Rifat Hisarciklioglu, the president of the Union of Chambers and Commodity Exchanges of Turkey, addresses the Egyptian-Turkish Business Forum. Posted Jan. 30, 2017. (photo by Twitter/@TurkEmbCairo)
Can economic opportunity bring Turkey, Egypt closer?
CAIRO — Egypt and Turkey are exploring economic ventures that would benefit both countries, but experts say a potential financial friendship doesn't indicate relations will improve in other areas.
SUMMARY⎙ PRINTTurkey and Egypt are making investment overtures toward one another despite lingering political animosity that is unlikely to be resolved.
AUTHORKhalid HassanPOSTEDFebruary 17, 2017
TRANSLATORPascale el-Khoury
A high-caliber Turkish economic delegation recently attended the Egyptian-Turkish Business Forum held Jan. 29-30 in Cairo. The visit was the first by a Turkish delegation since June 2013, when mass protests in Egypt ended the Muslim Brotherhood’s rule.
The delegation was headed by Rifat Hisarciklioglu, the chairman of the Union of Chambers and Commodity Exchanges of Turkey, who was invited by the head of the Federation of Egyptian Chambers of Commerce (FEDCOC), Ahmed El Wakeel.
The Turkish Embassy in Cairo said the delegation included 10 senior officials of companies involved in engineering, chemicals, textiles, energy, agriculture and various services, in addition to senior Turkish investors. The goal of the trip was to promote investments and revive trade in Egypt.
"The Turkish delegation wants to heavily invest in Egypt," Hisarciklioglu said in his speech at the forum. "We want more business activities. The frozen friendship between Ankara and Cairo is useless and futile. We must contribute to the development of the two countries and strengthen their economic relationship.”
The countries' relations have been strained since the June 2013 fall of the Muslim Brotherhood in Egypt. All Turkish investments in Egypt were frozen. The tension even led the Import and Export Division at the Egyptian Chamber of Commerce in Giza to call on the government to review all agreements with Turkey, mainly the bilateral free-trade agreement.
Turkish President Recep Tayyip Erdogan, then the prime minister, lashed out at Egyptian Muslim scholars and clergymen supporters of the revolution. Egypt responded by lowering Turkey’s representation in Egypt to a charge d'affaires and expelling the Turkish ambassador to Egypt.
Turkey still refuses to recognize the legitimacy of President Abdel Fattah al-Sisi and describes what happened as a coup against the elected civilian rule.
The Turkish economic delegation's recent visit to Egypt has brought the prospect of improved relations into the spotlight again. The visit also stirred questions. Will the visit jump-start the stalled trade and investment activity between Cairo and Ankara? Will Turkey change its hostile policy toward Egypt?
“Observers note Turkey's desire to improve relations with Egypt," Mustafa Zahran, a researcher at the Foundation for Political, Economic and Social Research, told Al-Monitor. "This is the first official Turkish visit to Egypt in four years. For the first time since June 30, 2013, the Egypt-Turkey Business Council will meet in Cairo.”
He also noted that Turkish Tourism Minister Nabi Avci praised and welcomed Egypt's presence at the East Mediterranean International Tourism and Travel Exhibition, held Jan. 26-29 in Istanbul. It was the first time in two years that Egypt participated in the exhibit, which Zahran said attests to Turkey's desire to rebuild good relations with Egypt. The exhibition attracted representatives of 85 countries and gave Egypt a chance to promote Egyptian tourism in the presence of Turkish officials.
Zahran added, “Egypt is Turkey’s gateway to Africa, and Turkey is Egypt's gateway to Eastern Europe and Central Asia. Both countries know this well. One cannot do without the other, especially in light of the huge Turkish investments in the Egyptian market.”
Turkey has $5 billion worth of investments in Egypt, according to Wakeel. Alla Ezz, the secretary-general of the FEDCOC, told Daily News Egypt that Turkish companies in the delegation to Egypt plan to double that amount to $10 billion this year. Wakeel also noted Egyptian exports to Turkey have reached $1.2 billion, compared with $2.7 billion worth of Egyptian imports from Turkey.
Leaders of Turkish companies in the delegation to Egypt expressed interest in building factories in Egypt's Port Said on the Mediterranean Sea, and Safaga overlooking the Red Sea, Zahran said.
"Egypt is in dire need of such investments."
Many Turkish companies closed factories in Egypt when violence erupted in 2011 as Hosni Mubarak was overthrown as president, and in 2013 when President Mohammed Morsi was deposed. Many of those plants, which employed thousands of Egyptians, remain closed. Some will reopen now, which "will help Egypt secure hard currency because these factories exported their products abroad," Zahran said.
Nevertheless, overall relations between Egypt and Turkey remain prickly. Bashir Abdel Fattah, a researcher at Al-Ahram Center for Political and Strategic Studies, told Al-Monitor, “The two sides agree to cooperate on the security and economic levels, but the dispute between the two presidents is far from over. Erdogan will only recognize Sisi’s regime under specific conditions that Sisi refuses.”
Indeed, Erdogan refuses to acknowledge Sisi’s regime as legitimate and has said that for good relations to resume, Egypt must conduct free presidential elections and release all prisoners arrested after June 30, 2013.
“I think relations between the two countries will not return to what they were before. They will surely witness a remarkable development during the coming days at the economic level in terms of investments and the movement of trade, but that will not [translate into] relations of political support, assistance and alliance as they were during the rule of the Muslim Brotherhood," Abdel Fattah said.
“Turkey’s quest to restore trade relations with Egypt doesn't mean Erdogan recognizes President Sisi's legitimacy, or that Turkey is renouncing its support for the Brotherhood or changing its political positions toward them,” he added.
However, Erdogan has managed to hold his tongue and refrain from attacking Egypt for about three months now. Abdel Fattah said, "A number of Turkish officials have been welcoming cooperation efforts with Egypt.”
On Aug. 20, Turkish Prime Minister Binali Yildirim said in a press statement, “We see that there is a need to develop economic and cultural relations with Egypt, as two Mediterranean countries, and to keep the Turkish and Egyptian peoples away from the repercussions of the existing political differences.”
In his last statement on Egypt, on Sept. 3, Yildirim said his government’s foreign policy is based on making many friends and fewer enemies and is seeking to improve relations with many countries, including Egypt, after normalization of ties with Russia and Israel. He noted that Turkey is making serious attempts to normalize relations with Egypt and Syria.
Abdel Fattah said, “Political differences between the two countries are still pending and Turkey will keep supporting the Muslim Brotherhood, but economic relations will be restored with full force, and this is the only objective Turkey is trying to achieve.”
It seems both countries are well-aware that improved economic relations would serve them both. It also seems clear that diplomatic and political relations between the two are not likely to improve anytime soon, as Egypt will not meet Turkey’s conditions for mending ties and Turkey won't let go of its demands.
The improvement of economic relations is a mere relaunching of investment and trade relations, but in no way represents a Turkish admission of the legitimacy of Sisi’s regime. Diplomatic relations between the two countries are still strained.
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