Turkey-Israel trade ties hits a brick over present conflict

Although the improving relations between Israel and Türkiye are back to square one after the outbreak of the Israel-Hamas conflict, the two sides’ economic ties are expected to tide over the political turmoil, said experts.

Ankara has hurled its strong criticism at Israel since the Gaza conflict began in early October and recalled its ambassador earlier this month over Israel’s rejection of a cease-fire.

Israel’s ambassador to Türkiye, appointed just at the start of this year, left Ankara in October over security concerns after Türkiye shifted from a cautious to a critical tone against Israel amid the rising humanitarian toll in Gaza.

“We can definitely say that the expansion of bilateral relations is now on hold,” Batu Coskun, an Ankara-based independent political risk analyst, told Xinhua.

In the first days of the conflict, Türkiye offered to mediate. Yet when Turkish President Recep Tayyip Erdogan described as “liberators” the Palestinian Islamic Resistance Movement (Hamas) who launched a surprise attack on southern Israel on Oct. 7 that triggered the conflict, the offer lost its appeal, Coskun said.

“Türkiye isn’t really in the picture” regarding the ongoing mediation efforts involving Arab states and the United States, and its role appears limited diplomatically, the analyst stressed.

Nevertheless, economic ties between Israel and Türkiye have remained strong and even grown in recent years despite their wavering political relationship, and analysts expect this trend to continue.

The two countries signed in 1996 a free trade agreement, which Coskun said contributed greatly to the flourishing bilateral trade ties despite the political differences.

The bilateral trade volume between 2002 and 2022 increased from 1.4 billion U.S. dollars to nearly 9 billion dollars, as per data from the Turkish Statistical Institute.

Kerim Has, a Moscow-based analyst, believed Ankara, grappling with high inflation and low foreign currency reserves, will not take any economic and commercial restrictions against Israel, adding that, in turn, Israel will adopt a similar attitude towards Türkiye in this regard.

Türkiye benefits a lot from trade with Israel by mainly exporting metal (steel), machinery, plastic, cement products, textiles, and motor vehicles to the latter. So, the country will refrain from harming commercial ties with Israel so as not to “shoot itself in the foot,” said the analysts.

As the Gaza crisis rages on, there have been growing calls in Türkiye for boycotts of Israeli businesses. However, Coskun and Has both stressed that these calls could only have symbolic value.

Still, at the government level, Ankara has decided to suspend talks with Israel on cooperation in energy drilling operations and natural gas networks to Europe in the eastern Mediterranean, as reported by Turkish NTV television.