Erdogan Fosters Nuclear Cooperation with Russia

The Turkish Prime Minister Recep Tayyip Erdogan, accompanied by several of his ministers, including Foreign Minister Ahmet Davutoglu and Energy Minister Taner Yildiz, recently visited Moscow. Carrying a busy portfolio, he met his Russian counterpart Vladimir Putin and Russian President Dmitry Medvedev.

Reflecting the spirit of the flourishing partnership in various fields, Erdogan emphasized that a wide array of opportunities existed for the two countries to deepen their cooperation. He vowed to raise the trade volume from its current level of around $35 billion to $100 billion within the next five years. Putin also supported Erdogan’s statement, underlining that despite the global financial crisis Turkey remained a key trading partner for Russia. However, he added that economic cooperation should be taken beyond trade, and that the parties should increase their mutual investments. For his part, Medvedev reiterated his satisfaction with the “accelerating momentum” in Turkish-Russian ties and argued that the relationships deserved to be called “strategic” (www.cnnturk.com, January 13).

The Turkish and Russian leaders discussed several specific projects to improve bilateral relations. Following the pattern of similar agreements that Turkey has recently signed with various countries, Erdogan proposed to mutually lift visa requirements for their citizens. He added that Moscow agreed to initiate the groundwork on this proposal and an agreement might be signed during Medvedev’s visit to Ankara later this year. They also agreed on some specific measures to boost economic cooperation, such as accelerating work on the use of national currencies in trade, and facilitating the export of Turkish goods, especially agricultural products and poultry, to Russia.

Regional issues were also part of Erdogan’s agenda. He exchanged opinions with his counterparts on the diplomatic standoff over the Iranian nuclear issue, the security situation in the South Caucasus, and the status of the Turkish-Armenian and Azeri-Armenian disputes. However, in a development reflecting underlying points of disagreements between the two countries, the Turkish press reported that Putin expressed his objection to solving disputes in the South Caucasus through a “package deal.” Ankara has argued that the progress of the Turkish-Armenian rapprochement will be conditional on the resolution of the Karabakh issue. Reportedly, the Turkish side solicited Russian help on this issue, but Putin rejected such a linkage (Hurriyet, January 14).

However, the main item on the Turkish-Russian agenda was energy cooperation, which forms the core of the strategic partnership. Putin emphasized the importance of maintaining the recent momentum achieved in energy cooperation. He proposed that, considering the participation of the Italian energy companies in several of the Russian-Turkish projects, the three countries should sign a trilateral agreement to further their pipeline partnership (Anadolu Ajansi, January 13).

Russian and Turkish sources reiterated their pleasure with the progress achieved in the South Stream and Blue Stream projects, and Putin noted that the construction of South Stream might start in November. A related item was the construction of the bypass oil pipeline (SCP) to connect Turkey’s Black Sea port of Samsun to Ceyhan terminal on the Mediterranean coast, which will reduce the heavy traffic through the Turkish Straits. The Russian decision to support this project, after years of objection to diverting some Russian crude exports to this corridor, was presented by the Erdogan government as a major success. The Russian Deputy Prime Minister Igor Sechin underlined that Moscow is eager to further support the SCP, while currently negotiating the conditions on obtaining a share in the consortium that will lay the pipeline infrastructure (Dunya, Cihan, January 13).

The conditions upon which Russia agreed to give support for the SCP resulted in a new nuclear power cooperation agreement. As many observers highlighted, Putin had conceded to Turkey on the SCP, in return for Erdogan’s pledge to proceed with the legally problematic nuclear power tender so that the consortium led by Russia’s Atomstroyexport could construct and operate Turkey’s first nuclear power plant. Since the contract was cancelled by the Turkish courts in November, there has been a debate on how Turkey might continue with its nuclear plans, and whether Erdogan can deliver his end of the grand bargain, by satisfying Russian expectations.

Yildiz, who has long advocated exploring the prospects of greater public participation in order to ensure the feasibility of the nuclear project, insisted that the government will remain committed to it. Global energy giants have also expressed interest in entering the Turkish nuclear energy market in light of Ankara contemplating a new tender (Today’s Zaman, January 6). Nonetheless, Yildiz has indicated that the government might explore other options not requiring a tender (www.nethaber.com, November 22, 2009).

The nature of this alternative solution became clearer during Erdogan’s visit. Turkey and Russia inked a declaration committing them to cooperate in the construction of the nuclear power plant. Ankara and Moscow will initiate a process to discuss the prospects of building the power plant through an inter-governmental agreement, rather than a public tender. If they reach a consensus, they will sign the inter-governmental agreement on starting the construction. The German company Siemens is also expected to be given a 15-20 percent share in the project. While highlighting the advantages of the Russian offer, Putin maintained that they would open credit opportunities, ensure the participation of local construction firms and provide nuclear fuel (Cihan, January 13; www.turkrus.com, January 14). This development makes more sense against the background of a memorandum of understanding signed between Siemens and Rosatom on the creation of a nuclear joint venture last year (www.siemens.com, March 3, 2009).

Although Erdogan maintained that the necessary legal requirements will be concluded promptly, this agreement is likely to encounter domestic opposition. Many have strong reservations on awarding the nuclear deal to Russia, considering that the country is already dependent on Russian gas for almost 70 percent of its domestic needs. Moreover, proceeding with this project through an inter-governmental agreement rather than a public tender will raise questions as to the nature of the complex relationships that the government has forged with Russia on the one hand, and the Turkish business community, on the other.