Turkey, Iran Seek Better Ties

The Wall Street Journal Europe (USA) June 10, 2014, p. 5

By Joe Parkinson, Istanbul

Turkey and Iran signed several economic cooperation agreements and pledged to improve relations that have been fraught for years, largely because of deep differences over Syria and Iraq.

The two-day visit by Iran’s President Hasan Rouhani, who was elected in a landslide last year, was the first by an Iranian leader in 18 years. It follows a trip in January by Turkish Prime Minister Recep Tayyip Erdogan to Tehran, where he signed a preferential trade agreement.

Ten deals were signed Monday in Ankara on energy and trade, including lucrative construction contracts for Turkish companies, aiming to double trade between the neighbors to $30 billion by the end of 2015.

The Iranian president, who has sought to ease Tehran’s international isolation with a foreign policy of « prudence and moderation, » also pledged to work with Ankara to bolster regional security. He called the meeting a turning point in relations.

« There is instability in our region and this situation is in no one’s interest. Iran and Turkey are determined to increase their cooperation to establish safety and stability in the region, » Mr. Rouhani said in a joint news conference with Turkey’s President Abdullah Gul.

« Our relations are not just about two countries. They are important for the region and the whole world, » Mr. Gul said.

In a move that could significantly benefit Turkish consumers, Mr. Rouhani said the delegations were discussing lowering the price for Iranian natural gas. Ankara has repeatedly called for a discount, enshrined in a 1996 contract, complaining that Iranian gas is too expensive compared with other suppliers like Russia and Azerbaijan.

« I hope our ministers will close the deal fast, » Mr. Erdogan said at a news conference with Mr. Rouhani.

Iran and Turkey, important trading partners but also rivals for regional influence, have long been at odds over a host of regional security issues including strident differences over the three-year-old conflict in Syria.

Shiite Tehran has strongly backed its longtime ally President Bashar al-Assad since the start of the uprising against him. Predominantly Sunni Turkey, meanwhile, has been one of Mr. Assad’s fiercest critics, supporting his opponents and giving refuge to rebel fighters.

In Iraq, Iran is seen as a sponsor of Prime Minister Nouri al-Maliki, whom Turkey has accused of pursuing a sectarian agenda. Mr. Maliki has accused Mr. Erdogan of meddling in Iraq’s internal affairs and objected to Ankara’s strong backing of the semiautonomous Kurdish regional government in northern Iraq and its push for self-rule.

But political analysts said that Monday’s visit underscores how the two regional heavyweights are seeking now to keep differences from preventing progress in other areas.

Iran is seeking a bigger share of Turkey’s fast-growing energy market, while Turkish firms want a green light to expand in a country of 76 million people with some of the world’s biggest oil-and-gas reserves.

« There is a clear mutual interest here, » said Aaron Stein, associate fellow at Royal United Services Institute, a U.K.-based think tank. « They are trying to compartmentalize their problems and focus on areas where there is agreement, but there are limits to what they can achieve. »

Mr. Rouhani’s visit takes place as Iranian, U.S. and European Union officials hold talks in Geneva about Tehran’s disputed nuclear program. The parties signed a preliminary deal in November, under which Iran accepted to halt some sensitive nuclear activities in exchange for partial easing of sanctions.

The rapprochement could intensify long-held concerns in the U.S. that Turkey, a North Atlantic Treaty Organization member, is a weak link in the international sanctions regime. Washington is still warning countries that the U.S. Treasury will sanction firms doing business with blacklisted firms, even if negotiations are taking place.

Monday’s fraternal rhetoric in Ankara marks a stark reversal from 18 months ago, when Mr. Erdogan publicly slammed Tehran for its support for Mr. Assad.

On Saturday, Mr. Erdogan told Turkish exporters to capitalize on the opening up of the Iranian market. He criticized Western governments that he said took a hard line on sanctions but allowed some of their companies to do business in Iran.

« Today, while products of the West and the developed countries are going into Iran in one way or another, why don’t our products go into Iran? It is an important market for us, » the premier said.

In years past, Turkey and Iran repeatedly pledged to bolster trade, but geopolitics interjected. In 2010, before the Arab Spring, Mr. Erdogan vowed to triple trade with Tehran and help Turkish companies capitalize on the market’s potential.

« Both of these countries have reached out to one another because they need partners, but their differences are not limited to Syria. They have very different approaches to what goes on in Iraq and Israel and a host of other regional issues and that limits the scope for a quick blossoming in ties, » said Soli Ozel, professor of international relations at Kadir Has University in Istanbul.

Iranian President Hasan Rouhani’s recent trip to Turkey was the first official visit by an Iranian leader to the country in 18 years. A Europe News article Tuesday about the trip incorrectly called it the first visit. Former President Mahmoud Ahmadinejad went to Turkey in 2008 and 2009, but neither was an official visit.