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Monday, October 24, 2016

Turkey will be extremely difficult to restore relations with Russia on the same level

The establishment of political relations of Russia and Turkey raised the question of the restoration of the destroyed economic relations between the two countries. As soon as Russia will return Turkish construction companies and Turkish tomatoes, and Russian tourists on the beaches of Antalya coast? This is unlikely to happen quickly, and there are a lot of reasons.

After the apology, Erdogan shot down a Russian bomber, a chance for the restoration of economic ties between the two countries. We are talking about the resuscitation of the project “Turkish stream”, NPP “Akkuyu” on the lifting of restrictions on Turkish imports (including fruits) and the work of Turkish construction workers in Russia, as well as the recovery of the Russian tourist flow on the Antalya coast.

“Sign of the willingness of the Turkish side to return to the good-neighborly relations not only in words but also in deeds will become resuscitation is the first line of Turkish stream

“Turkish stream” and NPP “Akkuyu”

Gazprom said he is open to dialogue with Turkey on the implementation of the project of construction of gas pipeline “Turkish stream across the Black sea, however, as before. “We have always been open to dialogue on “Turkish stream” open now”, – said the representative of Gazprom Sergei Kupriyanov.

Russia had never refused a pipeline to supply gas to Southeast Europe and the Balkans. And it may be like the “South stream” (through Bulgaria), and “Turkish stream” in a new form (“Poseidon”). In early June, President Putin said that Russia remains faithful to the idea of building a gas pipeline across the Black sea to Europe – a decision on project implementation remains with the Commission.

However, rapid resuscitation of the “Turkish stream” is not to be expected, said the Director of ANO “Centre for policy analysis and strategic studies Yevgeny Gnomedo. “The fact that he passed a long period of time. Construction stopped, the pipe is redirected to the Nord stream – 2″, a contract with Italian contractor Saipem S. p.A responsible for laying the offshore section terminated”, – said the expert. Besides, to build the “Turkish stream” was planned with Russian money, and the situation on the gas market (which is dependent on oil prices) have seriously changed.

“In the industry, including Gazprom, due to a sharp reduction in the cost of products forced to cut funding of investment programs. And it may seriously complicate the situation as of today in active phase are at least two major projects – “the Power of Siberia and Nord stream – 2”, – said Eugene Gnomedo.

However, as is well known, “the Turkish stream is not competitor of Nord stream, the two tubes complement each other. Southern pipe sharpened on the supply to South-Eastern Europe and the Balkans, and the North for supplies to Central Europe.

However, Russia has an opportunity to conclude a new contract for the “Turkish stream” on more favorable terms. Previously, for example, his signing was tied to the discount on Russian gas supplies and Turkey.

“Russia needs to seize the moment and conclude a contract on the most favorable terms, given the compensation for incurred costs and lost profit associated with the actual suspension of the project. There are all the necessary conditions, as Turkey is not in the best situation from the point of view of economic development, and security, and building international cooperation. Ankara is ready to make concessions, and our task is to effectively take advantage of it”, – said Eugene Gnomedo.

This project is beneficial to both parties. Turkey currently receives about 14 billion cubic meters of Russian gas via the TRANS-Balkan pipeline running through Ukraine and Romania. But in 2020 the transit contract between Ukraine and Russia is terminated, and a new unlikely to be signed. The first line of the “Turkish stream” just had to get volumes in transit through Ukraine. Turkey without Russian gas would be difficult to manage even with the TANAP pipeline from Azerbaijan. The Azeris promised only 6 billion cubic meters of gas and the first deliveries not earlier than 2018-2019.

It is not excluded that the full restoration of relations of Russia with Turkey and the lifting of all restrictions will be tied to the signing of a binding contract on “Turkish stream”.

“Sign of the willingness of the Turkish side to return to the good-neighborly relations will become resuscitation is the first line of Turkish stream. Ankara in this issue can go on price concessions” – I agree Stanislaw Werner, Vice President of IFC Financial Center.

After complications of relations of Russia has frozen the construction of NPP “Akkuyu” in Turkey. And Moscow as a whole that was even on hand. NPP more beneficial to Turkey, whereas Russia, which assumed all the costs of construction and maintenance, risk for more than 20 years to recoup their investments. Not to mention the fact that in this case, the Russian Federation created its own competitor to gas in the Turkish market. The fact is that Ankara now gas is consumed for electricity generation at its thermal power plants. However, the generation of electricity at nuclear power plants is significantly cheaper. The Turkish government has repeatedly said that it cost to build a nuclear power plant. If the country has a nuclear energy 10 years ago, she would have saved $ 14 billion on the purchase of natural gas.

On the restoration of the NPP project, the Russian side has not yet spoken. And the chances of its resumption look minimal. This project was possible only under conditions of very friendly relations between the partners. But to return to the previous degree of relationship after seven months of quarreling Ankara.


Deputy Prime Minister Dmitry Kozak does not rule out the resumption of Russian tourists to Turkey and the lifting of restrictions on the work of Turkish construction companies. “Anything can happen”, – he answered the corresponding question, reports TASS.

“For Crimea, the improvement of relations with Turkey may even be on hand, despite the fact that you have to “give” the part the tourists back”

Recall that regular flights with Russia, Turkey did not stop, and to visit the country without problems. But Russian tourists in the bulk went to rest in the country on a Charter flight within the packages, and the sale of tours to Turkey were stopped in November 2015. As a result, Turkey faced a maximum level of decline in tourist arrivals since 1999. First, expecting that the tourism industry of Turkey due to the downturn of tourist flow from Russia and Europe will miss 8-9 billion dollars, but closer to the summer, it became clear that speech can go about $ 12 billion of losses. VZGLYAD wrote about the failure of the beginning of the summer season in Turkey. Many of the hotels did not open, the beaches are deserted, tens of thousands of Turks lost their jobs.

However, if the CPS will promptly allowed to sell tours in Turkey, Russian tourists still have time to relax there this year, as high season in Antalya lasts until the end of September, said the head of the Association of travel agencies of Tomsk Olga Sevostyanova. On the organization of Charter flights and tour packages to tour operators will take about a month.

But the Russians switched to the direction of Russia – Crimea and the Krasnodar Krai to note the unprecedented influx of tourists, and the unexpected discovery of Turkey for the Russians may harm them.

However, paradoxically, for the Crimea, the improvement of relations with Turkey may even be on hand. “For Crimea, it opens an additional window of opportunity. After all, a significant part of foreign investors showing interest in the Crimea, was from Turkey. Therefore, the normalization of relations between the two countries will help the economic development of the Peninsula,” – said the newspaper LOOK authorized under the President of Russia for entrepreneurs ‘ rights, Chairman of the Party of growth Boris Titov.

However, the fear to harm the flow of tourists to the Russian resorts can be one of the reasons why the Russian government will not rush with the return of tourist traffic to Turkey. On the other hand, many Russians already plan their holidays. “Yes, and many Russian tourists will scare away the adverse from the point of view of the security situation in Turkey. These considerations will be used by domestic regulators, explaining the delay in the lifting of the ban on flights, if you really follow the normalization of relations”, – said Vice-President of IFC Financial Center Stanislaw Werner.

Russia banned the import of Turkey a number of vegetables, fruits and berries. For example, to the rupture of relations, Turkey was the main supplier of tomatoes to Russia. The situation was similar and tangerines and grapes. However, the deficit of fruits and vegetables in Russian stores is not observed. Retail outlets was able to find a replacement for Turkish products. Won on the troubles of Turkish agricultural suppliers from Azerbaijan, Armenia and Morocco. The return of the Turkish products to the Russian market for consumers can be a great advantage – the appearance of “excess” amounts of fruits and vegetables, should bring down prices in stores.

“In agriculture, in the context of a well-reaching import ban on imports of fruits and vegetables can be removed only when exhausted the stocks of domestic products. It is possible that the barriers to market entry will be removed gradually, while the Turks will have to compete for already occupied a place on the shelf with the products of the more “friendly” countries,” notes Werner.


Russia has caused serious damage to Turkey also a ban from 1 January 2016 for a number of Turkish companies for the construction of various objects in Russia. The Turkish turnover of developers in Russia, is estimated to reach 50 billion roubles per year.

However, did all of this with minimum damage to themselves. Moscow imposed the exclusion for a number of large Turkish companies, who at this time were major building works in Russia. For example, the ban did not affect the company Enka, which reconstructed the building of the state Duma, the companies Odak Group (erected the mosque Kul-Sharif in Kazan) and Renaissance Construction, who built the office for Gazprom in St. Petersburg.

In the case of warming bilateral relations and the political decisions that Russia may reconsider restrictions on the work of Turkish construction companies, said the Minister of construction and housing and utilities Mikhail Men. “It depends on the political situation. If we will receive such policies, of course, we will revise our relationship with the work of Turkish construction companies, of course,” said Men.

But to regain share in the Russian construction market the Turks will be very difficult. They can’t count on those contracts, who were forced to give competitors and find new ones in a difficult economic situation and the fall in the construction market is problematic. Turkish construction companies specialized mainly in the construction of commercial property and this sector of the market dropped right now more than others.

It may take years

In General, experts do not believe that Turkey and Russia will quickly restore the old friendly relations and that Moscow is in a hurry with the lifting of restrictions.

“We waited only an official apology seven months later, but the question of compensation for the downed plane. The long resistance of the Turkish authorities, who did not want to admit they were wrong, says that today’s attempts to change the situation caused by their difficult economic situation and not conscientious motives, – said Anastasia Ignatenko of GK Teletrade”. – So I wouldn’t bet on the fact that the relations between Russia and Turkey will be accelerated. A new way of cooperation between the two countries will not be smooth, and Russia will vitreum additional preferences”.

“It is obvious the fact that Ankara goes towards Russia not so much due to delayed awareness of his own wrong, how under pressure of the geopolitical situation and the probability of being in isolation – says the newspaper VIEW first Vice-President of “OPORA Russia” Paul Segal. – Given this, I don’t think the lifting of sanctions against Turkey in the field of trade and sale of frozen projects in the energy sector will be on the agenda in the near future. However, it is possible that some restrictions will be removed, for example in the field of tourism, which corresponds to the interests of the first Russian side, which is now able to conduct a dialogue with Turkey from a position of strength”.

“Improving relations is beneficial to both Russia and Turkey. But don’t expect that magic all simultaneously corrected. Reserve time at our business in these sectors is still there. But what is important is the fact that Turkey is supplying us a lot of spare parts for production, a lot of textile etc. Also, Turkey buys from Russia a large amount of the agricultural products, especially grains. This is one of the countries with which Russia has a positive trade balance. That is, they buy from us more than we have”, – said Boris Titov.

The implementation of Turkey indicated by the Russian side conditions – punish the perpetrators and compensation for the downed Russian su-24 in the skies over Syria – may take a long time. But only after that we can talk about the beginning stages of a real recovery of economic relations between Russia and Turkey. For comparison: from the time that Israel called Turkey’s apology for the incident with “freedom Flotilla” in 2010, Israeli commandos intercepted the vessels which went to break the blockade of the Gaza strip, killing nine Turkish citizens), before the entry into force of the Treaty on the normalization of relations between the two countries has been more than three years. Prime Minister Benjamin Netanyahu apologized to his counterpart for the incident in March 2013.

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