Every summer, thousands of Russians and Ukrainians flock toTurkey's south and western regions to enjoy the pristine beaches and other tourist attractions. High on their list is the city of Izmir, my hometown, on the spectacular Aegean coast. I moved to the United States from Turkey in 2016 after completing my double major in Engineering and Economics. My family and many of my friends are still living in Izmir an ancient city founded by the Greeks, taken over by the Romans and rebuilt by Alexander the Great before becoming part of the Ottoman Empire in the 15th century.

Geographically, Turkey, a NATO member since 1952, sits between East and West, influenced by both European and Middle Eastern cultures. Every Turkish child at elementary school learns about the uniqueness and importance of our location and the inherent geopolitical risk that arises from it.

Turkey has a centuries-old history of both confronting and cooperating with Russia. The Bolshevik Russian government was a supporter of the Turkish War of Independence in the early 1920s. After World War II, our relationship turned sour since the Turkish government was against Soviet communism and aligned with Western Europe and the United States. During the Cold War, Turkey joined NATO and placed itself firmly within the Western alliance. Following the dissolution of the Soviet Union, Turkey found relief in the fact that it no longer shared a land border with a troubling neighbor.

As the risk of communism was swept away at the end of the 1980s, the relationship between Turkey and Russia normalized. International trade improved significantly after 2002, and many Turkish companies (especially in construction) began to operate in Russia. However, conflicts of interest between Turkey and Russia remain. In 2014, Turkey supported Ukrainian independence and affirmed its territorial integrity. Turkey’s President Recep Tayyip Erdogan denounced Russia’s annexation of Crimea and has advocated on behalf of Turkic Tatars, who have suffered under Russian rule here. As in many other instances, such as Crimea and Syria, the Russian-Turkish relationship will be tested again during the Ukrainian war. How Russia and Turkey manage this volatile and complex relationship will determine the future trajectory of not only bi-lateral relations but regional stability as well.

For Ukraine, Turkey has sought out a clear partnership. The two countries signed military cooperation and other agreements in 2020. In April 2021, Turkey announced its direct support of Ukraine’s NATO membership. Just before the war started, on February 3, 2022, Turkey and Ukraine signed a free-trade agreement and a joint production agreement to manufacture Turkish drones.

Where Turkey Stands on the Russia-Ukraine War

Turkish President Recep Tayyip Erdogan said, "We find military action unacceptable and reject it. This step, which we see as contrary to international law, is a heavy blow to the region's peace, tranquility, and stability.” Erdogan has strong personal relations with both Russian president Vladimir Putin and Ukraine president Volodymyr Zelenskyy, and Turkey is ideally placed to mediate between Kyiv and Moscow.

Turkey has twice hosted direct negotiations between the two sides. On March 10, Russian Foreign Minister Sergei Lavrov and his Ukrainian counterpart Dmytro Kuleba met in the southern Turkish city of Antalya, and the two sides' negotiators later met in Istanbul on March 29. So far, little has come from those meetings.

Erdogan’s approach includes aspects aimed at pleasing both Moscow and Kyiv. Turkey voted in the UN to condemn the invasion but has not agreed to join the sanctions against Russia since Turkey is massively dependent on Russian natural gas, grain imports, and tourism. But, compounding the complexity, Turkey sold armed drones to Ukraine, and Turkish Bayraktar drones played a crucial role in Ukrainians resistance. In fact, one of those drones was instrumental in the sinking of the Russian flagship Moskva in the Black Sea by Ukrainian forces.

The Montreux Convention has regulated merchant and military maritime traffic into and out of the Black Sea since 1936, and it gives Turkey the right to restrict warships from using the Turkish Straits, the Dardanelles and the Bosporus, during wartime. On February 28, 2022, Turkey announced that it was limiting the passage of warships belonging to Ukraine and Russia through the Straits unless ships were returning to their bases in the Black Sea. With this decision, Turkey has strictly fulfilled its responsibilities within the framework of the institutions and alliances it is involved in, especially the UN and NATO.

Turkey’s Humanitarian Efforts

Since the beginning of the war, Turkey has sent 82 truckloads of humanitarian assistance and a mobile kitchen truck to Ukraine. A five-member team from Turkey’s Disaster and Emergency Management Authority (AFAD) is based in the Romanian city of Siret and Lviv in Ukraine to determine humanitarian needs and manage aid sent from Turkey.

Turkey, which hosts more than 3.7 million refugees from Syria and is one of the world's largest refugee hosts, prides itself in not discriminating against refugees based on their country of origin or ethnicity. Turkey has welcomed thousands of Ukrainian refugees as well.

Not only Ukrainians but also Russian citizens are seeking refuge in Turkey. It is estimated that around 14,000 Russians left their country for Turkey in the first three weeks of the war. Turkey offers visa-free entry to Russian nationals. Those fleeing are mostly anti-war activists and political opponents of President Putin. At the same time, wealthy Russians and oligarchs have bought houses in Turkey since foreigners who purchase real estate worth $250,000 or more can earn Turkish citizenship in three months. In addition to apartments, Turkey has proven a physical and financial haven for oligarchs and their assets. This has put Turkey in a risky spot and could damage the country’s reputation in the long run.

According to Turkey's Pulse survey conducted by the consulting firm Metropoll , just five percent of Turks believed Russia was the biggest threat to Turkey before the Ukraine invasion. That number jumped to 19 percent in March after the invasion. Similarly, in March, 29.5 percent wanted Turkey to prioritize Russia and China as partners; it was 39.4 percent before the invasion. On the other hand, In January, 60.5 percent thought Turkey should stay in NATO, while this number dropped slightly to 59.6 percent in March. It seems that Turkish society is beginning to lose faith in its allies in the West and its friends in the East.

The Russia-Ukraine war is threatening Turkey’s economy

Amid Turkey’s ongoing economic crisis due to its excessive current account deficit and unorthodox theory about interest rates (the country cut interest rates despite high inflation, the opposite of traditional behavior), the war in Ukraine has led to sharp hikes in prices for energy and other imported commodities. According to the Turkish Statistical Institute, Turkey’s annual consumer inflation rose 7.25 percent month-on-month in April alone and jumped to 69.97 percent annually. Turkey’s Inflation Research Group (ENAGrup) estimates that consumer goods and services prices spiked 156.86 percent between April 2021 and April 2022.

Turkey must maintain a balancing act between its Black Sea neighbors and other critical important economic partners. It cooperates closely with Russia in energy, trade, and defense. But it also has deep defense ties with Ukraine.

In 2021, Turkey’s bilateral trade value with Russia was $37.7Bn (up from $1Bn in 1992)  with the bulk of that trade, some $29Bn worth, consisting of Russia exports to Turkey. The main Russian exports to Turkey are refined petroleum, natural gas, and cereals.

Together with Russia, Germany, Italy, and other European countries are important export markets for Turkey. Low economic growth in those countries due to the war (see table above) will likely harm the Turkish economy. Moreover, Turkey’s exports of machinery and transport equipment to European countries remains heavily reliant on imported intermediate materials from Ukraine and Russia. The war may halt that production and the damage to Turkish export earnings would be worse than expected.

On the other hand, Ukraine is the thirteenth largest import market for Turkey. The main products that Ukraine exported to Turkey were semi-finished iron, hot-rolled iron, wheat, and corn. During the last 29 years, the imports from Ukraine have increased from $90M in 1992 to $4.5Bn in 2021, and bilateral trade reached $7.4Bn.

Another important aspect of Turkey’s relations with Ukraine and Russia is its dependence on tourists. Tourism revenues are vital to the Turkey’s hard currency reserves and growing current account deficit. In 2021, 24.7 million foreign tourists arrived at Turkey and tourism revenue hit $24.5Bn. The war could have an impact on Turkey's tourism industry as Russians and Ukrainians are the country’s first and third biggest respective sources of visitors. A total of 4.7 million Russian tourists and 2.1 million Ukrainian tourists visited Turkey in 2021 and they accounted for 27.34 percent of the total tourists that arrived. This year, Turkey was expected to host around ten million Russian tourists. However, the invasion, war economy, and sanctions will surely affect these numbers.

2022 will be a challenging year for Turkey. Higher import bills and lower-than-expected revenues from exports and tourism will exacerbate the Turkish economy’s fragility. According to The Conference Board April 2022 projections, economic growth for Turkey is expected to decelerate from 11.2 percent in 2021 to 3.4 percent in 2022 and 2.5 percent in 2023.