Can Turkey Be an Energy Hub for Europe?

By Dimitrios Tsioulis

Turkey’s rapid recent progress appears to refute the notion that political change, hampered by immovable bureaucracy, tends to take a long time. Ankara was perceived to be a basket case but a decade ago, suffering from severe structural weaknesses. It was constantly on the brink of economic collapse and the unyielding bras de fer between Kemalist and Islamist political parties led to political instability and social unrest. Yet modern-day Turkey has managed to overcome these adversities and is turning towards a promising, dynamic future. 

Indeed, the current global economic crisis is hardly noticeable in the country nicknamed the “China of Europe”. Its GDP growth is skyrocketing compared to the average of most countries of the EU, while its foreign direct investments remain dizzyingly high, despite being moderately affected by the recession. Considering Turkey’s political stability under Prime Minister Erdogan’s Justice and Development party for the past seven years, Turkey has secured its role as an important regional power, while Ankara’s latest policies towards the Arab world certainly indicate a shift of focus to wider  global issues.

In the meantime, EU states are facing overwhelming economic difficulties such as high deficits and distressful public debts. The eurozone seems to be falling short of its aims with countries like Greece, Ireland and more recently, Portugal requesting European and international assistance in resolving their muddled economic and fiscal policies. However, the European economy has already received another severe blow. Europe’s domestic energy resources, which are essentially fuelling its industrial sectors, are the cornerstone of its competitiveness and sustainability. Its current supplies are far from sufficient. According to a number of statistical reports, Europe’s principal strategic partner in energy is currently Russia. In 2006, a study of the European Commission emphasised Europe’s high dependency on Russian energy resources: over 40 per cent of the EU’s natural gas imports alone originate from Russia. This percentage is expected to exceed 60 per cent by 2030, with Europe’s overall external dependency on energy commodities reaching 80 per cent.

However, the temporary shortages of natural gas that occurred during the political face-off between Ukraine and Russia in 2006 caused serious functional damage to European societies, paralysing industry and  forcing the EU to reconsider its initial energy strategies and energy security policies. Europe’s relations with Russia are still heavily impaired. The EU is aiming to prevent similar politically motivated shortages by adopting short-term measures such as the third energy package. More importantly, EU member states have to ensure energy security by diversifying their energy sources. The list of possible alternative and reliable strategic partners is in fact very short.

Turkey’s historical ties with Europe remain problematic. Turkey’s refusal to make the required internal changes  stated by the EU’s acquis chapters or to adopt sensitive political reforms since the formal accession talks began in 2005, have rendered the Turkish bid unpopular. Despite that, the issue of energy security has produced fertile ground on which cooperation between the two sides is already being fostered.

Turkey’s main advantage is clearly its geographical position. Ankara is close to 72 per cent of the world’s proven gas and 73 per cent of global oil reserves, particularly those of the Caspian basin. European states whose energy-related imports are expected to grow by 15 per cent until 2030 have surely noticed Turkey’s appealing neighbourhood. Turkey’s aforementioned economic stability and investment capabilities, as well as its existing internal pipeline network, are key factors in developing the EU-Turkey partnership. A notable step towards an energy synergy between Europe and Turkey was taken in 2006 with the completion of the Brussels-backed Baku-Tbilisi-Ceyhan Pipeline. Bearing this in mind, the flagship of the EU-Turkey strategic partnership will eventually be the Nabucco Gas Pipeline, which according to the latest predictions is expected to be operational by 2018. Nabucco’s capacity will reach 31 billion cubic metres (bcm) per year the majority of which will originate from the Shah Deniz II gas fields in Azerbaijan with other states, such as Iraq, Turkmenistan, Kazakhstan and to a lesser extent Egypt, also contributing gas. This 3,300 km long pipeline will pass through Turkey, Bulgaria, Romania and Hungary before reaching the Baumgarten gas-trading hub in Austria. Along its way, Nabucco will interconnect with several other pipelines such as the Italy-Turkey-Greece Interconnector, increasing the highly anticipated diversity of supply routes for the EU.

Despite the apparent advantages of the Turkish role in securing the EU’s energy, several spinous issues remain. Chief amongst them is the uncertainty of supplying the enormous Nabucco pipeline with the aforementioned quantities of natural gas. Nearly a decade since the initial Nabucco plan was introduced, the geopolitical puzzle of who is actually going to contribute to it and with how much has not been clarified. Even its main supplier, Azerbaijan, has not issued any accurate volume predictions of its contribution to the project. The feasible alternative solutions of Iran on the one side and Turkmenistan and Kazakhstan on the other have encountered political obstacles from the West and Russia respectively. Interestingly enough, the supply difficulties Turkey is encountering might also be a clue in explaining Ankara’s increased focus on the Arab world and its Muslim tradition. Moreover, the costly construction of the Nabucco pipeline will require a scale economy principle in order to ensure its feasibility and prosperity. Thus, the lack of sufficient affirmations for the steady supply of Nabucco has severely depleted the potential capital budgeting, forcing the consortium members of Nabucco to postpone the construction of the pipeline several times despite Europe’s pressing needs.

Finally, Turkey still needs to adopt a transparent framework concerning gas transmission and conform the liberalisation of its internal energy market with EU regulations. On this matter, many EU officials have underlined the need to seperate the issue of Turkey’s European candidacy from any development regarding the EU’s energy security, fearing that Ankara, in a similar way to Russia, will use its energy leverage to increase the bargaining chips towards its accession bid.

Nevertheless Turkey’s significance in Europe’s energy security conundrum is undeniable. Turkey possesses not only an extremely compelling geographical position but also many of the qualitative and quantitative characteristics essential to ultimately become an energy hub for Europe. Yet, in order for this strategic partnership to be successful and prosperous for both sides, it should encompass their mutual strategic concerns and a solid and mature platform of understanding. 


Dimitrios Tsioulis holds a BA in International and European Studies from University of Macedonia, Thessaloniki and he is currently studying for an MA in Conflict, Security and Development at King's College London. He has previously worked for the Hellenic Parliament and his current research focuses on EU's energy security issues.


12 June 2011


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