1. Skip to content
  2. Skip to main menu
  3. Skip to more DW sites

Turkey, Russia partnership essential to both

Sinem Özdemir
August 12, 2022

To the dismay of the West, the Turkish president returned to Ankara from Sochi with pledges of new ties and some modest economic concessions. Could Russia's Vladimir Putin prove to be a true friend in tough times?

Turkish President Recep Tayyip Erdogan shakes Vladimir Putin's hand
Putin (right) and Erdogan met in Sochi for the second time in a monthImage: MURAT KULA/TURKISH PRESIDENTIAL/AFP

Just 17 days after the last Astana summit in Tehran, Turkish President Recep Tayyip Erdogan and his counterpart, Vladimir Putin, met again — this time in Sochi. As Erdogan was underlining that "the world was watching the Sochi summit," the international headlines drew attention to the "secretive nature" of the two leaders' closed-door meeting. 

After four hours of negotiations, an agreement was reached between Putin and Erdogan to expand cooperation in the economic and energy sectors. A joint statement was released following the meeting which expressed "the decisiveness to deepen the ties," while further details of the agreement remained unclear.

Yet, the talk of boosting economic ties was enough to raise eyebrows in the West, which has attempted to put pressure on the Russian economy in the wake of its invasion of Ukraine.

Turkey key to Russia circumventing sanctions?

Daria Isachenko, an expert on Turkey and Russia at the German Institute for International and Security Affairs, wrote that "relations between Turkey and Russia are a puzzle to many in the West." Having experienced periods of turbulence in their complex bilateral relationship over the years, a lack of alternatives seems to have brought Erdogan and Putin on a more even keel — at least in the short term. 

Some observers interpreted last week's meeting in Sochi as a summit of "two economically struggling leaders." Erdogan is looking for a boost to the Turkish economy to recover ahead of the upcoming elections. Putin, on the other hand, is seeking new options to work around Western sanctions.

Despite repeatedly underlining its support for Ukraine's "sovereignty and territorial integrity," Turkey, a NATO member, has not joined Western sanctions against Russia. "Turkey is de facto the only remaining connection of Russia to the West. Therefore, Ankara is highly important to Russia at the moment," Kerim Has, a Moscow-based freelance political analyst on Russian and Eurasian relations, told DW.

Dr. Kerim Has, a man wearing glasses in a library
'Turkey is de facto the only remaining connection of Russia to the West,' said Kerim HasImage: privat

Has pointed out that Russian companies have already been seeking to resume business with Europe via Turkey to bypass the sanctions. "I believe the memorandum signed in Sochi is an agreement which aims to facilitate that mechanism," he said. 

Last March, the Kremlin approved the "parallel import scheme" to remove some consumer goods from the scope of Western sanctions. An article published in the Turkish business daily Dunya suggests this mechanism of "reexporting" has, in the past few months, turned Turkey into a busy transit hub for goods destined for Russia. 

Some Russian companies have even opened offices in Turkey for the initial import of goods procured by Moscow from third countries for subsequent transfer to Russian ports. The Dunya article cited Russian Economic Development Minister Maxim Reshetnikov, who noted that the total volume of products brought into the country within the scope of parallel imports is around $4 billion. 

Should Turkey fear secondary sanctions? 

Following the Sochi meeting, some EU officials expressed concerns about Ankara's pledges to strengthen economic ties with Russia. A senior official told the Financial Times that EU members "could call on their companies and banks to pull out of Turkey, if Erdogan follows through with the intentions he outlined following the summit." 

"Turkey is not a full member of the EU; therefore, politically speaking, Turkey is not obliged to follow EU decisions," Huseyin Bagci, head of the Foreign Policy Institute in Ankara, argued. "If we are talking about a NATO decision, then that is a different matter."

Zaur Gasimov, a specialist in Turkey-Russia relations at Bonn University in Germany, also doubts that Ankara should fear Western sanctions in the short term. In addition to the crucial role Turkey has played as an intermediary between Kyiv and Moscow, the West needs to maintain stable dialogue with Ankara given other recent tensions within Europe, such as those between Serbia and Kosovo, said Gasimov.

Turkey opens center for Ukrainian grain exports

Sinan Ulgen, chairman of EDAM think tank, suggested Turkey remains cautious as it is "looking to take advantage of the vacuum created by the cessation of the trade and investment deals of Western companies in Russia." The ex-Turkish diplomat underlined that Turkey has not welcomed large-scale investments by Russian oligarchs, arguing that "there are no grounds for the EU to impose sanctions on Turkey or Turkish companies at the time." 

Turkey's contribution to the European energy market limited

Putin's televised statement in Sochi, suggesting that Europe should be grateful to Turkey for the uninterrupted stream of gas to their markets, made headlines in the Turkish and European press.

There have been discussions about Turkey's growing role as an alternative energy hub after Russia reduced the amount of gas flowing through the Nord Stream 1 to 20% of capacity. Despite acknowledging the increased importance of the TurkStream amid the gas bottleneck in Europe, analysts suggest the pipeline doesn’t have sufficient capacity to cover the energy needs of the entire region. 

Turkish technicians standing in front of three national flags at the Botas pumping station
Turkey could indeed help the EU in the medium term to diversify its gas supplies away from RussiaImage: picture-alliance/dpa

Has suggested that constructing new pipelines to ship Russian gas to Europe via Turkey is also not an option. "Let's say there is peace eventually, and the West is ready to buy gas from Russia. In that case, there are already enough pipelines for the short term. So, for Russia, there is no point in investing in new pipelines shipping gas to Europe through Turkey," he explained. 

According to Ulgen, Turkey could indeed help the EU in the medium term to diversify its gas supplies away from Russia by becoming a hub for the export of natural gas from Azerbaijan and perhaps Iran, should there be an agreement to maintain the JCPOA nuclear agreement. "This will, however, require the EU to commit itself to conclude long-term purchase agreements with these countries," he said. 

Exchanging gestures and rubles

Erdogan told reporters on his flight from Sochi that they agreed with Putin to trade in rubles, claiming it would financially help both countries. Furthermore, Ankara announced plans to extend the use of MIR, a Russian payment system.

Putin's move to allow Erdogan to pay in rubles, although his countermeasures have paid off and strengthened the Russian currency significantly, has been interpreted as a "gesture" by some economists. Has believes it will be to Turkey's advantage. "Ruble reserves are accumulating in Turkey due to tourism and trade. In that sense, Turkey would benefit from partially paying for Russian gas in rubles without converting this amount to dollars, even if it is not a significant amount."

Timothy Ash, head of the emerging markets team at London-based BlueBay Asset Management, said using rubles in transactions has a very limited effect. Ash evaluated the move as being a "mutual snub" to the West rather than a mutual gesture of goodwill to one another.

"It's more signaling to the West that there are alternatives in how transactions are conducted, and they don't all have to be in dollars and euros," said Ash. 

Edited by: Lucy James