The political economy of Turkey’s relations with the asia-pacific

Abstract

As the geographical focus of global economic activity continues to shift from the West to the East, Turkey is making efforts to improve its relations with the countries of the Asia-Pacific, with economic interests forming the backbone of this enterprise. With respect to bilateral trade, Asia-Pacific remains a major source of Turkey’s trade deficit, and the gap is widening, thus contributing negatively to the chronic current deficit problem of the Turkish economy. Facing this adverse situation, Turkey is prioritizing balancing its economic relations with the countries of the Asia-Pacific by attracting more investment from them, and while the inflow of financial capital is certainly desirable, a more crucial objective from the Turkish perspective is to generate added value for the economy by sourcing technology and know-how from partners in the Asia-Pacific through foreign direct investment. Japanese and Korean investment coming into Turkey starting with the 1980s has benefited the Turkish economy in this way, and more recently, Chinese investment is following the same path, with rising expectations on Turkey’s behalf due to the newly launched BRI, which promises to contribute significantly to turning Turkey into a transit hub between Europe and Asia. The article concludes by asserting that while Turkey’s relations with the Asia-Pacific are gaining significance, they take place in an increasingly interconnected and interdependent world, meaning that these relations are not meant to replace those with Turkey’s more established partners in the West, they are rather complementing them into a global network of trade and investment ties.