The wars in Syria, Libya, and Yemen reshaped relations between regional powers in Southwest Asian and North Africa. The rise of the erratic prince to power in Saudi Arabia created even more uncertainty, instability, and violence. None of that seem to be enduring, though. Just months ago, Turkey and Egypt were at odds over war in Libya and the handling of the Muslim Brotherhood by Sisi’s regime. Saudi Arabia, Turkey, and Qatar were united by their desire to overthrow the government of Syria but Qatar and Turkey stood firm against Saudi Arabia’s pressure on Qatar to fall inline with its Gulf allies. Saudi Arabia and UAE worked together to reinstate a failed regime in Yemen, but the two countries seem to be pursuing different strategies and different goals. Meanwhile, Iran stood firm in support of the Syrian government and the Sanaa government. These conflicting interests have created intersecting alliances that proved to be temporary. Now all sides, except Iran, appear to be undergoing a major rethinking of their strategies and priorities. Nothing more telling than the recent events that are occurring at a dizzying speed, making it difficult for experts in international relations to analyze and explain.
Just this week, Iran has opened a new trade route, linking the UAE and Turkey through Iran. This new land route will speed up the process of transporting goods from 6 to 8 days, when it used to take 20-21 days to transport them by sea going through Bab al-Mandab Strait, the Red Sea and the Suez Canal from the port of Mersin, Turkey.
On this subject, Turkish media reported that Abu Dhabi Crown Prince Mohammed bin Zayed, will be visiting Turkey for the first time in 10 years. During the visit, expected to take place in days, Bin Zayed will meet Turkish President Recep Tayyip Erdogan. This project is likely to be one of the most important topics that Bin Zayed will have to discuss, in addition to the Emirati investments in Turkey.
This project has significant economic effects, especially on the level of trade exchange between these countries among themselves, and it will also negatively affect the economics of the Suez Canal. Here are some of the implications of this development and some of the ways they will impact related matters.
- Trade exchange between these countries, UAE, Turkey, and Iran and will grow now without the need for sea transportation, especially in terms of its material costs (the costs of chartering ships, tankers, insurance…).
- The average annual volume of trade exchange between the UAE and Turkey is about $8 billion, and the UAE ranks first in the Arab world in terms of the value and diversity of its investments in Turkey.
- As for Iran, the UAE is the number one exporter, with a value that recently exceeded $7 billion. Turkey occupies the second place with two billion and 435 million.
- In terms of Iranian exports, Turkey is at the top of the list of importers from Iran, second only to Iraq, with 2 billion and 308 million dollars, and then the UAE with 2 billion and 243 million dollars.
- This land route shortens the distance compared to the the sea route, which is approximately 6400 km; while on the land route it is estimated at about 2,400 km.
- The land route through Iran will impact the financial benefits of the Suez Canal for Egypt, as its revenues to the Egyptian state are estimated at more than 5 billion annually.
In addition to these direct effects, these developments have geopolitical ramifications as well.
This project constitutes a means for more and more rapprochement between these countries, especially between the UAE and Turkey. The two countries recently restored bilateral relations between them through high level contacts, first, with Bin Zayed’s call with Erdogan at the beginning of last August, then followed by Tahnoun Bin Zayed’s visit to Ankara a few days later.
The success of this project also opens the way for the opening of a new joint sea-land route that is part of China’s global, Belt and Road Initiative.
The connection through this trade project establishes political understandings between these countries, which can constitute a path to finding solutions to the crises in neighboring countries. These projects could impact the reconstruction of Syria, the economic and political problems in Lebanon, and the absurd war on Yemen.