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Wednesday, 29 October 2014 14:30

TANAP has added a new and dynamic dimension to the strategic partnership - Ambassador Extraordinary and Plenipotentiary of Turkey Alper Coskun Featured

Caspian Energy (CE): Mr. Ambassador, how do you evaluate the development of economic relations between Azerbaijan and Turkey?

Alper Coskun, Ambassador Extraordinary and Plenipotentiary of the Republic of Turkey: One can only be proud of the development in economic relations between Turkey and Azerbaijan in the past 20 years. Indeed, the numbers speak for themselves, particularly as far as our commercial interaction and respective investments are concerned. Yet I should also quickly add that while much has been achieved, there is yet great untapped potential. With this understanding, we are actively working to further deepen our cooperation in a manner that will benefit not only Azerbaijan and Turkey, but the region at large. I am very optimistic in this regard. First and foremost, Azerbaijan and Turkey are two brotherly nations that share a common history. Our bilateral relations are exemplary in all walks of life. This constitutes a perfect foundation to embark upon further cooperative schemes. As such, Turkey and Azerbaijan are the driving force behind enhanced economic cooperation and development in the Southern Caucasus. Together, with the support of other partners in the region, Georgia being the most notable, we are shaping a brighter future for this part of the world in a manner that has the potential to benefit all.

Turkey and Azerbaijan are two dynamic countries that enjoy political stability and have thriving economies. This is in stark contrast to slumping economic performances in many parts of the world that is also fraught with increasing uncertainties. In a matter of ten years, between 2003-2013, our bi-lateral trade volume has increased more than 10 times, from 438 million USD to 4.7 billion USD. We intend to further multiply this figure, to 15 billion USD, by 2023. As an energy dependent country with a flourishing economy, Turkey’s potential for imports from Azerbaijan is very high. On the other hand, the steady increase of the level of income in Azerbaijan presents great opportunities for Turkish exporters and investors.

Moreover, the nature of our economic relations is steadily widening in scope, particularly as far as mutual investments are concerned. Turkish investments in Azerbaijan have reached more than 8 billion USD and Turkish Petroleum has recently become the second biggest investor in the Sahdeniz-II project and the Southern Caucasus Gas Pipeline. Azerbaijani investments in Turkey on the other hand are currently around 4 billion USD, and are on the rise. The STAR refinery which will be built in Aliağa/İzmir by SOCAR valued at 5.5 billion USD should be cited in this context. Turkey granted the first ever ‘‘strategic incentive certificate’ to this project, as a sign of its full commitment and support to this investment. Furthermore, in the past decade Turkish contractors have undertaken projects valued at more than 9 billion USD in Azerbaijan. Only in the first half of 2014, Turkish companies were granted 13 projects valued at 1.8 billion USD.

Azerbaijan is implementing a national industrialization strategy aimed at diversifying the economy and decreasing its reliance on the energy sector. The establishment of industrial zones and techno-parks, private-public projects and technological cooperation between universities and industry, coupled with reform in many sectors, including in agriculture are basic pillars of this strategy. We believe that this ambitious and well thought out strategy will yield good results and are actively working to bring Turkish and Azerbaijani stakeholders together to share experiences and build synergy, where possible.

The business circles in Turkey and Azerbaijan both expect our respective Governments to provide an atmosphere conducive to greater economic collaboration and our political leaders have a shared vision to this end. As such we are constantly looking for ways to make this possible. Two ideas that we are focusing on are related to concluding a bi-lateral preferential trade agreement, and facilitating travel and customs procedures between our two countries. The potential and will to do more between Turkey and Azerbaijan is evident and I am confident that we will see steady progress in all fields of our bilateral economic cooperation.

 

CE: Does Turkey plan to change strategic objectives of economic development?

Alper Coskun: Our main goal is to continue growth in a steady and sustainable manner, with due regard to social and environmental factors. Turkey has the economic and industrial capacity, as well as a strong human resource base with proven entrepreneurial skills and dynamism to do this. The goals that we have set for 2023 as the 100th anniversary of the founding of our Republic are ambitious, but attainable. Our desire is to join the ranks of the top 10 economies in the world by attaining a GDP of 2 trillion USD, GDP per capita of 25.000 USD, and exports around 500 billion USD.

Turkey’s track record for the past 10 years has been outstanding. And we have achieved this against the backdrop of a global economic crisis during which the Turkish economy has displayed strong resilience. This performance naturally has not been coincidental. Behind this success are sound macroeconomic strategies, prudent fiscal and monetary policies and structural reforms that we have been persistently implementing. This mix of measures and policies has resulted in high rates of growth and increased confidence in the Turkish economy. While structural reforms strengthened the macroeconomic fundamentals of Turkey, our economy grew at an average of 5.2 percent over the past 10 years, namely between 2002- 2012. Accordingly, Turkish GDP went beyond 231 billion USD in 2002, to 820 billion USD at the end of 2013. We wish to continue this trend. Though economic theory suggests that the next leaps we wish to take may be even harder to achieve, we are confident that even if the road ahead is tough, Turkey can and will push forward!

 

CE: Which Opportunities will open for cooperation after the implementation of TANAP project within the framework of Southern Gas Corridor?

Alper Coskun: TANAP constitutes the backbone of the Southern Gas Corridor. Azerbaijan has a long history in terms of being a reliable partner in energy projects, both for Turkey and the international community at large. TANAP will further strengthen Azerbaijan’s role in this regard and we are proud to be a major actor in this historic project. Turkey is currently the second biggest foreign investor in Sahdeniz II after the British company, as well as in the Southern Caucasus Gas Pipeline, and is second to SOCAR in terms of investment in TANAP. All these are a natural result of our ambition to work with our partners in realizing the southern gas corridor, most notably with Azerbaijan and SOCAR, as well as our firm conviction in the success of this endeavor. The project is being implemented as planned and it is most evident that TANAP will become yet another exemplary manifestation of successful cooperation heralded by Turkey and Azerbaijan. Thereby, we will add another dimension to our energy cooperation with Georgia and Azerbaijan, after the Baku-Tbilisi-Ceyhan (BTC) oil and the Baku-Tbilisi-Erzurum (BTE) gas pipelines.

TANAP will have major positive consequences in many respects. First of all, the mere implementation of the project will spur significant economic activity and therefore growth in the respective countries. Once implemented, it will constitute a secure gas delivery route for Turkey, the Balkans and Europe. In other words, it will become an additional critical lifeline between Azerbaijan and Europe. Moreover, the demand side of these sales will benefit from a secure flow of gas, while Azerbaijan will be able to obtain the much needed revenues to continue its record breaking levels of growth and transformation.

TANAP has added a new and dynamic dimension to the strategic partnership between Turkey and Azerbaijan. When considered together with previous energy projects, as well as the soon to be completed Baku-Tbilisi-Kars railway, these projects will allow Turkey and Azerbaijan to be identified with the most groundbreaking and successful projects in this part of the world. At a time when uncertainties and immediate threats and risks are many, the successful implementation of such projects constitute not only a great example, but also bring hope for the future. They are also a good incentive for the Southern Caucusus to be defined not by aggression and invasion, as is the case in Nagorno Karabagh, but more so by mutually beneficial cooperative schemes.

Lastly, one should not forget the strategic goal of transporting trans-Caspian gas supplies through TANAP. This is also a rational and mutually beneficial idea that can and should be made a reality.

 

CE: Baku-Tbilisi-Kars railroad will open a new transit line. How do you evaluate the transit potential of the corridor?

Alper Coskun: The Baku-Tbilisi-Kars (BTK) railway will be a major transit corridor in the form of an integrated railway network between Europe and Asia. In essence, it is the reincarnation of the ancient Silk Road, in modern form. Together with the recently inaugurated underwater passage in Istanbul, between Europe and Asia, it will provide for unhindered transit all the way from Beijing to London. The potential for this project to spur economic growth and enhance human interaction is monumental. The fact that it aims to connect the most rapidly developing parts of the world, with traditionally major economic centers is critically important. Initial estimations show that roughly 6,5 million tons of cargo and 1 million passengers will be carried at the beginning, with these figures going up to 17 million tons and 3 million passengers respectively at a later stage. As such, it is one of the most strategic and significant project currently in the making.

 

CE: In which sectors is there a broad need for developing cooperation between Azerbaijan and Turkey?

Alper Coskun: We are currently cooperating with Azerbaijan in numerous sectors and are constantly looking for new opportunities to broaden our activities. We want to capitalize on the natural advantages that we share, namely in terms of our historic and linguistic affinity, as well as our geographic proximity. The number of projects that we have realized to date, as well as the activity of our respective businessmen in our two countries is a testament to the great potential that exists. Given the fact that both our countries have ambitious economic goals, and that we share a firm determination to work more together, there is a solid basis to realize new concrete projects. Azerbaijan is actively engaged in a diversification process of its economy. It is pursuing a strategy to develop the regions, according to comparative advantages. Turkey has a strong knowledge and experience base, as well as qualified human resources with the right skill sets to complement these efforts. Moreover, our businessmen aspire to be more active both in Azerbaijan, and in third countries, together with Azerbaijani business circles. We can use this momentum to branch out our activities and focus on new areas of cooperation, particularly for example in the agricultural, communications, banking, mining and tourism sectors. I am confident that in the years to come, our economic cooperation will broaden in scope and become more comprehensive.

 

Thank you for the interview

 

 

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