David P. Goldman, editor of the Asia Times, Washington Fellow at the Claremont Institute, and senior writer at Law & Liberty, spoke to a February 27th Middle East Forum Webinar (video) about global alliances being reshaped by the war in Ukraine. The following is a summary of his comments:
In order to sustain its economy while continuing its war against Ukraine, Russia, along with its "sometime friends and sometime allies," persists in efforts to evade U.S. sanctions and "reorganize trade flows." One of the key countries participating in this effort is Turkey, under the direction of its president, Recep Tayyip Erdoğan. In the past, Erdoğan's economic policies had pushed his country to the "brink of bankruptcy." Its reserves were running out, it had one of the worst performing currencies, and its stock market "was in the dumps."
However, in the past three years, Turkey's disastrous economy has done an about face to become "one of the fastest growing in the world." Inflation is down, its currency has stabilized, and its asset prices "rose sharply." Erdoğan has managed to accomplish this through a variety of cunning policies. He has tripled the amount of imports from China and, in turn, tripled exports to Russia. And he has evaded U.S. sanctions by shipping essential goods to Russia, including computer chips used in Russia's military, and not reporting them. This could explain why there is a $25 billion discrepancy on Turkey's balance sheet and why the Turkish Central Bank does not know what $25 billion that recently turned up in its foreign exchange coffers is for. Due to the surge in Turkey's trade, it has the best performing stock market in the world.
Erdoğan's emergence as a "prosperous leader of a burgeoning third world economy" is the result of a shrewd policy of "building up blackmail capability against everyone he deals with." For many years, Erdoğan aided the Muslim Brotherhood (MB), a movement that, given its "totalitarian vanguard policy," threatened the security of the Gulf monarchies. In exchange for restraining the MB, Erdoğan secured a $10 billion loan from the United Arab Emirates (UAE) in 2022, thereby changing Turkey's fortunes for the better. Erdoğan has also amassed a sizable amount of trade credits from China by bargaining with Beijing over the Uyghurs, an oppressed group in western China who are "Turks of Asiatic background." Beijing would face considerable problems if Ankara should support Uyghur insurgencies. Instead, Erdoğan has deported some Uyghurs back to China in exchange for these credits.
Washington's reliance on Ankara's cooperation in the Black Sea makes the U.S. vulnerable to Turkey's pressure. Key NATO's priorities include "having control of the Black Sea, limiting Russian operations, [and] maintaining cooperation with other NATO countries in the Black Sea, including Romania and Bulgaria," because, should Moscow block Ukraine's access to the sea, it would render Ukraine landlocked. As a member of NATO and a country that borders the sea, Turkey can play a crucial role in this regard. Consequently, the U.S. is loath to deny arms sales to Turkey, for if Washington were to demur on these arms sales, Turkey could turn to China and Russia to fill the void. China could sell its new fighter jets and missiles to Erdoğan, and Russia has already sold Turkey the S400 anti-aircraft system.
Sweden and Finland, eager to join NATO given Russia's imperialist ambitions, are relying on Turkey's vote as a NATO member for their entry to the organization. However, Erdoğan is looking "to gain leverage in the Kurdish issue." Thus, although he is willing to let Finland join NATO, Erdoğan is demanding Sweden's cooperation in suppressing Kurdish opposition to his regime in exchange for his support of its membership in NATO. Erdoğan sees Turkey's Kurdish minority as an "existential issue for the Turkish state" since the Kurdish fertility rate, which far outpaces that of ethnic Turks in southeast Turkey, ensures that Kurds will make up an increasingly larger proportion of Turkey's future population.
Further complicating the picture is America's concern over China's Huawei 5G broadband, which Turkey has installed "to raise its productivity." It has stoked Washington's fears that China, should it somehow access information "on F-35 flights and learn how to defeat stealth," will share this information with Russia. And were Russia to consider exporting the longer-range S400 missile defense system to Iran, the concern is whether Israel's F-35s "have enough stealth capability to evade Russian anti-stealth technology."
The new configuration in the Middle East creates multiple variables as to the direction Turkey, China, and Russia will take with Iran, which is a "problematic partner." China, Iran's ally for two decades that helped build its ballistic missile capability, has increased its exports to Saudi Arabia while reducing exports to Iran, thereby making Riyadh more important to China than Tehran. In a recently issued joint statement with the Gulf Cooperation Council, China, which depends on the flow of oil from the Persian Gulf and wants to control Iran, publicly criticized Iran for not reining in its "destabilizing regional activities." China's dependence on Persian Gulf oil could cause it to serve as a "stabilizing force" in the region because repercussions from a war between Iran and Saudi Arabia would pose an existential threat to China's economic survival.
In contrast, Russia is an "open ally" of Iran's and has gone beyond its purchase of the regime's "inexpensive drones" by agreeing to sell SU-35 fighter planes to the ayatollahs. Russia's offensive in Ukraine has increased Moscow's trade relationship with the Islamic Republic in a dangerous way. If Iran acquired effective air defense systems to protect its nuclear program against a possible Israeli strike, "the military balance in the Middle East" would completely shift and threaten the Jewish State's existence. Since 2016, Israel has had the latitude, with Russia's understanding, to destroy Iranian positions in Syria, but "the Ukrainian war could change all that."
Even though Turkey has improved its diplomatic relations with Israel, Erdoğan plays both sides by hosting Hamas in Istanbul and refusing to remove its leaders. Turkey has an "opportunity" to behave like a responsible actor and stop evading sanctions, as it is doing by enabling Moscow to depend on Ankara to move Russian oil "through informal means." However, the moving parts in the region create more questions than answers. China's postures toward Iran and Turkey, the Russia-Iran alliance, and Israel-Turkish relations have yet to be taken. It is also uncertain as to how these new alliances will ultimately play out.
The global response to the Ukraine war presents many risks and opportunities, but the unknowns are the only certainties. Unfortunately, the U.S. is not in the position to match China's advances toward Turkey, which should be a "wake up call" for America's economic policy. The key for Washington is keeping Russia "as the odd man out." As for the U.S. approach to Turkey, "we should exercise every possible pressure we can on Turkey to keep them in the fold and stop them sandbagging us."
Marilyn Stern is communications coordinator at the Middle East Forum.