Is the economic cooperation between Moscow and Ankara being restored?

The 6th meeting of the Russian-Turkish Cooperation Council of the highest level
The 6th meeting of the Russian-Turkish Cooperation Council of the highest level

The decision of the government of Turkey to suspend the issuance of the licenses for the duty-free importation of wheat, corn, sunflower oil and meal from Russia since March 15 has forced the experts to talk about another reduction in the level of the economic interaction between Moscow and Ankara. According to the Deputy of the Faculty of Journalism of the Moscow State Institute of International Relations (U) of the Russian Ministry of Foreign Affairs, the expert of the INFDC, Nigar Masumova, the economies of the both countries have already suffered as a result of the curtailment of the economic cooperation.

"In a very short time, the foreign trade turnover between Russia and Turkey has reached the colossal figures. Prior to the 2008 crisis, it had reached $ 38 billion. In 2000, it was about $ 4.5 billion. Before the last sharp drop of the prices for energy resources, the trade between Russia and Turkey had amounted to about $ 32 billion. The balance of trade between the countries is sharply positive. This is mainly due to the export of energy resources to Turkey. Russia traditionally exports energy resources, oil, gas, various metals, coal to Turkey, and imports ready products from Turkey: textiles, household appliances, machinery, equipment and components. "

According to the expert, several negative factors influenced the dynamics of the bilateral trade: "The world economy is not in a better condition now. The pace of growth of the leading world powers is slowing down. An indelible mark on the economic cooperation was also left by the restrictive measures on the part of Russia in connection with the downed Russian plane. The restrictive measures affected only the agricultural products, and this amounts to 15% of Russia's imports. The agricultural products occupy a small share in Russia's imports, but plays an important role in the Turkish economy. About a quarter of the population of Turkey is employed In this industry. About 9% of the country's GDP amounts to the agriculture. And this sensitive industry suffered first of all.’’

Nigar Masumova

According to Masumova, as a result, the trade turnover for 2016 amounted to about $ 15 billion: "This is despite the fact that the leaders of Turkey constantly remind us that we have a very large potential for the development of the foreign trade and designate a figure of  $100 billion. Of course, this figure is fantastic, but, having designated such a maximum limit, we will be able to achieve the maximum result. "

Touching upon the problem of the investments, the expert reminded that Turkey does not play a primary role in the volume of the foreign direct investment in Russia: ‘’A short-term deterioration of the relations, of course, may negatively affect the investment attractiveness of the Russian Federation. The 6th meeting of the Russian-Turkish Cooperation Council of the highest level showed the intention of the both sides to gradually restore the previous volume of cooperation. Obviously, the situation can drastically change. The prospects for the development of the bilateral investment cooperation have a very promising future. To date, the tourist flow from Russia has decreased by about 2.5 million. But this situation concerns not only Russian tourists. The tourism industry in Turkey has suffered as a whole. A retrospective analysis of the Russian-Turkish economic relations shows only one thing - that Russia and Turkey are the natural partners, and this partnership needs  to be deepened and strengthened.’’