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Turkiye and Balancing East- West Trade Routes
by Dr. Ali Oğuz Diriöz
Turkiye needs to balance several alternative trade routes, both from an economic perspective but also for politically positioning itself between East and West. Over the last decade there has been an important trend in the development of the global economy, where faster growing economies are in the Indo-Pacific region (most notably, India, China and Southeast Asian nations). The last decade has also been marked on one hand by attempts to revive the ancient Silk Road and land trade over the Eurasian landmass. Notably the Belt and Road Initiative has been a major project of trade corridors both over land and sea that connects the ‘East-West’ trade (Alkin, 2023). Alternatively, there has been options for other routes to connect the ‘East-West’ trade, notably the newly proposed India-Middle East- Europe Corridor – IMEC (Announced at the G20 Summit in New Delhi in September 2023) (Duyar, 2023), but also a Polar Silk Road ; High North over navigation through the North Pole as melting ice due to the ‘Global Boiling Age’ makes the area potentially more suitable for commercial navigation (Hill, et.al. 2015 ; Çevik & Durukan, 2020). Turkiye has been a champion of the Middle Corridor (a trans-Caspian initiative to connect to Central Asia and Asia in general) and also more recently the Arab Development Road from the Turkish border in Northern Iraq through Basra. Many of these projects are aimed at connecting the trade and logistical routes, but tend to be presented as competing alternatives. In reality, they are actually complementary to one another since in the event of a disruption, all these alternatives would be necessary in order to not have major disruptions in global trade and supply chains.
This article makes a brief analysis comparing the different trade routes of the East-West Trade (modern Silk Roads) and their implications for Turkiye. More importantly, many past works have focused on Turkiye’s role between Europe on one hand as the main destination and China as the main producer. Such analyses have overlooked India as the other big trade partner to further cooperation. Finally, this article also suggests that Turkiye should also have an institutional basis of cooperation (such as the Organization of Turkic States – OTS) in order to develop the Middle Corridor and also be included in various other trade routes, most notably the Belt and Road Initiative (BRI) by China, and the India-Middle East- Europe Corridor – IMEC (Announced at the G20 Summit in New Delhi in September 2023). Turkiye’s argument is that it is difficult and not necessarily advantageous to by-pass Turkiye in such corridor trade routes, but rather to increase interconnectedness and develop Turkiye’s natural potential as a center of these various trade route initiatives. In this respect, Turkiye and other OTS states should consider also inviting guest participants to their meetings, as partners in regional and global trade. For instance; Georgia, Tajikistan, Finland, and India need to be invited more frequently as ‘guests’ if not observers. Of course in addition to nations, International Organizations (IO’s) and Regional International Organizations (RIO’s) such as the African Union – AU, The European Union – EU , The Association of South East Asian Nations – ASEAN , The Shanghai Cooperation Organization – SCO , The Black Sea Economic Cooperation – BSEC, The Gulf Cooperation Council – GCC, as well as the Organization of Islamic Cooperation – OIC, should be invited depending on the occasions and as guests to OTS summits and meetings.
Turkiye is in the G20 group but not in the G7 (group of Western developed states including United States, Canada, United Kingdom, France, Germany, Japan and Italy), nor in the BRICS group ; which was until recently Brazil, Russia, India, China and South Africa, but now will also include Argentina, Ethiopia, Iran, United Arab Emirates, Saudi Arabia, and Egypt as of August 2023 (Alcini, 2023). Turkiye should not be excluded from neither the G7 nor BRICS as they constitute most of the G20 group (G20 includes BRICS and G7 in addition to Indonesia, Turkiye, the European Union – EU and the African Union – AU as of September 2023).
Increasingly one can observe a division between BRICS and particularly China, Russia and Iran, which promote the Belt and Road Initiative – BRI. On the other hand, the G7 and India were champions of the IMEC corridor, which didn’t originally include Turkiye. Specifically Turkiye should adopt a balanced approach to the BRICS and G7, in a way like India. And in so doing, Turkiye should also promote further its cooperation and relations with India, which is part of BRICS but in good standing with Western G7 States as well as itself being the most populated nation now. The opportunities regarding the rise of India economically over the next decade should not be a ‘missed opportunity’ for Turkish Foreign Policy, as Turkiye also tries to balance and gain the trust of both the East and West, as well as the developing Global South (India traditionally an influential role in the Global South since its independence). Though Singapore is small nation, like India and Türkiye, they have an interest in developing several trade route options. Like Turkiye and India, Singapore is also trying to balance East and West and also is an important global hub for world trade and prioritizes several alternative corridors and routes which can be each used to relieve global trade and logistics.
Due to its geopolitical location, Turkey is in an advantageous position for trade, international logistics and energy projects. In addition to cooperation, competition has also emerged for these opportunities in the Eurasian main continent and the Black Sea and Caspian basins. Especially in Central Asia, the rivalry for access to and control of the area is called the “Great Game” or the “New Great Game” concerning the current rivalry in the 21st century. The name is originally referring to the geopolitical rivalry between the Russian and British empires in the 19th century, and is called the “New Great Game” (Esceli, 2021). It is possible to consider the geopolitical and political economic competition, especially regarding the access of independent states in Central Asia and various developing Asian states to international markets, within the framework of the “New Great Game.”
Following the BRICS meeting in August 2023, the G20 meeting held in India in 2023 (Diriöz, 2023), and the G7 Meeting in Japan in 2023, maps regarding different trade routes were on the agendas. It was particularly noteworthy that Turkiye was not included in the IMEC map put forward at the G20 meeting, but since the eruption of the war between Israel and Hamas since 7 October 2023, the stability of the Middle East and hence the trajectory of the IMEC corridor remains uncertain. Turkiye had stated immediately upon IMEC’s announcement that that it was difficult to establish a trade route in the region without including Turkiye.
Countries, but also cities and metropolises where important industries and ports are located, are competing to attract investments as part of becoming hubs and centers in context of these new trade routes. Thus, each wants to increase the prosperity of their citizens and promote economic growth by attracting investments, investors and multinational companies. While they are competing with each other to attract investments and routes, on the other hand, many prudent decision makers are simultaneously encouraging alternative routes, as they are aware that serious problems will occur if international supply chains are disrupted. The most concrete example of this is the partial closure of the Suez Canal due to a single ship’s accident (The Ever Given), causing significant disruption to all international trade and shipping. Especially since the last decade of the 20th century, that is, since the end of the Cold War, Turkiye has been looking for ways to increase its political, economic and geopolitical, that is, geo-economic presence in the region, concretely, such as with the Baku Tbilisi and Ceyhan project, and institutionally, with the formation of the Black Sea Economic Cooperation Organization. Today, especially the Turkish States Organization – OTS has transformed into a full-fledged international organization and within the framework of institutional structures, the Central Asian republics, which are on the new Silk Road route and have a relatively low population despite having a significant surface area. Through the OTS, Turkiye and the region can institutionally connect with international markets more transparently and more effectively.
With the Turkish States Organization, It is possible to have institutional mechanisms of cooperation over the New Silk Road, and also to balance both BRI and IMEC, which are effectively two competing projects (Başaran, 2023). Turkiye can use this opportunity to also develop alternative trajectories through the Trans-Caspian Middle Corridor. Both the Shanghai Cooperation Organization and the BRICS group of countries are platforms where there is also an increasingly evident rivalry between India and China. In this context, it is recommended that Turkiye should not only attach importance to good relations with China within the scope of the BRI project, but also develop its relations with India, and not miss on the opportunity of a rapidly growing India. Turkiye also shares common institutional rule of law and democratic values with India, which can be also basis of institutionally developing solid economic cooperation.
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