The Turkish Ministry of Trade said: “Export and import transactions related to Israel have been suspended for all products. Turkey will implement these new measures strictly and decisively until the Israeli Government allows an uninterrupted and sufficient flow of humanitarian aid to Gaza.”

This move follows a previous trade restriction announced last month, during which Turkey restricted exports in 54 categories, including iron and steel products, jet fuel, construction equipment, machinery, cement, granite, chemicals, pesticides, and bricks.

In 2023, trade between Turkey and Israel amounted to $6.8 billion, with 76% representing Turkish exports to Israel. According to the Turkish Statistical Institute (TÜİK), Israel ranked 13th on Turkey’s list of export destinations in 2023, with $5.4 billion in exports.

Turkish exports played a crucial role in Israel’s economy. Before the embargo, Turkey had been Israel’s largest steel and cement exporter. Azerbaijani oil and even barbed wire were shipped to Israel through Turkish ports. Additionally, Zorlu Holding, a Turkish company, produced 7 percent of Israel’s annual electricity.

A Move to Regain Domestic Support?

During the campaign for the elections held on March 31, Erdoğan’s governing Justice and Development Party (AKP) faced criticism for maintaining trade relations with Israel despite the ongoing conflict in Gaza.

TRT World Video: “Türkiye halts trade with Israel until Gaza ceasefire”

Meanwhile, pro-government voices were claiming that the shipments to Israel were actually destined for Palestine. In December 2023, Trade Minister Ömer Bolat stated: “Goods arriving in Israel are destined for Palestine. [On the shipments], the destination must be written as Israel. Unfortunately, trade with Palestine must necessarily be conducted through Israel.”

AKP’s former ally, the hardline Islamist New Welfare Party (YRP), repeatedly criticized the government’s Gaza policy, using the slogan “Trade with Israel is a betrayal to Palestine.”

Before the local elections, Erdoğan criticized YRP by accusing them of harming AKP by dividing their votes. In response, YRP leader Fatih Erbakan said, “We are not making you lose; continuing trade with Israel is what is causing you to lose.”

While Turkey’s economic problems, such as decreasing pensions and salaries amidst soaring inflation, were the main factors behind AKP’s electoral loss, Turkey’s ongoing trade with Israel also played a role among conservative voters. This was even acknowledged by Erdoğan himself during a party meeting discussing the election results, as reported by party insiders.

On April 7, a week after the elections, police violently dispersed demonstrators on Istanbul’s Istiklal Street who were protesting trade with Israel. Despite the peaceful nature of the pro-Palestine protests, police detained 43 people.

Economic Impact

Israeli-Turkish relations under Erdoğan have been characterized by significant fluctuations and tensions. In the early 2000s, relations between Israel and Turkey appeared to be warming until the Gaza flotilla incident in 2010.

Despite strained diplomatic relations since 2010, trade between Israel and Turkey has flourished. In 2022, the two countries restored diplomatic relations, but their relationship has been deteriorating again since October 7.

Turkish investigative journalist Metin Cihan has been highlighting Turkish shipments to Israel since the beginning of the war. After the Ministry of Trade announced the trade suspension, Cihan claimed that he identified ships in Turkish ports that reported their destination port as Israel.

And, on May 5, Good Party (IYI) MP Turhan Çömez shared port records from his X account, revealing that Turkon Istanbul, a cargo vessel, departed from Iskenderun port and arrived in Haifa two days after the trade suspension with Israel.

According to the Israeli financial newspaper Globes, Azerbaijani oil was still being loaded onto tankers bound for Israel at the Turkish port of Ceyhan. Azerbaijani oil is transported via the Baku-Tbilisi-Ceyhan (BTC) pipeline, and from Ceyhan, it is transported to Haifa.

Moreover, Reuters reported that Turkish exporters are exploring alternatives to resume trade with Israel by considering routes through third countries such as Egypt, Jordan, or Lebanon. Four owners of export companies said that Turkey’s decision to suspend trade with Israel caught them off guard.

Israeli Foreign Minister Israel Katz criticized Turkish President Recep Tayyip Erdoğan’s decision to halt trade with Israel, saying “This is how a dictator behaves, disregarding the interests of the Turkish people and businessmen, and ignoring international trade agreements.”

Katz also added that he instructed the Israeli Foreign Ministry Director General Yaakov Blitshtein to “immediately engage with all relevant parties in the government to create alternatives for trade with Turkey, focusing on local production and imports from other countries.”

In conclusion, Turkey’s decision to suspend trade with Israel amid the ongoing humanitarian crisis in Gaza may be seen as a genuine expression of solidarity with Palestine. However, given the timing following an election loss and amidst protests, it’s plausible that this drastic policy change could also be interpreted as an attempt by Erdoğan to regain support from conservative voters.

Moreover, Turkey has stated that the trade suspension will continue until Israel permits an uninterrupted and sufficient flow of humanitarian aid. Whether Israel will reconsider its policies towards Gaza in light of international isolation remains uncertain.

The Asian Exchange Union was established in 1972 and was intended to decolonize the banking system and allow member states to trade with one another without going through the old imperial powers. It never has, however, amounted to much, though it may suddenly be a bigger deal if Iran’s plans are implemented.

In the end the representatives voted to explore the formation of a non-dollar basket of currencies, to bring into being a digital currency controlled by the central banks of member states, and setting up an international banking exchange to rival the US-dominated SWIFT. The US has kicked both Iran and Russia off of SWIFT and interdicted their use of dollars, which has hurt their trade and foreign exchange reserves.

The non-dollar basket of currencies to be used as an alternative to the US dollar as a reserve currency would initially consist of the Chinese yuan, the UAE dirham and the Russian ruble, according to the plan voted on.

The United Arab Emirates’ central bank took part last year in a trial of a Central Bank Digital Currency (CBDC) using mBridge technology directed by the Bank for International Settlements and looking at the potential use of CBDC’s for “international transactions.” The study’s participants also comprised “the People’s Bank of China (PBoC), the Bank of Thailand, and the Hong Kong Monetary Authority with participants hailing the results of the study,” according to Coingeek.

The third resolution was to set up an alternative to the SWIFT bank exchange. According to Investopedia, “The Society for Worldwide Interbank Financial Telecommunications (SWIFT) system powers most international money and security transfers. SWIFT is a vast messaging network used by financial institutions to quickly, accurately, and securely send and receive information, such as money transfer instructions. ”

Mohsen Karimi, the International Vice President of Iran’s Central Bank, said at the Tehran summit, “The interbank messenger replacing SWIFT will be implemented within the next month among the members of the Asian Exchange Union.” He said that Iran has designed a new exchange that will message members of the Asian Exchange Union’s banks and allow currency transfers among them. He said this method will be cheaper than SWIFT.

For many reasons, the dollar is likely to remain the world’s reserve currency for some time, and the SWIFT banking exchange will remain central. Still, it may be possible for this rival basket of currencies to replace the dollar in Asia for some purposes, and a new banking exchange that allowed South Asian countries to deal with Iran and Russia in ways that the US cannot easily sanction would have its attractions. It is certainly the case that Washington’s over-use of financial sanctions is likely sooner or later to cause other countries to move away from the US-dominated banking exchange and from the dollar, which is a Trojan Horse for the Office of Foreign Asset Control of the US Department of the Treasury.

(The Conversation) – To justify invading Ukraine, Vladimir Putin has painted Russia as a hegemonic power re-asserting its rightful claim to imperial greatness. Yet even before the invasion, Russia’s economic capabilities were hardly capable of sustaining an empire.

Now, with foreign sanctions presiding over a plummeting Russian ruble, Russia’s economic standing has fallen further still. If measured at today’s exchange rates, Russia’s economy would be the 22nd largest in the world, with a gross domestic product (GDP) not much larger than the state of Ohio’s.

That’s a far cry from the past, when Russia was a true world power. According to data assembled by the late economic historian Angus Maddison, it was the fifth largest economy in the world in 1913, behind the United States, China, Germany and Britain. By 1957, when the U.S.S.R. outpaced the United States to launch the first satellite into space, the Soviet economy was the world’s second largest after America’s.

Putin’s quest for greatness

Putin was elected president following the chaotic disintegration of the Soviet Union and the 1998 financial crisis in which Russia defaulted on its debt and abandoned its fixed exchange rate.

At the time, Russia’s market-value GDP had bottomed out at US$210 billion, making it the world’s 24th largest economy, behind Austria. (All contemporary GDP figures are from the October 2021 World Economic Outlook published by the International Monetary Fund.)

Putin established an informal social contract with the Russian people based on his ability to deliver strong economic growth. Under Putin’s rule, and buoyed by a commodity price supercycle that would stretch well into the 21st century, Russia’s GDP in market exchange rates rose tenfold, returning Russia to global relevance and providing purchasing power to its middle class.

However, Russia researchers argued that as Russia’s economy began to flag, from a peak in 2013, Putin sought new legitimacy to govern through foreign policy actions to re-establish Russia’s status as a “great power.” These efforts were epitomized by the Crimean annexation of 2014.

Russia’s invasion of Ukraine, against the backdrop of Russia’s market-rate GDP losing a third of its value between 2013 and 2020, represents a doubling down of Putin’s strategy to seek legitimacy from “great power status,” rather than economic performance.

Yet the West’s unrelenting financial and economic sanctions have only accelerated Russia’s economic downfall.

Russian stocks traded on the U.K. market have fallen by 98 per cent, wiping out US$572 billion of wealth, while stocks on Russian exchanges remain suspended.

The Russian currency has fallen to 155 rubles per dollar — a drop of more than 50 per cent from 75 rubles per U.S. dollar before the invasion. If not for recent captial controls and the rising prices of commodities — brought about by the sanctions themselves — that make up the majority of Russia’s exports, it would fall even further.

Domino effect

A country’s market-rate GDP is its GDP converted to a global currency like the U.S. dollar. While there are other ways to measure GDP, when it comes to global trade and investment — and economic power — the market rate is what matters.

Russia’s market-rate GDP in 2021 was US$1.65 trillion, enough to make it the world’s 11th largest economy, behind South Korea. If we crudely convert Russia’s 2021 estimated GDP by March 7, 2022, currency rates, rather than the average exchange rate used last year, and place it against the 2021 market-rate GDP table, the rankings change and Russia slides to 22nd place, falling between Taiwan and Poland.

This drop is likely an underestimate. While a falling ruble lowers Russia’s exchange rate of its GDP to U.S. dollars, its weakening economy lowers its ruble GDP directly. And Russia’s isolation will erode its economic competitiveness, widening the economic gap further in the medium term.

Ukrainians confronted with the oncoming Russian army were wise to Putin’s chimeric strategy. “Don’t you have problems in your country to solve? Are you all rich there, as in the Emirates?” one elderly man heckled Russian soldiers.

Putin’s next move

Robert F. Kennedy famously observed that GDP failed to account for many things that we care about — like health and education. The fall in Russia’s market-rate GDP cannot begin to describe the human tragedy playing out in both Ukraine and Russia.

But what these figures do make clear is that Putin’s claim to legitimacy through economic performance is all but destroyed. With “great power status” tied closely to economic power, Putin’s back-door source of legitimacy from stirring up nationalist pride now seems closed as well.

Putin may have led Russia from one “Times of Troubles,” but he has delivered it to another one. That’s cold comfort to the Ukrainians, and indeed to the rest of the world, who are wondering Putin’s next move.

Eric Werker, William Saywell Professor of International Business, Simon Fraser University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Featured image: Pixabay.

The Chinese press in Arabic said that the goal of the premier’s visit was to find ways of cooperating in the face of a global economic slowdown, an increase in bloc politics, widening wealth gaps, as well as escalating food and security crises.

According to BBC Monitoring, King Salman and Xi Jinping signed six major agreements fostering greater cooperation. One concerned an attempt to harmonize China’s Belt and Road Initiative and Saudi Arabia’s Vision 2030, an attempt to diversify the economy away from an over-dependence on petroleum exports.

Mohammed Bin Salman is well aware that the days of petroleum are numbered, and his Vision 2030 is intended to set Saudi Arabia on a sound post-oil footing by diversifying the economy and using the country’s sovereign wealth fund and vast currency reserves to fund this transition. Chinese investment and trade are viewed as important to the transition. For China to incorporate Saudi Arabia into its One Belt, One Road global transportation and trade infrastructure plan would help in this shift. Moreover, the Gulf Arabic press stressed, the GCC countries feel that in the past they have put too many of their eggs in the American basket, and they want to avoid depending so deeply on one superpower in the future.

Al Jazeera says that earlier on Thursday, Xi was welcomed by Saudi Crown Prince Mohammed Bin Salman, just before the convening of a summit between the two countries.

Xi Jinping will meet not only Saudi authorities but also those of the six-nation Gulf Cooperation Council (GCC) and thirty 30 heads of state or of international organizations. The Chinese delegation is expected to sign commercial and other agreements worth $30 billion.

Xi will meet on Friday with the GCC leaders (comprising Bahrain, Kuwait, Oman, Qatar,Saudi Arabia and the United Arab Emirates).

Xi said that he would work with the Gulf Cooperation Council to build a new, multi-dimensional relationship regarding energy and in the field of diplomatic partnerships.

For their part, Saudi authorities pledged to create a new regional center in Saudi Arabia for Chinese factories.

The two countries signed 34 investment agreements on Thursday in the fields sof green energy, technological knowledge, cloud services, transportation, construction and other sectors.

The Saudi and Gulf dedication to diversifying their economies, given the short timeline for the end of petroleum as a transportation fuel, has caused them to expand relations with China. This move has provoked fears in the United States concerning a growing partnership between Saudi Arabia and China in sensitive infrastructure in the Gulf.

BBC Monitoring reports that green hydrogen, the teaching of Chinese in Saudi Arabia, and incentives for mutual direct investment formed components of the deal.

(The Conversation) – Women from religious communities around the world, like the Dawoodi Bohras, are harnessing the potential of social media platforms to set up or expand their businesses and build entrepreneurial networks. The ease of access, wide reach and collaborative nature of these platforms is providing more women with financial opportunities previously unavailable to them.

Research shows that religion can impact women’s abilities to launch, operate and sustain a business. Religious attitudes towards entrepreneurship affect the support, financial or emotional, that women get from their families and communities.

But religious requirements can also provide the basis for entrepreneurship. Norms and customs around modesty or specific religious dress code can become valuable sources of income for female-led enterprises.

Yet, many women struggle to build businesses or form networks due to gender segregation rules that discourage working outside the home and make it logistically challenging.

Accessing opportunities

Using social media has helped many women navigate these issues by enabling them to conduct their business from the privacy of their homes. They have been proven to offer women more opportunities to connect personally and professionally.

The interactive nature of these platforms blurs social and geographical boundaries to form virtual communities. Through platforms, women can engage in dialogue and build networks of collaboration that provide support and feedback.

At the same time they can overcome many real-life difficulties and barriers. For many women, these virtual spaces compensate for the invisibility and lack of agency many of them often experience in professional contexts.

Online platforms help women balance their domestic and family responsibilities while enabling them to become financially independent. All-female platforms are created by traders to avoid the involvement and control of men which also helps them navigate the rules of gender segregation.

Many Orthodox Jewish women have used social media to build businesses and connections within their own communities while keeping in line with expectations around modesty. Women like Sarah Haskell, who goes by the handle @thatrelatablejew, create content that educates people about Judaism and also combats negative stereotypes about Orthodox Jewish women.

Muslim women all over the world also utilized the marketing potential of social media to create a modest fashion industry by reclaiming of the hijab. Many reappropriate symbols or phrases with negative connotations towards Islam such as “Muslim extremist” to sell t-shirts with the words “extreme Muslim” as a form of optimism-driven commodification.

They assert their identity while combating negative stereotypes about Islam and Muslim women. Entrepreneurial networks also function as a form of empowerment to overcome issues faced by them due to Islamophobia.

Bohra entrepreneurship

Dawoodi Bohras are a religious community known for their trading activities and entrepreneurial spirit. The community numbers around one million, living mainly in India with smaller diasporas around the world.

For Bohra women, work is a source of income as well as part of their religion and a way to give their lives meaning. This idea is based on historical examples of women such as the Prophet Muhammad’s wife Khadija who was known to be a tradeswoman as well as principles of equality that consider both men and women working together to ensure happiness and prosperity.

Traditionally, Bohra women would either market their products from home or operate physical stores. However, the rise of digital entrepreneurship allows them to expand online. Their ventures range from designing and selling the community’s unique religious dresses to accompanying accessories such as skullcaps, prayer mats, bags, jewelry as well as other items like food, toys, décor and religious teaching aids.

Some women sell exclusively online or as an extension of their physical businesses. They have their own websites or use different social media platforms and form online groups where women can interact, advertise their products and receive guidance and mentoring.

Support from community institutions is what differentiates Bohra women’s entrepreneurial activities on social media. Due to its entrepreneurial outlook and eager embrace of digital media, the community provides women with financial aid, online training and workshops and virtual bazaars which help them succeed.

During COVID-19 pandemic closures the community’s official business department, Al-Tijaarat Al-Raabehah, helped many entrepreneurs move to digital marketing.

The Dawoodi Bohra model shows how community support of digital entrepreneurship can help women achieve financial independence and success while respecting religious norms and beliefs.

Although these are small ventures in terms of demand and reach, social media platforms have helped Bohra women expand their realms of possibility and create strong networks across the globe.

Arwa Hussain, PhD Candidate & 2022-23 Concordia University Public Scholar, Concordia University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

As the devastation of climate change makes the need to decarbonise clearer by the day, countries face the question of what to do with their old fossil fuel infrastructure. While some environmental activists have taken to sabotaging the carbon economy on the back of its emissions in the Global North, the picture is different in oil-producing countries of the Global South, where energy infrastructure has fed communities for decades. There, the emphasis is placed on memory and institutionalisation.

Oil’s conquest of Iran and Malaysia

The cases of Malaysia and Iran, where oil has significantly contributed to economic growth, give us a glimpse into how authorities are currently reckoning with their fossil fuel heritage. In the 20th century, the arrival of international oil companies in the major port cities on the Persian Gulf in Iran and the South China Sea in Malaysia transformed the built environment, accelerated urbanisation and impacted peoples’ everyday lives. Even today, the dynamics and actors of oil in Iran and Malaysia continue to reshape industry, society, culture, and politics while leaving their mark on the built environment and urban spaces.

Founded in 1978, the International Committee for the Conservation of the Industrial Heritage (TICCIH) is an international organisation established to explore, protect, conserve and explain the remains of industrialisation. In 2020, it published the first global assessment of the heritage of petroleum production, the oil industry and the places, structures, sites, and landscapes that might be chosen to conserve for their historical, technical, social, or architectural attributes. In a 2020 report, the organisation defined the heritage of the petroleum industry as

“the most significant fixed, tangible evidence for the discovery, exploitation, production, and consumption of petroleum products and their impact on human and natural landscapes”.

Iran’s petroleum museums

Less than a decade ago, Iran’s Ministry of Petroleum began to consider establishing museums with a view to preserving the country’s industrial heritage. Those in the port city of Adaban in the country’s southwest, include an old refinery, gas station, and the oldest oil-related technical training school. In sections of the old ports, passersby can appreciate cranes and heavy machinery, such as the Akwan and Sulfur cranes, as well as an exhibition about the reconstruction of the refineries following the Iran-Iraq war (1980-1988).

The country is projecting to open other oil museums in major oil port cities. One of them is Masjed Suleiman, a city in the southwestern province of Khuzestan widely recognised as the birthplace of the oil industry in the Middle East. Its museum hosts the oldest oil recovery site in the region. In Tehran, the Museum of Oil Industry Technology will detail the nature and importance of oil, gas, and petrochemicals since 1901. It was in that year that the British speculator William D’Arcy received a concession to explore and develop southern Iran’s oil resources.

When the oil industry refuses to die

In Malaysia, the oil industry is omnipresent in everyday life, which raises challenges to global decarbonisation efforts. The national oil company Petronas is visible everywhere, from the dissemination of scholarships, the establishment of a university, and the iconic Petronas Twin Towers to the transformation of sleepy towns into sprawling industrial complexes. The industry goes back to the early 1900s, when oil was struck in the jungles of Miri, Sarawak, under British rule.

The conservation of Malaysia’s oil legacy has proven somewhat challenging, as most rigs are located offshore and sites still very much in use. Efforts have also been limited and lack a centralised plan. In a federal nation, each state dictates its own policies, which extends to museums. Under the Sarawak Tourism Board, the oil rig in Miri has been transformed into a museum and tourist site but remains the only one of its kind.

Conservation efforts have mainly focused on education with an emphasis on science and technology. Most attractions, such as the Petrosains Discovery Centre and the Petronas University of Technology, prioritise public awareness and learning. Malaysia’s national narrative is consistently upbeat – that the oil industry has improved society, transformed of remote villages, advanced educational opportunities, and led to dramatic changes in landscapes and cityscapes.

Toward post-pandemic and post-oil futures

Malaysia and Iran have taken different approaches when preserving the oil industry as part of their tangible and intangible cultural heritage. Nonetheless, a common element of is to separate the oil industry from its imperial pasts by preserving historical sites and narrating them as part of the national narrative.

For Malaysia, Petronas and the oil industry is promoted as a success story, intertwining petrol and nationalism. The preservation of the Miri oil rig as a tourist site serves the dual purpose of an attempt to safeguard the historical value of the location and to integrate it as a part of Sarawak’s story.

However, rising concerns about climate change, the environment, and corporate responsibility are increasing pressure on oil companies to reduce their carbon footprint by supporting clean and renewable energy, but these efforts appear to lag behind companies such as British Petroleum, which has moved into electric charging and renewable energy. Furthermore, the Covid-19 pandemic caused consumer demand for oil to plummet, which will likely continue to depress Iranian and Malaysian exports for the months to come.

The impact of the Covid-19 and climate crises

In the case of Iran, the Covid-19 crisis and the fluctuations in oil prices coincide with intensified sanctions by the United States against Iran, also known as the “maximum pressure campaign”. Despite its rich oil and gas resources, the country needs new technology investments and development plans to prepare for the post-fossil-fuel future. However, that will be hard to achieve without resolving US-Iran tensions and easing sanctions. To balance future economic growth with social development and environmental protection, Iran needs to invest more in plans for sustainable development and transition to less environmentally harmful energy sources.

Malaysia’s response acknowledges of the twin effects of Covid-19 and global warming: change in weather patterns and a decrease in demand for oil. Since the 2010s, there has been some movement in the energy sector to prepare for the post oil future. Over nearly a decade, Petronas has focused on solar power, wind energy and clean hydrogen, pledging to achieve net zero carbon emissions by 2050.

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But it took until 2020 amid the Covid-19 crisis and growing international awareness over the climate emergency for momentum to pick up. In 2021, the Ministry of Energy and Natural Resources set targets to decarbonise the country by 45% by 2030. While these efforts have been applauded, some hindrances remain, such as financial constraints and a lack of engagement with nongovernmental organisations.

Lessons from Malaysia’s palm oil heritage

Given changing global attitudes toward the oil industry, the question arises how the industrial heritage of Malaysia and Iran can be envisioned. Will oil rigs become relics of human greed instead of human advancement? And how will the national narrative reconcile this new reality with the importance of oil in the countries’ decolonisation process?

For Malaysia, it’s a question that has already been asked regarding palm oil and deforestation. Environmental activists in the country and abroad have highlighted their negative impact, which resulted in poor publicity for the country. However, through government engagement with youth and activists, there has been some improvement with how palm oil is viewed especially with regards to sustainability efforts.

Oil heritage perhaps needs to walk a similar path, encouraging honest conversations between policymakers, NGOs, industry stakeholders and historical organisations. The Covid-19 pandemic has also provided vital lessons and introduced new practices emphasising corporate responsibility toward workers. Improved governmental cooperation has also shown that it is possible to work toward common goals, which can be expanded to issues such as heritage. If implemented appropriately, such approaches may spell a bright future for how we view oil as part of a national narrative.

50th anniversary of the World Heritage Convention (16 November 2022): World Heritage as a source of resilience, humanity and innovation.

Rowena Abdul Razak, Guest Teacher in International History, London School of Economics and Political Science and Asma Mehan, Assistant Professor in Architecture and Urban History, Texas Tech University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

( Globalvoices.org ) – Whether on a date or at a family gathering, one topic of conversation is on everyone’s lips in Turkey: the country’s deepening economic crisis. There are several angles to the story. While Erdoğan’s government argues that the country is in an “economic war” against enemies, the opposition blames it on corruption fuelled by the leading party.

Inflation is soaring. Official estimates place it at 80 per cent, while independent economists believe it goes well above 150 per cent. In concrete terms, a cup of coffee at a café in Istanbul costs 36 lira — the equivalent of €2. While this might not sound like much for coffee drinkers in say, Greece or Germany, in Turkey, it’s a lot. The minimum wage in Turkey is €302 or around 150 coffees.

The causes for Turkey’s frenetic inflation vary, depending on who you ask. Turkey’s economic woes started a few years ago, but the COVID-19 pandemic hit the population and economy hard, and so has Russia’s war on Ukraine. Russia and Ukraine are among Turkey’s biggest trading partners and sources of tourism.

Even so, inflation in Turkey is faring worse than in these warring countries. Many Turks blame the plunging lira on Erdoğan’s government.

Turkey’s elections

Presidential and general elections are scheduled to take place in June 2023, but there is a chance that Erdoğan will call for early elections. According to our researchers, the electoral campaign will be defined by economic narratives: whichever party offers the most convincing storyline about the economic crisis and its solutions will increase its chances of ruling the country in the near future.

Erdoğan’s administration has kept interest rates low to continue to attract investments and save businesses. It has also put a 25 per cent ceiling on rent increases. However, this measure has proven difficult to implement for many people. Rent costs have still doubled (as seen on popular real estate websites). Distrust in the Turkish lira is spreading, leading to a downward spiral as the country gears up for elections.

Turkey’s media landscape

In Turkey, the media is tightly controlled and social media is monitored. Critics of the state “have been muted through a combination of traditional forms of censorship such as arrests, detentions, intimidation, (…) combined with a crackdown on the internet using high level opaque administrative and judicial decisions blocking, banning, and withholding online content,” according to Global Voices’ Unfreedom Monitor report. About a month ago, an investigation revealed that Turkey’s information and communication authority had collected private user data for over a year.

Mass media, therefore, follows the government line: that Turkey has a generally stable economy with some temporary problems. Questioning this stance might have consequences.

Although direct censorship has not been recorded, there is concern that Erdoğan’s party is introducing regulations to block “alternative statistics” — that have not been approved by the Turkish Statistical Institute (TÜİK) — by using prison sentences. This is important in today’s context, as the official inflation rate according to TÜİK is 79.60 per cent, whereas the independent Inflation Research Group (ENAG) says it is 176.04 per cent. TÜİK stopped sharing the list of items that it used to measure the inflation rate last May.

Opposing narratives

Narrative 1: “The Turkish economy is being targeted”

See this narrative analysis in our database here

Erdoğan’s government imagines itself to be in an economic war surrounded by enemy Western nations, who are often labelled as “imperialist” (even if the term isn’t explained). The enemy is painted as a dark and vague alliance of foreign “centers of power” and terrorists and, of course, the “treasonous” opposition in cahoots with all these evil entities. Narratives about external forces sabotaging Turkey’s economics and politics are not new and have been around for at least a decade, but they have intensified in the past months.

The accusations range from the reasonable to the fantastical. For example, members of the ruling Justice and Development Party (AKP) blame the opposition for painting an extremely ugly picture of the economy, which, it says, becomes a self-fulfilling prophecy because it erodes trust. Meanwhile, the AKP is also attempting to hold on to its dwindling voterbase with exciting and sensational stories about hidden powers conspiring against a strong Turkey. Erdoğan is the brave hero fighting against them alone.

How it’s seen on social media

On August 26, in response to a tweet by The Economist about Turkey’s “topsy-turvy” economy, Turkish Minister of Economy Nureddin Nebati claimed that Turkey’s economy is following a government program and that “no obstacle” will stand in the way. The tweet implies that The Economist is part of this “obstacle.”

Back in April, Erdoğan implied that a “power” is trying to hurt Turkey by hitting the economy and that it’s the same actors who have attempted to destabilize Turkey through military tutelage, coups and terrorism in the past. In November last year, pro-government journalist Karagül claimed that there is a “multinational operation” to create an economic crisis in Turkey.

Who “they” are is never directly stated, but only implied. Sometimes it is the Kemalist elite, sometimes opposition parties, sometimes Western countries, and most often, a combination of all of the above.

Narrative 2: “Corruption and nepotism have replaced meritocracy in state institutions”

See this narrative analysis in our database

The political opposition is accusing Erdoğan and the AKP of nepotism and overall inefficacy. The right-wing coalition, led by the Republican People’s Party (CHP), has vociferously blamed the ruling party for its lack of a general economic policy and for promoting corrupt bureaucrats and political allies who increasingly demand palm grease. This narrative is shared by anyone skeptical of Erdoğan’s governance.

There is an overall sense that the opposition — especially the CHP’s coalition — may have a chance of winning Turkey’s next elections.

Yet, economists warn that the opposition should resist the temptation to make populist promises to fix what is beyond its means, as many of the causes of the economic crisis lie beyond Turkey’s immediate control, such as foreign wars, global financial markets, and longstanding structural issues within the country.

Perceptions about corruption

Although economists and sociologists suggest that corruption is not the biggest issue for economic woes globally, the main opposition bloc is arguing that nepotism, a form of corruption, is indeed the source of most of Turkey’s problems. For our researchers, it is strategic rhetoric for the upcoming elections.

Our researchers have also anecdotally pointed out that, culturally, there is a certain tolerance among some sectors of the population for corruption, justified with arguments such as, “they stole but they served the country too”. But now that the vast majority of people are becoming strikingly poorer, nepotism in particular is being reprehended.

How it’s seen on social media

I filed a criminal complaint about the 56 tender of the General Directorate of Highways, to which the AK Party had connected a hose.
The current amount of 56 tenders delivered to the address by bargaining procedure, although the conditions specified in the law are not met:
95,808,900,620 TL!
Who are these companies? ⬇️

CHP lawmaker Deniz Yavuzyılmaz wrote a Twitter thread, backed up by supporting documents, exposing that a government directorate gave 56 state tenders to certain construction firms, allegedly without due process. Yavuzyılmaz is a young first-time lawmaker who has often pointed out corruption. Formerly, he also exposed bureaucrats receiving multiple salaries in an illegitimate fashion.

View our entire Turkey dataset

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Written byCivic Media Observatory

Via Globalvoices.org

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Ironically, Russia already seems to see Iran as one lifeline it could use to hedge against sanctions. Moscow is threatening to derail the Vienna negotiations seeking to bring the US back into the 2015 Iran nuclear deal unless it is guaranteed the same right to profit from a reemerging Iranian economy as everyone else.

So here are the paths Iran has taken around US boycotts and sanctions:

1. Faced with US third-party sanctions on anyone who bought Iranian petroleum without a Treasury Department waiver, Iran sold its petroleum to small private refineries in the south of China. These firms do no business with the United States or Europe and have no assets overseas that could be seized. They are private businesses and so their trade with Iran does not imperil large state companies like Sinopec. The trade goes on in soft currencies or Chinese yuan rather than in dollars, denying the Treasury Department any jurisdiction over it. Iran has also sold a lot of petrochemicals for e.g. fertilizer to various countries under the radar.

If Russia has trouble offloading its petroleum in Western markets because of US pressure, it will offer it at a discount to China with the same sorts of arrangements that make it difficult to punish China for the trade.

2. Iran ships the oil on disguised tankers flying third party flags that turn their Automatic Identification System, or AIS, off so that they cannot be traced as they go to Shanghai from Bushehr.

Such stealth tankers can also carry Russian petroleum.

3. Because trading in dollars could attract US sanctions, Iran resorted to other currencies. Tehran sold petroleum to India and accepted rupees for it. Rupees are a soft currency, meaning that no one but Indians really wants them. So Iran cannot buy goods from other countries with the rupees it accumulated. It has to buy Indian goods. Iran thus imported more from India. Likewise, Iran agreed to accept soft currencies from China in return for its oil. China has accumulated a lot of such bills from Africa and Asia and can unload them on Iran because the latter country is desperate. Again, if Iran gets Kenyan shillings, it has to import goods from Kenya with them. Still, Iran may be able to get some needed commodities from Kenya this way. Having to deal in soft currencies reduces the profits on Iran’s oil by perhaps 25%, but that is better than losing 100%.

Especially if Russia is kicked off the SWIFT bank exchange, Moscow would likewise probably have to start dealing in soft currencies for its oil trade, and would likewise suffer significant losses that way. It would, however, still sell enough oil and gas at a discount to stay in business as a country. More important to Putin is that the oil income would flow to him and his cronies, keeping them in power.

4. Iran dealt with other countries under US sanctions such as Venezuela. Washington has sanctioned Venezuela so heavily that there isn’t much else it can do to Caracas, so Venezuela has imported from Iran natural gas concentrates used as diluents, which are needed to refine petroleum into gasoline. Markets such as Venezuela, which is rich in petroleum but poor in methane gas, would also be open to Putin’s Liquefied Natural Gas exports.

5. Iran laundered money on a vast scale through banks in neighboring countries such as Dubai in the United Arab Emirates or Turkey. Russia will also seek out shady bank executives, including in Dubai, who will launder funds for it.

6. Iran protested the strangulation of its economy by targeting neighbors that helped the US enforce the US boycott. Thus, Iran or its allies were somehow responsible for a series of tanker fires in the Gulf that targeted UAE and Saudi ships, and even an Israeli one. Likewise, it or its allies were behind a devastating attack on Saudi Arabia’s Abqaiq oil refinery complex in September, 2019. Iran carried out or instigated this sabotage cleverly, with plausible deniability. This endangerment of their oil proceeds likely made Abu Dhabi and Riyadh more open to negotiating with Iran and caused their lobbyists in Washington to soften their hard line in favor of sanctioning Iran to the hilt.

The analogy should be clear. Russia’s pro-American neighbors such as Poland could see Russian terrorism in response to smothering sanctions, but it would be carried out wearing gloves and leaving no fingerprints.

7. Iran continued to offer neighbors the help of its Iranian Revolutionary Guards Corps special operations forces, cultivating soft power this way in Iraq, Syria, Lebanon and to a lesser extent Yemen. The US could not sanction Iran into geopolitical irrelevancy.

Russia has already deployed Wagner Group mercenaries somewhat in the way that Iran uses the IRGC Jerusalem Brigade, and loaned its Aerospace Forces to Syrian dictator Bashar al-Assad to put down the Syrian revolutionaries. We could see Russia making some money in this way, or at least remaining a power to be reckoned with.