Turkey to Invest in Iran’s Oil Industry

He talks about Turkey's efforts to strengthen economic cooperation between the two nations. He is so delighted that Turkish investors are willing to invest in Iran's oil and gas industry. Since 2010 Emit Yardim has tried his best to enhance Tehran-Ankara relations, he is a highly successful diplomat in both politics and economy by facilitating trade delegations visits. He spends his holidays sightseeing Iran and regrets that natural and historical tourist attractions have been neglected by the Iranian government. According to him, tourism is an important sector. He also mentioned the potential of non-oil exports in both countries. Iran has capabilities in agriculture, building materials and steel industry while in Turkey textile and furniture industry stand strong and are exported globally.



There has been a significant increase in Iran-Turkey economic relations. Even sanctions had no effect on them. Is it Recep Tayyip Erdoğan's policy or Turkish investors are the driving force behind it?
There has been a consensus on boosting cooperation with Iran among the government authorities and the private sector in Turkey. Chambers of Commerce play a big role in Turkey's economy and are interested in Turkish-Iranian partnership. Four trade delegations visited Iran in the past month and the Turkish embassy facilitated their visits and meetings with Iran Chamber of Commerce officials. One of the most important ones was the Izmir Chamber of Commerce which also travelled to south of Iran to visit oil fields. Izmir is one of the country's foremost trade centers. There were also several trade delegations from Istanbul visiting Iran during the past days. Turkey also participated in various exhibitions in Iran such as Iran Health Exhibition and the Iran Oil Show. Turkey has relations with Iranian businessmen via its consulates in Tabriz and Urumiyeh and Turkish investors are noticeably present in north-west of Iran. Ties between Turkish businessmen and those of Tabriz and Urumiyeh are such strong that they have never been affected by the political turbulence. We would like to expand these relations to other cities of Iran and trade delegations are exploring grounds for investments and boosting relations. There are meetings with all businessmen and entrepreneurs in Iran, for example last week we were in Lorestan province familiarizing ourselves with the investment potentials and we talked about our potentials and capabilities as well. After that we went to Salafchegan Special Economic Zone and studied investment opportunities there. Both Iranian and Turkish embassies support the efforts and try to facilitate the process. We, in the embassy, would be pleased to help our government to achieve the ultimate goal of maximizing the economic relations between the two countries. The sectors are also very important. In my assumption, there is potential in all industries and the population of more than 150 million in Iran and Turkey is a bonanza and enables us to exploit the economic potential.
Due to Iran's oil and gas reserves and Turkey's dependence on them, there are various attractions and opportunities. however, the economic relations of the two countries are mostly focused on the energy sector. There is no doubt about the crucial importance of energy sector and its potentials; however, we need to step in other sectors such as agriculture, infrastructure and transportation as well. It's time to expand non-petroleum exports.

What kind of products? What factors should be considered?
Is tourism included in your question?

It could also be part of it…
We currently import oil, gas and steel from Iran. We believe that there is much potential in other sectors such as agriculture and industry. What we need is investing in these sectors. Iranian companies could also come to Turkey and establish partnerships. There are thousands of Iranian firms in Turkey and this number could be increased.
We think that there is a great potential in Iran to be a popular tourist destination. Therefore, Iran needs investment in this sector. Supply and demand determine the price and the market for products such as oil and gas. This means that if demand increases the supply will also increase and vice versa. Tourism industry is a totally different story, you have a product which must be exposed and your image is crucial so as to accumulate wealth. I think this has been neglected in Iran's economy. With many tourist attractions, Iran could be a destination for Turks. After the economic boom in Turkey, a great number of people travel to foreign countries each year. Nine million out of 75 million Turks go abroad for leisure or work annually. Although there is a visa-free agreement between the two countries the number of visitors to Iran hover around 40 thousands. There are lots of attractions for us in Iran which are actually part of our own history, namely "Tuğrul Tower" in the City of Rey which could attract 10 thousands Turkish tourists each year. It would be brilliant if one million Turks travelled to Iran every year. This industry is of crucial importance, looking at Turkey, it is ranked the 6th most popular tourist destination in the world with the revenue of US$ 27 billion. Why shouldn't many more Turks visit Iran? "why shouldn't Iran raise its tourism revenues?

You emphasized the crucial importance of investing in tourism. I remember that in our previous interview you even mentioned the migration of Iranian nomads as a tourist attraction…
Sure. All these are attractive for tourists; as far as I am concerned Turkish visitors enjoy sightseeing and the untouched nature of Iran. If Turkish people learn about those attractions, they will travel to Iran of their own free will.

Considering the difficulties of exploiting the potential in tourism industry, it seems that Iranian and Turkish officials are mostly focused on trade. Oil swap scheme has been discussed and the Izmir Chamber of Commerce suggested building storehouses in the border to facilitate the swap process. Turks are interested in Iran's energy resources. What are the goods and products on their side?
There are thousands of mechanisms to run such scheme. Free trade zones facilitate cross-border trade. Fortunately the "preferential trade agreement" which was signed earlier will boost reciprocal trade ties between Iran and Turkey. Iran has other valuable products such as steel and building materials and in Turkey textile and furniture industry stand strong. The options such as automobile parts, building materials, pharmaceutical products and so on will be discussed in joint meetings.

But Turks are mainly interested in Iran's energy and the Izmir Chamber of Commerce asked to visit Iran's oil fields in the south. As you know giants such as Shell, Total, BP and Eni are interested to step in, what's Turkey's winning hand? Do they seek investing in Iran or is it the know-how?
First of all I am so delighted that the Izmir delegation visited south oil fields. Investing in oil and gas industry is a matter of mutual interest; I mean that trade is not enough. Those mega projects cost a lot and Turkey is eager to invest in Iran and the government encourages the investors. We both know we are not on a two-way street and both Iran and Turkey have various business partners. Of course we try our best to boost the reciprocal ties and that is why I am here in Tehran. Iran is a powerful country and has a remarkably young and educated population with entrepreneurial ideas. As a result, many countries would be interested to cooperate with Iran. Turkey has also the same situation.

It has been years that Turkey imports Iran's gas. Recently Turkey filed a lawsuit against Iran at the International Court of Arbitration for charging high prices. Why have the two countries failed to reach a consensus?
It is not so complicated and is just a technical flaw.

So why hasn't there been an agreement? Why a lawsuit at the International Court?
When you go shopping you always look for a bargain price so you might check different stores or ask for a discount, it is pretty normal in the world of commerce. That was our request which was turned down by the Iranian side.

So the price for gas has not been finalized yet?
No not yet. It is on the table.

At that time Iran's Minister of Oil announced that providing the volume of import increases, the price might be reduced. Otherwise it is not affordable for Iran.
The increase of the volume has not been discussed yet. The demand for gas in Turkey has almost remained the same. There is no doubt that there is a high demand for gas in Turkey but we should be able to afford it. By the way the situation might change in coming months.

In a recent visit to Iran the Turkish Minister of Development attended the Iran-Turkey Joint Economic Commission meeting. Was the gas price discussed?
Trade relations are discussed in the JEC. Last month Iran's Minister of Communication and IT and the Turkish Minister of Development held a meeting in Tehran. There is also a high level cooperation council. The countries are expected to hold the first meeting during President Rouhani's visit to Turkey. Turkish and Iranian officials have continued discussions on the strategic relation issues since the last visit of Prime Minister Recep Tayyip Erdogan to Tehran. The council consists of 9 to 10 ministers from each country. In fact this would be a joint cabinet meeting.

Has the visit been scheduled?
Not yet. We have suggested a time table which was rejected by the Iranians due to the busy schedule of the President. Iran has also announced dates in which we were not able to host President Rouhani.

Are Iran and Turkey planning to develop international relations by letting other countries into the game?
What countries?

For example Azerbaijan. Tehran, Ankara and Baku have reached an agreement on a roadmap for Caucasus. This may not disrupt the Ankara, Baku and Yerevan relations. On the other hand Iran-Armenia strategic cooperation might be at stake. In your opinion, what is a proper model for this trilateral cooperation?
Such alliance would not be against any country; it is all about the trilateral relations of Iran Azerbaijan and Turkey. Countries have different policies towards each other and we respect that. Iran, Turkey and Azerbaijan are three key players in Caucasus. There are historic and cultural similarities. The languages of these countries have a lot in common and we have the same values and customs. Islam has brought us together.
In my assumption, if the roadmap leads to a trilateral alliance it could boost regional ties and cooperation. As you may know the idea for a roadmap is not a recent thing. It was raised in the trilateral meeting of the Ministers of Foreign Affairs of the Iran, Turkey and Azerbaijan in Istanbul three years ago and was welcomed by the rest of the ministers. There was a same meeting in Urumiyeh and Nakhichivan and the forth meeting was held in Van , Turkey in March 2014. Another meeting is expected to be held in Iran next year. We are so delighted and think that such meetings will boost the trilateral ties. The cooperation must be facilitated.
Armenia has occupied an Islamic country, one third of the Azerbaijan territory is currently occupied and one million Muslims have fled their motherland. The UN resolutions have not been fulfilled by Armenia and it remains indifferent to the concerns of international community. From both International and Islamic point of view, Armenia is an occupier. We pin our hopes on the negotiations and await Armenia's return to justice and respect. We hope peace, security and stability will return to Caucasus.

Turkish and Iranian businesspeople and companies tried for a rapprochement between the countries by paying visits. Due to the deep divisions over the Syrian conflict, the trend continued, as the situation continues in Syria, what should be done for détente?
Iran and Turkey are both key players in the region and no other issue should overshadow their relations. I would say we cannot imagine Iran without Turkey and Turkey without Iran for thousands of years. There might be disputes over different issues which is pretty normal. Our relations are not confined to economic relations and political relations are above all. Without consensus on politics, it is impossible to talk about any kind of alliance.
Syria has turned into a matter of concern in the international community yet it must not overshadow our friendship.
There are also many cultural commonalities, our thinkers and poets …. As I said Turkey Tehran's thaw is all that matters.

You mentioned the cultural commonalities, your four-year tenure might be finished or might be renewed, after four years what is your assessment of Iranian culture and customs?
Let me tell you that I am deeply grateful for these four years in Iran. I feel all the positive and negative aspects of living in Turkey here in Iran. That is because living in Iran has been internalized for me. I am not able to be indifferent to the difficulties and concerns of the Iranian people as if I was living in Turkey. For example, if the traffic makes me angry in Turkey, it is's the same in Tehran.
In my assumption, there are many cultural commonalities and there is a common sense. I look at Iran not just as a country but as a country with a key role in Turkey's culture, history and identity. Iranian and Turkish citizens have the same priorities. We need to protect our culture and values. My culture has been institutionalized for me.
The history of Iran and Turkey are bound to each other, there have been ups and downs during the past centuries in our relations; however, the two nations have always been close. When you study "Shāhnāmeh", one of Freydoun's sons is the Shahof Touran. Iranian and Turks have lived side-by-side in amity for thousands of years and this must be continued.