Cost of Russia's bluff also on Russia - ERDAL TANAS KARAGÖL

Cost of Russia's bluff also on Russia

The question of sanctions on energy that has loomed since day one of the jet crisis between Russia and Turkey has come to nothing because of mutual dependency between the two countries.

However, an announcement from Russian gas supplier Gazprom, which supplies gas to Turkey's private sector via the Batı Hattı natural gas company, that it would cut down on its supply has brought this issue back onto the agenda.

It is important to express this reality: Gazprom's reasons for the cutback on gas supply to Turkey being “seasonal conditions” and “price agreement” are not very realistic. This strategy, also used by Iran from time to time, is nothing but an excuse. Decisions to cut back gas supply coinciding with political conflicts between countries cannot be explained by coincidence.

A cutback in gas supply does not pose a risk for Turkey at this stage. The situation is crucial for Russia. A country that has tied its economy to income from petrol and natural gas, cannot risk losing its natural gas market (Turkey) during a time in which petrol prices are about $30 a barrel.

Besides, Russia cannot risk it at all when Turkey is developing alternative routes to Russia in case of a cutback and talking about increasing its natural gas storage capacity such as LNG storage and terminals.

If such a risk is taken, Russia will pay a very heavy price. Moreover, this issue will only worsen Russia's already poor image in the international market.

Since the jet crisis, Russia has resorted to applying trade and economic sanctions on Turkey, or “punishment” as the Russians call it. The first sanctions were applied to fruit and vegetables. This was followed by embargos on the construction, tourism and textile sectors.

At a time in which petrol prices are so low and the state of the Russian economy is not pleasant, the news that the “sanctions have been eased” only two months after Putin signed for these sanctions to start, indicates that the sanctions chain will break before the last ring, energy, is used.

TURKEY IN THE ECONOMIC POWER BALANCE

The effort to create a negative perception and constantly give the impression that everything is going bad, under the guise of “speaking the truth” about the country's economy, which has already assumed the costs of geopolitical risks and whose economic power disturbs certain circles, has no benefit for anybody.

The same thing happened before credit rating agency Fitch's evaluation, too. Some circles were expecting Turkey's credit rate to drop, maybe not officially but figuratively, basing it on Turkey's political environment not being fit for economic activities.

Yet, the expected didn't happen. Fitch continued Turkey's “appropriate to invest” rating and its “stable” appearance. But this rate is below the rate Turkey deserves. Those who wrote crisis scenarios on the growth rate in 2015 didn't find what they expected after Fitch's statements.

Besides, credit rating agency Moody's Turkey analyst openly stated yesterday that Turkey's economic growth performance is still powerful compared to the developing big economies. The fiscal management indicators, public debt and budgetary deficit being positively distributed in the gross domestic product share when compared to other developing economies is the reason for Turkey's image.

It is meaningless and useless to try to create a crisis perception in Turkey's economy, especially at a time in which geopolitical risks have increased. Yes, we do have structural problems in our economy and these pose as obstacles preventing Turkey from entering the high-income economy groups. It is ruthless to try and portray the country economy as fragile, especially when we are in an economic power race, instead of trying to develop solution recommendations, talk about the deficiencies and the actions to be taken.

Turkey is the way out with its political and economic stability in the Iraq, Syria and Iran triangle. Turkey has burdened itself with the cost of the chaos in the region; it is the playmaker because of its economic power.

Trying to portray his own country as weak, especially in times of geopolitical risk, while not saying a single word to other countries, will only decrease Turkey's weight on the power scale.



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