18:47 GMT +327 September 2016
Live
Turkey flag

On the Brink? Russian Sanctions to Cost Turkey Four Times Initial Estimates

© Flickr/ Matt Czarnocki
Middle East
Get short URL
26156321057

Russian sanctions are now expected to cost Turkey more than $12 billion annually - four times Ankara's previous estimates, according to a Turkish trade official; this, together with the consequences of the recent terrorist attacks in which the country's tourism industry was targeted, signal that Turkey should brace for the worst.

Terrorism and Russian sanctions have left Turkey’s already struggling economy bracing for the worst, according to Aydin Sezer, a former trade official who formerly represented the Turkish government in Moscow.

Russian sanctions would cost Turkey more than $12 billion annually — four times Turkish government estimates, the Voice of America quotes him as saying.

His words are echoed by the Turkish Agriculture Ministry, who said last week that the Russian ban on imported Turkish food products will mean financial losses of about $764 million.

“Russia has 60 percent of our fruit and vegetable exports,” said Burhan Er, the president of the Turkish Fruit and Vegetable Sellers Association. “We lost all of that. Russia is a big market for us.”

One of Turkey's biggest financial institutions, the public bank Is Bankasi has issued a report on the impact of Russian sanctions, saying that exports, along with trade and construction revenue, will be the "hardest hit areas" for Turkey. At best, Turkey's annual losses will be $4.4 billion; in a worst-case scenario, it could reach to $7.3 billion.

Turkey's President Recep Tayyip Erdogan.
© AP Photo/ Basin Bulbul, Presidential Press Service Pool
Moscow has also banned Turkey as a tourist destination for Russians, which has already led to dire consequences for shop owners, cab drivers and street vendors, whose livelihoods depend on visitors.

“Business with Russia was already slowing down,” according to businessman Zafer Soylu. “Many shops will have to close.”

Losing Russian tourists could cost Turkey more than $3 billion a year, according to industry experts. In 2014 alone, 4.5 million Russian tourists visited Turkey.

Russian sanctions, however, are not the only cause of concern for Turkey. The recent terrorist attacks, which left at least ten German tourists dead in Istanbul's historic Sultanahmet Square, have yet to take their toll on the industry. German tourists account for roughly 15 percent of Turkey’s tourism industry, which earns the country $34 billion annually.

Following the attacks, the German Foreign Ministry has advised travelers to "temporarily avoid" crowded public places and tourist attractions in Turkey.

“After the bombing, Turkey tourism is finished," predicts Turkish tourism expert Refet Kayakiran, citing a rash of German tourism cancellations.

Related:
Top Clothing Brands May Halt Production in Turkey Due to Russian Sanctions
Russian Sanctions Could 'Topple' Turkey's Erdogan - Iranian Analyst
Blast in Turkey’s Diyarbakir ‘Plays Into Hands’ of Erdogan
Tags:
terrorist attacks, collapse, tourism, economy, sanctions, Germany, Turkey, Russia, Ankara
Community standardsDiscussion
Comment via FacebookComment via Sputnik
  • Сomment

All comments

  • art
    Turkey has a large volume business with Iran as well. With opening of the Iranian market to the Europeans, it won't be surprising that Turkey loses a good portion of that market share to the Europeans as well. They don't call the man Errorgun for nothing.
  • Huh?
    I have a difficult time understanding the "why" of things. Erdogan in his quest for power, glory, fame or reassertion of the Turkish Empire is destroying his country and the people along with it.
    Either he is mad with power after 20 years and has become Machiavellian in his thoughts and actions or there are handlers pushing him to do these things...with promises of riches, and he is too blind to see that in the end he will also lose.
  • jasin reply toHuh?(Show commentHide comment)
    Huh?, Good comment. I can't figure it out either. It seems to be the same pattern as NATO and the West, so I'm thinking he's being pressured from outside Turkey.
  • Athanasios
    In Economics there is the concept of Multiplier. The actual effect of $1 cut in exports will multiply several times in terms of its effect on the Turkish GDP, depending on the sector the exports are coming from.
  • Huh?
    Jas,
    I have been following this on multiple streams of info and yet while everyone discusses the issues, there isn't enough conversation regarding the underlying reason(s).

    It is obvious how distorted and convoluted the whole environment is surrounding all of the events. I have learned to accept that the only answers that any of us will see, are a lot of double talk, back tracking and misinformation.

    Remember...there are no potholes, only pavement deficiencies
    there are no homeless people, only those that refuse to work
    there are no wars, only the redistribution of democracy
  • Mikhas
    Russia and her anti jihad coalition may succeed were the US never does: Sanction an undesirable government/regime until the people or military themselves directly or by circumstances bring them down.

    Of course, Russia had no problem with the little megalomaniac despot before he thought the time was ripe to start his jihad and restore the Ottoman empire, and Russia does not need to do much either whatever Mullah Erdogan has built will come down like tons of bricks over him...
  • Mikhas in reply toHuh?(Show commentHide comment)
    Huh?, Exactly, he had plenty of time to figure out how to achieve things while doing time in prison for his little mini-jihad-empire as a mayor but he is obviously not smart enough.
  • This could not have happened to a nicer bunch of assholes in Turkey.
  • jasin reply to (Show commentHide comment)
    siberianhusky, But it's a shame that the people have to pay the price for a leader who obviously doesn't have their best interests as a priority..
  • Mother Gorilla
    Consider the lesson of this arithmetic of sanctions: the chastisement by Russia cost only 12 billion, the Daesh strike 34 billion and more, as not only Germans, but other European tourists might reconsider visiting Turkey. So the advice is clear: get out of the bed with the Americans and their IS, try to reconcile with Russia and if possible, with the Kurds, so as to remain/return in the good graces of the EU. The rest is Erdogan rhetoric.
  • Turkey... that gangster, back stabbing country started their dirty business with Greeks and Serbs. First they invaded Greek territory,. than they created terrorist-insurgency in Bosnia using they Turkoid sapiens population in the war against Serbs. After they properly got their behind whooped, USA came to bomb Serbs. This is where Turklanders and US cooperated like true palls against one small nations.
  • in reply tojas(Show commentHide comment)
    jas,

    Turky has the same problem as many other countries. They elected the crooked politicians that run the country. So who is to blame. The crooks or the people who put them in charge
Show new comments (0)
Top stories