Turkey and Eurasia: Opportunities and Risks in the Caspian Pipeline Derby.

• Author: RUSECKAS, LAURENT

"In the decade ahead, Turkey will continue to face geo-political uncertainty in its relations with Russia and the Caspian Sea region, driven until now by the contentious interaction between Russian and US policies in the Caspian region."

Turkey's international relations have gone through many dramatic changes in the past decade, but none so striking as the transformation of its relationship with the former Soviet Union. The collapse of the USSR and the independence of its 15 successor states have brought Turkey both opportunities and risks to its North and East. Thus far, Turkish engagement in post-Soviet Eurasia has brought substantial benefit to the Turkish economy as well as something of a boost to Turkey's geo-political significance and prestige.

However, the transformation of the former Soviet space has not yet run its course, and the balance of power in Eurasia remains fundamentally unsettled. In the decade ahead, Turkey will continue to face geo-political uncertainty in its relations with Russia and the Caspian Sea region, driven until now by the contentious interaction between Russian and US policies in the Caspian region. At the same time, a rise in Turkey's economic links with both Russia and the Caspian states seems likely. If Turkey is able to pursue a balanced and moderate policy in Eurasia, it should be able to realize further economic benefits through trade and investment--while also helping to reduce the chances of a deterioration in the region's geo-political climate.

The specific geo-political danger for Turkey is the growing strategic competition between two emerging blocs centered on the Caucasus. Azerbaijan and Georgia, still feeling threatened by their large, unsteady and assertive neighbor to the North, have sought to guarantee their independence from Russia by aligning themselves with Turkey and the US. In an effort to stem this decline in its influence over the South Caucasus, Russia has deepened its informal partnership with Iran and Armenia, each of which has its own reasons for cooperating with Moscow. The situation has not yet reached the point where it poses an imminent threat to security and stability in the region. However, the coalescence of these states into two blocs has prevented the emergence of anything resembling a geo-political equilibrium in and around the Caucasus. Today's trends could hold the seeds of confrontation in the region--one in which Turkey would be centrally and unavoidably involved.

Ironically (though perhaps inevitably), the chief area of geopolitical contention is also the one which holds the greatest prospect for regional economic gain--the energy sector. Russia and the Caspian region will be crucial in providing the natural gas that Turkey needs to support rapid economic growth. The participation of Turkish companies in the Caspian oil and gas boom also offers tremendous opportunities for the Turkish private sector as well as the state oil company, Turkish Petroleum (TPAO).

At the same time, the debate over new pipeline routes for the export of oil and gas from the Caspian has become a focal point for the strategic competition mentioned above. The politicization of the pipeline issue has helped to create and solidify the two opposing blocs, and it has contributed to tensions in Turkish-Russian relations--while also increasing uncertainty and political risk in the Caucasus. In the next 12 months, commercial factors resulting from the ongoing push of the Caspian states and their foreign partners to develop and export oil and gas should go a long way toward clarifying the pipeline situation in the Caspian. For Turkey, the challenge during this period will be to keep the focus on economics and environmental concerns without allowing itself to be drawn toward incautious rhetoric and political confrontation.

This paper surveys Turkey's relationships with the Caspian region and Russia and, in particular, its role in the politics and economics of regional energy development. It begins by explaining how today's situation came to pass, focusing on the evolution of Turkish policy and its interaction with the diverging interests of the US and Russia in the Caspian. It then highlights the key issues for the medium term and their impact on Turkey The conclusion suggests a few guiding principles for future Turkish policy

THE EARLY 1990s: OZAL's ACTIVIST FOREIGN POLICY

The breakup of the Soviet Union in 1991 came on the heels of a series of events that transformed the context for Turkey's international relations. The end of the Cold War in 1989 began the process. For nearly 40 years, Turkey's place in the world had been defined primarily by its membership in NATO and its crucial geographic position on the USSR's southwestern flank. Suddenly, the Soviet threat had receded, and the future of the NATO alliance and Turkey's role within it became uncertain. This sense of insecurity was compounded by the decision of the European Community to reject flatly Turkey's application for membership in 1989. Although this decision did not come as a great surprise to the Turkish political elite, it did seem to confirm their fears that Europe was closing the door on Turkey now that its Cold War security contribution was no longer, needed.(1)

Turkey's president at the time, Turgut Ozal, reacted by pursuing an activist foreign policy that was intended to demonstrate Turkey's continuing importance to the West. He was presented with a golden opportunity to do this in August 1990 with Iraq's invasion of Kuwait. Despite serious opposition from public opinion as well as much of his own government, Ozal gave strong rhetorical and practical support to the US-led response against Iraq.(2) Meanwhile, President Ozal's sight also turned to the former Eastern Bloc. In 1990, he proposed the establishment of the Black Sea Economic Cooperation (BSEC), a multilateral organization which had the goal of encouraging trade and investment among the five states of the Black Sea littoral--the Soviet Union included.(3)

The breakup of the USSR at the end of 1991 added a complex new twist. Suddenly, the southern tier of the former Soviet space was home to five newly independent states with cultural and linguistic links to Turkey: Azerbaijan, Kazakhstan, Uzbekistan, Turkmenistan and Kyrgyzstan. Again, Ozal's impulse was to move quickly and assertively--this time with the strong support of the Turkish public, which had greeted the emergence of these new Turkic states with emotion and optimism. Turkey became the first country to recognize their independence formally, and in October 1992 Ozal hosted their presidents in Istanbul for an inaugural Turkic Summit. Air routes and a satellite broadcast link were established, and a new agency (the Turkish International Cooperation Agency; or TICA) was set up to oversee the transfer of billions of dollars in Turkish aid and investment promised to the region. TICA's first director went so far as to proclaim the Turkic states of the former Soviet Union to be Turkey's "near abroad"(4)--a direct challenge to Russian policymakers who had coined this term to emphasize the predominant role that Russia intended to play within the former Soviet Union.

Among Ozal's various foreign policy initiatives in the post-Cold-War period, his pursuit of partnership with the Turkic states of Central Asia and the Caucasus represented the most radical departure from traditional Turkish policy. The quixotic (and ultimately doomed) efforts of Enver Pasha to unite the world's Turkic nations during the dying years of the Ottoman Empire had helped convince Mustafa Kemal Ataturk, the founder of the Turkish Republic, that pan-Turkic adventurism would be a counter-productive and even dangerous policy for the new Turkish state. This was particularly true given the high priority that Ataturk placed on enhancing Turkish security by building a stable working relationship with the Soviet Union. Explicit disinterest in the affairs of the Turkic peoples of the USSR became one of the core principles of the Kemalist philosophy that guided policy for Ataturk's successors. President Ozal had already challenged the Kemalist orthodoxy in a number of other spheres. Now, with his activism in the Turkic world, Ozal again charted a new post-Kemalist course for Turkey--one which raised the possibility of strategic competition in the region with a weak and disoriented Russia.

AMBITIONS VS. REALITY

The high point of Ozal's Turkic policy came in May-June 1992 with the rise to power in Azerbaijan of the Azerbaijani Popular Front (APF) under the leadership of Abulfez Elchibey. The APF was the focal point for anti-Russian sentiment in Azerbaijan, and it professed a strongly pro-Turkish ideology.(5) Elchibey's election as president thus seemed to confirm Ozal's vision. But quickly--even before Ozal's sudden death in April 1993--it became clear that Turkey's aspirations in the region would need to be scaled back significantly Azerbaijan's overriding concern at this time was the conflict in its Armenian-majority Autonomous Region of Nagorno-Karabakh, which was going badly Starting in 1988, Nagorno-Karabakh's Armenian majority began to agitate for separation from Azerbaijan and union with next-door Armenia. A low-level conflict that began during the final years of the USSR became a full-fledged war by 1991, with Armenia fully engaged in support of its co-ethnics within Azerbaijan. Russia continued to play a significant background role in the conflict after 1991, largely through military support for the Armenian side.(6) The new APF government had high hopes that Turkey could provide serious support for its war effort. But once Russia made it clear that any hint of Turkish intervention would open the door to direct Russian-Turkish confrontation, Ankara backed off, restraining its role to one of diplomatic and limited economic support for Azerbaijan coupled with economic pressure on Armenia. By June 1993, the...