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Wed, February 13, 2013 | By Richard Weitz

This article was first published in the Turkey Analyst, vol. 6 no. 3 (www.turkeyanalyst.org), a biweekly publication of the Central Asia-Caucasus Institute & Silk Road Studies Program Joint Center. © Central Asia-Caucasus Institute & Silk Road Studies Program Joint Center, 2013.

Turkey and Iran continue to resist the strong trends driving them to renew their Cold War of previous decades. Thus far, Turkey and Iran have been able to cooperate on some issues even while they conflict on others. Though they engage in a proxy war in Syria and fight over NATO’s missile defense policies, Turkey and Iran have developed perhaps their closest economic ties in modern history, with Western sanctions squeezing out competitors and allowing Turkey to finally achieve a trade surplus when dealing with Iran after years of massive deficits.

Turkey’s PM Erdogan (L) shake hands with Iranian President Ahmadinejad

Background

The renewed Turkish-Iranian tensions of recent years mark a regression to the historic pattern for their relationship. Clashes between the imperial ambitions of the Turkish-centered Ottoman Empire and the Safavid Persian dynasties shaped regional politics for centuries. Relations between Turkey and Iran were strained even during the 1990s, when both governments suspected the other of promoting terrorist and separatist movements against them. It has only been in the last decade that Turkey, under the rule of the Justice and Development Party (AKP), has significantly improved its relations with the Iranian government.

At first, the presence of overtly Islamic parties in charge of both Ankara and Tehran encouraged Turkish-Iranian reconciliation, but more recently it has become a source of division. Turkey’s secular political parties and national security establishment, which dominated Turkey’s foreign policy until a decade ago, generally perceived Iran, as well as Syria as potential threats, and sought to develop security ties with Israel. But the Islamic orientation of the AKP has meant that the current generation of Turkish and Iranian leaders now shares a common devotion to Islam and animus towards Israel’s treatment of the Palestinians.

But soon this religious element became a source of division as Prime Minister Recep Tayyip Erdoğan began to displace President Mahmoud Ahmadinejad and other prominent Iranians as the most popular Muslim leader among the Arab masses due to the AKP’s public attacks on Israel and their support for various pro-Palestinian initiatives such as the controversial “freedom flotillas” seeking to defy Israel’s blockade of Gaza. Erdoğan has recommended that the new regimes in the Arab world follow Turkey’s model, whereas Iranian government representatives have told them to establish an Islamic Republic, as in Iran. During the past year, Turkish leaders have backed Sunni opponents of Iranian supported (as in Iraq and Syria) and Sunni governments facing mass Shiite opposition (as in Bahrain), while Tehran has adopted an opposite position.

The same pattern occurred with respect to regional security issues. In addition to renouncing security ties with Israel, the AKP pleased Iran by seeking to reconcile with its Syrian ally. The AKP launched a range of cooperative initiatives with President Bashar al-Assad. In the process, the new leaders in Turkey managed to dampen Syrian support for the Kurdistan Workers’ Party (PKK), a policy that Tehran soon followed. A few years ago, Turkish and Iranian authorities began exchanging counterterrorist intelligence and coordinating military strikes against Kurdish terrorists in northern Iraq.

But since the AKP government decided to throw its support behind the Sunni rebels in Syria, Iranian support for the PKK has resumed. Iranian leaders have complained about Turkey’s becoming the main regional backer of the armed opposition seeking to overthrow al-Assad. A more recent dispute has been Turkey’s successful appeal in November 2012 that NATO deploy Patriot air defense systems on Turkish soil to defend Turkish territory against Syrian air and missile strikes. Iranian analysts fear the Patriots could serve as the basis of a no-fly zone that would deprive the al-Assad regime of one of its few advantages over the insurgents. Iranian president Ahmadinejad canceled a planned visit to Turkey, a step the Iranian media said attributed to the Patriot deployments.

Iraq has also become a major source of bilateral tensions. Turkey does not want Iran to dominate Iraq. The Turkish fear is that Iran seeks a weak and divided Iraq that is unable to contest Tehran’s drive for regional primacy. Turkey also perceives Iran as wanting a subservient Shiite regime to rule Baghdad that would not resist Iranian political and economic control over Iraq. In contrast, Turkey favors a strong Iraqi state ruled by a coalition of political forces that can maintain domestic stability as well as contribute to regional security. These conditions would be favorable for reviving Iraq’s hydrocarbon production, which would benefit Turkey as a key transit state for Iraqi oil and gas, and restoring Iraqi economic growth, which would support Turkish investors and traders. These different strategic visions have led Turkey and Iran to back opposing political forces in Iraq.

Patriot air defense system

Implications

Even the nuclear issue has lost its ability to sustain good Turkey-Iran ties. Ankara gained some credit in Tehran in 2010, when it sought to galvanize a confidence-building agreement between Iran and the West over its nuclear file. When Western governments rejected that deal, the Turkish delegation to the UN Security Council voted against imposing additional sanctions on Iran. Although Iranian leaders appreciated Turkey’s support and the harder line that the AKP government adopted toward the Palestine question, they subsequently accused Turkey of colluding with Israel against Iran after Ankara announced in September 2011 that it would allow NATO to establish an early warning radar in southeast Turkey whose obvious, if unstated, purpose is to track Iranian missiles.

Turks now express irritation at Iranian ingratitude for their efforts to mediate between Tehran and the West. Iranian carping often includes threats as well as criticisms. Erdoğan has since stopped accepting at face value Iranian pledges never to develop nuclear weapons, insisting that Turkey would feel compelled to seek nuclear weapons too if Iran ever acquired them. Iran recently proposed Kazakhstan and other countries as suitable hosts for holding future Iranian nuclear negotiations, excluding Turkey, whose government has now adopted a significantly lower-key approach to the Iranian nuclear issue.

Turkish leaders nonetheless still oppose the international sanctions on Iran due to the economic costs on their own country as well as the Iranian people. Following a 1996 deal, Turkey imports about 30 million cubic meters of Iranian natural gas per day (10 billion cubic meters annually) from Iran through a direct pipeline. Turkey also buys 200,000 barrels of oil each day. These flows — equivalent to 20 percent of Turkey’s gas imports and 30 percent of its oil imports — help balance Turkey’s energy dependence on Russia, which provides Turkey with most of its oil and is building its first nuclear power plant. On the strength of these economic ties, Turkey-Iran trade now exceeds $20 billion.

Turkish policy makers have felt obliged to accept the mandatory sanctions imposed by the UN Security Council, but they have resisted applying the supplementary sanctions adopted by Western governments, which include not purchasing Iranian energy or selling Iran precious metals. U.S. and European officials have generally not pressed Ankara on this issue, but fearful Turkish businesses have been cutting their ties with Iran in any case rather than risk losing accessing to global Western-dominated economic and financial systems. Plans to develop massive energy pipelines connecting the Caspian Basin to Europe through Turkish territory are much harder to realize without Tehran’s participation or even consent. The Iranian authorities have suspended visa-free travel with Turkey, contributing to a sharp fall in the number of Iranians tourists in Turkey, which as of 2011 had approached two million. Turkish purchases of Iranian oil have declined while Turkish financial institutions have become more reluctant to serve as intermediaries for third parties seeking to trade with Iran.

Nonetheless, the Westerns sanctions have ironically been providing important benefits to the Turkish economy. Turkish businesses still face numerous obstacles to doing business in Iran, ranging from Iranian-made red tape to the international sanctions. But the sanctions have excluded many Western competitors that Turkish firms still must compete against in other markets, including the Middle East. Most importantly, Turkey cannot pay for Iranian energy imports in dollars or Euros, so Iranian corporations have had to accept Turkish Lira and then use that currency to buy gold in Turkey, which can be sold in Gulf markets for a more convertible currency. This new practice has recently helped even the trade balance after years of large Turkish deficits.

For their part, Iranian leaders have resisted breaking entirely with Turkey. They already have enough potential adversaries, so having a powerful neighbor that opposes using force against Iran is still a great advantage. Iranian authorities appealed to Turkey to use its contacts with the Syrian opposition to help secure the release of 48 Iranian hostages. The two countries are establishing a joint university, a joint economic commission, and more transit and border terminals. Turkey and Iran have not fought a war since the 17th century, and the popular mood in both counties is against another bilateral armed conflict. In public, influential Iranians have been attributing some of their tensions with Turkey to Western machinations and “Zionist plots”. And many Iranians still hope that Turkey will refrain from biting the bullet and actually sending its own military forces into Syria. Without them, the al-Assad regime might be able to survive for years in a stalemated civil war.

Conclusions

Even beyond economic ties, Turkey fears that isolating and threatening Iran could further radicalize Iranian foreign policy. An alienated Iranian government might deepen its ties with terrorist organizations, intervene more deeply in Iraq and Afghanistan, and take other actions designed to retaliate against the United States and its allies, like Turkey. And a war between Iran and the West would — in this perspective — prove disastrous since Turkey’s regional interests would severely suffer, as they did during the confrontation between the United States and Saddam Hussein’s Iraq. The losses from a war involving Iran would be even greater.

Nonetheless, the Turkish-Iranian relationship is primed for problems due to differing geopolitical and sectarian interests. Turkey and Iran have already resumed their historic pattern of eschewing direct wars by fighting one another by proxy. After decades in which one or the other power was clearly dominant, we now have a dangerous equipoise in which both these non-Arab regimes consider themselves rising powers that deserve preeminent say in the Middle East. But by definition, at most only one of them can exercise that primacy.

Richard Weitz is Senior Fellow and Director, Center for Political-Military Analysis, Hudson Institute.