Turkey-Azerbaijan: When the “Little Brother” becomes almost overbearing.

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Created on Wednesday, 15 November 2017 05:55

Geopolitics Standpoint of Turkey   Turkey-Azerbaijan: When the “Little Brother” becomes almost overbearing Can Muşlu

Can Muşlu

Can Muşlu analyzes the new terms of Turkey-Azerbaijan relations beyond the slogan-borne view “One nation with two states” in order to consider the more effective economic integration through infrastructures, trading flows and the circulation of people and ideas.

On the first page of the 31 October 2017 issue of daily newspaper Star (“The Voice of national sovereignty”), under the headline “A civilizational bridge from East to East”, featured no less than three photos of Turkish and Azerbaijani presidents R. T. Erdogan and I. Aliyev, upon the inauguration of the new Kars-Tbilisi-Baku railway line, dubbed “the Railway Silk Road”.

Although three other heads of state were present at the event—of Georgia, Uzbekistan and Kazakhstan—they were hardly visible, hardly more than foils to the two star-presidents. If that ceremonial inauguration presented Turkey's President Erdoğan with yet another opportunity to activate his favorite civilizational rhetoric—the rising Eastern civilization being today in a position to give lessons to the West—, it also emphasized once again the strength of the Turkish-Azerbaijani alliance. Indeed, since the early 2010s, relations between the Big Anatolian and its little South Caucasian brothers, which used to be viewed with a certain amount of scorn and at times even suspicion, seem to have changed considerably in favor of the latter. Year 2013, when Turkey's Star Media group Star—including the above-mentioned newspaper—was sold to the Azerbaijani state-controlled oil group SOCAR may be considered as a key year when intensified relations between the two states became more conspicuous. It also happened to be the year when Mr Erdoğan and Mr Aliyev were both named “Statesmen of the decade” by Turkish economic magazine Ekovitrin (close to AKP governments). This major change in relations may also partly account for the failure of the political rapprochement between Turkey and Armenia initiated at the end of the 2000s. And the growing and multifaceted influence of Azerbaijan over Turkey—a  much larger and more populated country (with 80 million inhabitants compared to Azerbaijan's barely 10 millions)—has   turned into a phenomenon worth paying more attention to. Three dimensions may be analyzed here, which are not exhaustive: 1. energy dependence as a backdrop; 2. the acceleration of direct Azerbaijani investments, and 3. the spectacular deployment of Azerbaijani soft power in Turkey—all three aspects developing over a very short timeline of less than ten years.

The energy dimension 

It comprises two sub-issues: the increase of oil import-exports and the development of infrastructures to consolidate Turkey's “energy corridor”. The striking rise in oil trade between the two countries is connected to Turkey's energy dependence, which forces the country to diversify and safeguard its supplies until it can ensure its own energetic independence—a priority goal of Turkish policies. The electricity production and urban heating are massively dependent on imported oil and gas, in particular from its South-Caucasian neighbor. Although Azerbaijan provided only10 percent of Turkey's gas imports in 2017, this share has significantly increased in the last years and is bound to rapidly rise some more, with that massive energy bill consequently increasing Turkey's dependence on Azerbaijan as a provider.

As regards oil and gas transportation infrastructure from the Caspian to Turkey and beyond, to European markets, there has been a flurry of new projects in the last years with an accelerated rhythm of implementation. Their timeline is familiar, as the subject was widely discussed in the international press because of its enormous financial and geopolitical stakes as well as the economic involvement of many multinational corporations and the financing provided by the European Investment Bank.

May 2006: Opening of the Baku-Tbilisi-Ceyhan (“BTC”) oil pipeline, Ceyhan being located on the Mediterranean coast of Turkey; end of 2011: launch of the TANAP project (trans-Anatolian gas pipeline from the Caspian Sea to Greece (a 60 percent ownership of Azerbaijani state company SOCAR), whose completion is announced for 2019; to which should be added the Baku-Tbilisi-Erzurum (BTE) gas pipeline, aka “Shah Deniz” Pipeline,  involving SOCAR, BP, Lukoil and Turkish state company TPAO... Once the last two facilities are operational, oil exports from Azerbaijan are bound to be booming.

Economic integration

This is where the changes in the last years have been the most spectacular, prompting to speak of a growing interdependence between the Turkish and Azerbaijani economies. What does this interdependence imply? It is striking when you consider trading of goods between the two neighbors. In 2016, Turkey has become Azerbaijan's second trade partner after Russia for imports. And although Turkey is only Azerbaijan's 6^th partner for exports—and because of its small market a very modest trade partner of Turkey—Turkish exports to Azerbaijan have strongly risen lately, growing eight-fold in value from 2003 to 2013! The organization of a Turkish-Azerbaijani business forum in 2006 seems to have initiated that rapprochement, which was sealed in 2010 by the creation of a permanent structure, the “Turkey-Azerbaijan High-Level Strategic Cooperation Council” (AzerTAC). After the opening of a new border checkpoint in Iğdir in 2015, the goal is to bring the value of trading between the two countries to 20 billion US dollars by 2020.

In addition to that, if you consider the flow of foreign direct investment (FDI) between both countries, the end of the 2000s is characterized by a clear and steady increase, to the point that in 2008, Azerbaijan has become Turkey's first foreign investor while Azerbaijan is now the country where Turkey has the most foreign investment—thus showing neat reciprocity. The surprising 2008 performance is due to the investment made by state company SOCAR and Turcas Petrokimya A.S. in the Turkish energy sector, particularly with the gradual buyout of the PETKIM oil refinery in Aliağa-Izmir. Later on, new investment was announced involving the building of a new oil refinery—aptly named “Star”—also in Aliağa. Announced in May 2013, the project, which also associates Spanish and Japanese firms, would represent a total investment of some 17 billion US dollars phased until 2018. Conversely, there are—according to official Turkish statistics—over 2,500 Turkish companies in Azerbaijan, many in the building sector, which have completed 363 projects since Azerbaijan's independence for a total value of 11 billion US dollars.

In the tourism sector, the intensification of relations is also striking. In 2015, over 600,000 Azerbaijani citizens traveled to Turkey. Even if the figure pales in comparison with the 2 million Georgians, for instance, the trend is on a sharp rise. The main increase however took place in the previous decade, with the number of Azerbaijani travelers to Turkey rising from 122,000 to 486,000 between 1999 and 2010. Most of these “tourists”, however, are “suitcase trade” travelers, often women, who “commute” between the two countries carrying a range of products (often textiles) which they buy in Turkey and then sell in Azerbaijan. Turkish citizens are also one of the first group of foreign tourists in Azerbaijan, the third largest in 2013.

Besides, if these figures were to include (which couldn't be done for this article) Russian citizens of Azerbaijani descent, who are de facto and via Russia important players of the Turkey-Azerbaijan economic rapprochement, they would be even more striking. These citizens are particularly important within the framework of  today's redefined Turkish-Russian relations.

An Azerbaijani soft power?

Finally, since 2013, there has been at various levels a genuine Azerbaijani soft power effort developed in Turkey—and elsewhere, in several European countries, such as Italy. The state and large  public and private Azerbaijani corporations have financed numerous activities in the Turkish media, culture, publishing and even in the university. As regards foreign students enrolled in Turkey, the largest group has been that of Azerbaijani nationals for quite a number of years.

Besides the 2013 SOCAR buyout of the Star Media Group—comprising a daily newspaper and two national TV channels—, many conferences, colloquiums, documentary films and exhibitions have been supported by Azerbaijan, contributing to favorably influence Turkish public opinion towards its smaller neighbor on some sensitive issues. Collaboration between the Turkish state archives and Azerbaijani archives—as the result of a protocol signed in May 2012 and extended in November 2013—also goes in that direction. In this perspective, a common (re)-writing of history has been undertaken... Turkish-Azerbaijani film productions have also recently appeared on the screens, such as the   comedy drama Aşka Geldik released in the fall of 2017.

So, with the opening of a Yunus Emre Institute in Baku, the closing down of Turkish schools connected to the Gülen movement in Azerbaijan, reopened under another management (Maarif Vakfi), and the closing down of Kafkaz University, the cultural action of the little Azerbaijani brother is far from negligible and seems very targeted, in particular towards a younger school-going public.

In conclusion, the recent consolidation of the multifaceted interdependence between Turkey and Azerbaijan appears extensive, with multiple consequences, and should be better paid attention to by observers. Beyond the “One nation with two states” political slogan, there is a need to concretely assess the effects of integration through transport infrastructure, energy policies, trade flows and the circulation of men and ideas.