ANALYSIS
"Kurds suffer as Iraq, Turkey fail to restart oil flow ahead of Turkish FM's Baghdad visit" by Amberin Zaman, Al-Monitor
Iraq and Turkey failed to agree on the resumption of oil exports via the southern Mediterranean port of Ceyhan as Turkish Foreign Minister Hakan Fidan makes his first trip to Baghdad since assuming the post.
News of the deadlock followed talks in Ankara Monday between Iraq's Oil Minister Hayan Abdel-Ghani and his Turkish counterpart, Alparslan Bayraktar.
It is widely acknowledged that the real reason for Turkey's reluctance to reopen the line is Baghdad's refusal to waive the $1.5 billion fine from the ICC and to drop a second arbitration case covering KRG sales between 2018 and 2022.
Sources familiar with the negotiations who spoke on condition they not be identified said that Iraq's top ask was more water from the Euphrates and Tigris rivers, which originate in Turkey.
Regional officials familiar with the deliberations say Iran, which exerts strong influence over the Sudani government, is among the reasons that Baghdad is not agreeing to Turkey's terms for resuming oil exports. Iran is seeking to squeeze the KRG, which hosts Iranian Kurdish guerilla groups, saying the latter should be disarmed immediately or face further attacks.
"Turkey's Halt on Iraqi Oil Exports Is Shaking Up Global Markets" by Emir Gurbuz, Foreign Policy
Even though Turkish President Recep Tayyip Erdogan was rumored to make a historic diplomatic visit to Baghdad this month to discuss restarting the oil pipeline, the economic, political, and legal ramifications of the oil dispute are mounting as millions of barrels of oil remain stuck in ports—despite Turkish Foreign Minister Hakan Fidan's recent visit to Baghdad, where he did not publicly acknowledge the oil blockade.
Turkey's prolonged block on Iraqi oil exports and attempts to pressure Iraq to comply with its demands is destabilizing a pipeline of central importance to regional and global economic stability. The pipeline was carrying some 10 percent of overall Iraqi exports, amounting to 0.5 percent of global production—Iraq is the second-largest OPEC producer. Turkey's cessation of the exports immediately bumped up global oil prices above $70 a barrel. Moreover, oil export revenues account for some 80 percent of the KRG's annual budget, putting the entire administration in jeopardy.
As the blockage has continued, choking global crude supply, it has helped contribute to increasing oil prices, especially affecting the European Union, which had dramatically increased its imports of Iraqi oil to replace Russian gas. Italy, for example, satisfies 13 percent of its crude oil demand from Iraq, with more than half of it coming from KRG-controlled northern Iraqi fields. With the KRG oil flow cut off, Europe is in a precarious situation with no quick and easy solution.
"How Turkey's opposition elite enabled Erdoğan and misled voters" by Sinan Ciddi, Global Voices
Ahead of and during the general elections held in Turkey in May 2023, many of the influential opposition media outlets, with their commentators and journalists, were in a state of euphoria. Many respected analysts abandoned their objective analytical toolkits and lenses to cheer for the main opposition candidate who ran against Erdogan: Kemal Kilicdaroglu. Kilicdaroglu's candidacy was essentially forced upon the public by Kilicdaroglu himself and his narrow group of political operators, with little debate, public input.
Instead, the opposition intelligentsia helped to cement a widespread view that Kilicdaroglu was the man to defeat Erdogan. Meanwhile, those who questioned this decision were cast out as pariahs who could not read the writing on the wall. Seasoned analysts would engage in targeted campaigns that declared that the Erdogan era was finished and he had no chance of surviving reelection.
In the end, the skeptics got it right. What is troubling is that, while the predictions of journalists, pollsters, and analysts can be wrong, it was the marginalizing tone and the refusal to take critical analyses that presented credible alternative scenarios to the public into account.
Almost three months since the election, these pundits, rather than acknowledging that they misled the public, have only accepted that they were wrong and that it was time to move on and remain optimistic.
POLITICS
Top Turkish judicial body changes Istanbul Mayor's Appeal Court Committee
On August 25, the Council of Judges and Prosecutors (HSK) removed the chairman and a member from the 24th Criminal Chamber of the Istanbul Regional Court of Appeals, which oversees the appeal process for the conviction of Istanbul Mayor Ekrem Imamoglu for "insulting the members of the Supreme Election Council."
Imamoglu was sentenced to 2 years and seven months in prison on December 14, 2022, with a political ban. His legal team appealed the decision.
The HSK's decision involved replacing two members of the three-person committee responsible for decisions by simple majority. The review of Imamoglu's appeal is ongoing, and the replacements are expected to expedite the case.
Opposition parties plan to announce their candidates for local elections
Meral Aksener, the leader of the right-wing nationalist Good Party, held a rally in Afyonkarahisar on August 26, discussing the 2023 election loss and outlining the party's path forward, including plans for the 2024 local elections.
Aksener stated they gathered to start a new journey, reflecting on the election results over the past 90 days. She emphasized she intended to win the parliament and presidential elections last May and expressed regret for those who didn't share the same commitment without explicitly mentioning any names.
Aksener also criticized the alliance system, mentioning that it harms Turkish politics and benefits the ruling AKP. She declared the party's intention to participate in the upcoming local elections with their members.
Felicity Party Chairman Temel Karamollaoglu declared the party's intention to nominate its candidates in every province and district for the upcoming local elections. During a televised broadcast, Karamollaoglu stated that the party is actively preparing for the elections, demonstrating a dedicated effort in selecting candidates across all provinces, districts, and towns.
HDP appoints new co-chairs as operations move to Green Left
In response to the potential closure by the Constitutional Court, the Peoples' Democratic Party (HDP) has shifted all operations to the Green Left Party. The decision was formalized on August 27 during a party congress in Ankara.
At the same event, Sultan Ozcan and Cahit Kirkazak were named as the new co-chairs, replacing Pervin Buldan and Mithat Sancar, who had decided not to lead the party again after the elections. Given that all HDP activities now fall under the Green Left, the new co-chairs will have a symbolic role.
ECONOMY
Turkish Presidency's public procurement budget soars 20-fold in H1 2023
During the first half of 2023, Turkey's Presidential Complex allotted 1.08 billion Turkish liras ($39M) for public procurement, a 20-fold increase from the 45 million liras spent in 2022. This information was analyzed by Ali Mahir Basarir, a member of the main opposition Republican People's Party, based on a recent report from the Public Procurement Authority. The Presidency conducted 306 public procurements in the first half of 2023, compared to 241 throughout 2022.
Basarir also highlighted that in the first six months of 2023, all public institutions carried out 39,811 public procurements, amounting to 892 billion liras ($32.8B). Half of this year's tenders were conducted through closed procedures, with details not open to the public.
Collective bargaining talks end without agreement on salary increase
Ongoing negotiations since August 1 between the Public Employers Committee and the Confederation of Public Servants Trade Unions (Memur-sen) for a general salary increase in the 2024-2025 period have not resulted in an agreement.
Despite disagreeing on the increase rate, the parties managed to reach agreements in 11 service branches during their last meeting on August 22.
As no compromise was reached, the Public Officials Arbitration Board will decide the salary increase. Comprising 11 members from various fields, including the judiciary, bureaucracy, trade unions, and academics, the Board will make its final decision by August 31st. The decision of the Board will be legally binding.
Turkey raises interest rate to 25% in a surprise move
In a surprising decision, Turkey's central bank increased its key interest rate by a significant 750 basis points to 25% on August 24. This unexpected move signals a fresh commitment to tackle rising inflation as part of a broader change in policy direction.
This adjustment also sets the policy rate at its highest level since 2019. Since June, the central bank has raised its one-week repo rate by 1,650 basis points.
The policy committee reiterated its commitment to tightening policy "as much as needed in a timely and gradual manner" to address high inflation, which reached almost 48% last month.
JPMorgan revised its forecasts following the bank's substantial 750 basis points interest rate increase. The investment bank now expects interest rates to rise by 250 basis points at each central bank meeting until the year's end.
JPMorgan analysts also updated its end-of-year projection to 35% instead of 30%. Furthermore, analysts revised their year-end inflation forecast to 62% from 57%.
Hungary's MVM to purchase gas from Turkey's BOTAS
Hungarian energy company MVM plans to purchase around 300 million cubic meters of natural gas from Turkish firm BOTAS. "The agreement was reached during Turkish President Erdogan's recent visit to Hungary and is set to be finalized by year-end," said Hungarian government spokesperson Zoltan Kovacs on Twitter.
According to a statement from BOTAS, this deal is groundbreaking as it marks Turkey's first gas export agreement with a non-neighboring nation.
FOREIGN POLICY
President Erdogan criticizes UN peacekeepers' intervention in Cyprus
Turkish President Erdogan said on August 21 after the weekly cabinet meeting that the recent physical intervention of United Nations peacekeepers in roadworks in the southern part of ethnically divided Cyprus is unacceptable.
Conflict arose on August 18 when UN peacekeepers clashed with Turkish Cypriot security personnel while trying to halt road construction in an area the UN considers a buffer zone under its jurisdiction.
Turkish Cypriot authorities argue that the peacekeeping force, known as UNFICYP, went beyond its jurisdiction. Additionally, Turkish Cypriot leader Ersin Tatar emphasized the importance of the road project.
Turkish drone strikes kill seven PKK members in northern Iraq
Seven Kurdistan Workers Party (PKK) members, including two medical personnel, were killed by Turkish drone strikes on August 24 in Iraq's Erbil province. The counter-terrorism service reported that three PKK fighters died in a drone strike on their vehicle in the Sidakan district. Later that day, another drone strike in the same area killed four more PKK members, including the two medical personnel.
These strikes coincided with the visit of Turkish Foreign Minister Hakan Fidan to the region. During his visit, Fidan met with top Kurdish officials, including President Nechervan Barzani and Prime Minister Masrour Barzani. Earlier, on August 22, Fidan, in a joint press conference with his Iraqi counterpart, called for Iraq to designate the PKK as a terrorist organization.
Ukrainian President meets Turkish foreign minister amid Black Sea tensions
Turkey's Foreign Minister Hakan Fidan visited Kyiv on August 25 to meet with Ukrainian President Volodymyr Zelenskyy and other high-level officials. The aim was to mediate between Ukraine and Russia for a crucial Black Sea agreement on grain exports.
During their meeting, Zelenskyy said they discussed several matters, including Ukraine's stance on potential peace with Russia and efforts to organize a peace summit.
Although the Turkish Foreign Ministry didn't share specific details, they released images of the Kyiv meetings where Fidan also met with Ukrainian Prime Minister Denys Shmyhal.
After the discussions, Shmyhal highlighted talks on Ukraine's reconstruction and economic collaboration between the countries.
Fidan is anticipated to visit Russia following his trip to Ukraine, as announced by Turkish President Recep Tayyip Erdogan. Russia confirmed the upcoming meeting, although no precise timeline was given.
Additionally, the Kremlin announced that Presidents Erdogan and Putin are expected to meet in the coming weeks.
Greek Foreign Minister to visit Ankara for talks on bilateral and regional issues
The Turkish Foreign Ministry announced on August 27 that Greek Foreign Minister George Gerapetritis will visit Ankara on September 5th.
Gerapetritis will be the guest of Turkish Foreign Minister Hakan Fidan for a working visit. The two ministers are scheduled to discuss bilateral relations, regional matters, and preparations for a cooperation meeting covering economic, trade, transportation, energy, and other aspects.
Key topics on the agenda include maritime boundaries in the Aegean and Eastern Mediterranean, the Cyprus issue, and other regional concerns, including the ongoing Russian occupation of Ukraine.
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