EPPEN) said the improving relations would make the most positive contributions in the energy sector. 

“Russia has heavily invested in Turkey’s energy sector,” said EPPEN’s Volkan Özdemir, as quoted by Anadolu Agency, noting that a possible resolution over gas prices would be significant if both sides can agree.

Nigyar Masumova, an academic from the World Economy Department of Moscow State International Relations University, said the normalization in ties was some good news during difficult days for the both countries.

Trade and tourism ties will return to the former levels in a short time, Masumova said, according to Anadolu Agency, while adding that the planned Turkish Stream project could be delayed due to economic problems in Russia. 

“We believe that the sanctions imposed by Russia on fresh fruit and vegetable imports from Turkey will likely be abolished in the autumn,” she added. 

The head of the Agriculturalists Association of Turkey (TZOB), Şemsi Bayraktar, earlier noted that his sector’s losses had reached $290 million over the year due to the political problems with Russia. 

“Russia’s share in our fresh fruit and vegetable exports was 39 percent on an amount basis and 42 percent on a value basis. The sector’s exports have been negatively affected since sanctions were imposed by Russia on Jan. 1. While Turkey made around $368.2 million in revenue in exchange for around 530,000 tons of fresh fruit and vegetable exports to Russia in the first five months of 2015, this figure plunged to around $78.2 million of revenue for some 113,000 tons of exports,” Bayraktar said in a press meeting on July 1.  

In the first four months of the year, Turkey’s exports to Russia dropped to $484.6 million, a 61.5 percent decrease compared to the same period of 2015.