[Marxism] Turkey and Israel Do a Brisk Business

Louis Proyect lnp3 at panix.com
Fri Aug 6 08:29:37 MDT 2010

NY Times August 4, 2010
Turkey and Israel Do a Brisk Business

ISTANBUL — Israeli business executives here like to point out that most 
of the angry Turks who protested Israel’s deadly raid on a Turkish-led 
flotilla to Gaza this past spring do not know that their cellphones, 
personal computers and plasma televisions were made using parts and 
technology from Tel Aviv.

For Menashe Carmon, chairman of the Israel Turkey Business Council, such 
ignorance is a blessing for Israelis and Turks.

“Turks would find it very hard to boycott Israeli goods because you 
won’t find any in Turkish supermarkets,” Mr. Carmon said. “But most of 
the software Turks use in everything from cell phones to medical 
equipment is made in Israel. So unless Turks want to stop using their 
computers, boycotting Israel would mean punishing themselves.”

After the raid, in which nine Turkish citizens were killed on May 31, 
Turkey demanded an apology that it has yet to receive. It barred Israeli 
military planes from Turkish airspace, while its Islamist-inspired prime 
minister said the world now perceived the Nazi swastika and the Star of 
David together, according to the Hurriyet Daily News, a Turkish 
newspaper critical of the government.

Israelis, meanwhile, stung by the raw contempt of their former ally in 
the region, vowed to keep away from Turkey.

But when it comes to the real economy, business pragmatism is trumping 
political tensions. “No Israeli companies are leaving Turkey,” said Mr. 
Carmon, an Israeli entrepreneur who was raised in Istanbul. “It is 
business as usual and if anything, investment is growing.”

In the short term, the flotilla raid has produced some inevitable 
economic fallout. The widespread cancellations of holiday bookings by 
Israelis will cost Turkey some $400 million, analysts say. Turkey, 
meanwhile, said it would scrutinize all military cooperation, 
potentially depriving Israeli companies of billions of dollars in 
lucrative contracts.

Yet Israeli companies selling everything from computer software to water 
irrigation systems in Turkey insist that they have not been affected by 
recent events. In part, that is because they operate mostly in joint 
ventures with Turkish companies, making their Israeli identities 
invisible. It is a sign of the times that not a single Israeli company 
doing business here was willing to be quoted by name for fear that they 
or their Turkish customers could be hounded.

Bilateral trade between the two countries officially amounted to about 
$3 billion last year. But Israeli and Turkish business leaders say the 
economic ties are actually much larger.

The extensive business connections are largely camouflaged, they say, 
because many Israeli businesses use their Turkish partner companies to 
sell to the Arab world while Turkish companies use their Israeli 
partners as a gateway to American markets.

Even on the defense front, Turkish officials say that close cooperation 
between Israel and a Turkish military at odds with the Islamist 
government in Ankara is continuing behind the scenes. Israeli officials 
may be resigned to losing some immediate Turkish government contracts, 
but they remain confident that pragmatic interests will win out over 
ideological differences.

“While the politicians are trying to profit from the conflict, the army 
has remained remarkably quiet,” said Mehmet Altan, a leading Turkish 
columnist. “Both Israel and the Turkish military establishment want a 
secular Turkey, so they are fighting for the same thing.”

Within weeks of the flotilla raid, a Turkish military delegation arrived 
in Israel to learn how to operate the same pilotless aircraft often used 
by Israel to hunt Palestinian militants in the Gaza Strip. The $190 
million deal for the drones was not canceled, even as the Israeli 
instructors in Turkey were called home after the raid.

Doron Abrahami, consul for economic affairs at the Israeli Consulate in 
Istanbul, noted that before the flotilla clash, Israel’s military 
industry had teamed up with a Turkish partner to help modernize a fleet 
of 170 Turkish tanks in a project valued at $700 million. He said the 
Israeli and Turkish partners were now shopping around their expertise to 
other countries.

“Business is business,” he said, showing off an invitation dated July 
15, co-signed by economic agencies in Turkey and Israel just weeks after 
the Israeli raid, inviting Israeli and Turkish companies to bid for a 
jointly financed research and development project, one of more than 20 
such efforts he said were under way.

In 1949, Turkey was one of the first countries to recognize Israel 
shortly after the country declared its existence in 1948. The two have 
forged strong military and trade ties, but diplomatic and political 
relations have deteriorated in recent years, as alarm has grown in the 
United States and Europe that Turkey is turning its back on the West and 
courting Israel’s enemies like Iran.

In January 2009, the Turkish prime minister, Recep Tayyip Erdogan, 
stormed out of the World Economic Forum in Davos, after clashing with 
the Israeli president, Shimon Peres. In January of this year, Israel 
apologized after its deputy foreign minister insulted the Turkish 
ambassador by forcing him to sit on a lowered sofa.

Yet for all of the recent episodes of mutual recrimination, Turkish and 
Israeli business people remain close.

Necat Yuksel is export manager at Naksan Plastik, a large Turkish 
plastic packaging producer in Gaziantep, in Turkey’s southeast, that 
imported some $40 million worth of plastic chemicals from Israel last 
year. He said sales from Israel showed no signs of abating, even as the 
recent clash with Israel had exerted a damaging psychological effect on 
both countries.

His Israeli customers are now wary of travelling to Turkey, he said, and 
his best Israeli client now refers to him as “Erdogan,” after Turkey’s 
prime minister. Yet not a single contract had been canceled. Nor has his 
company shelved its plans to establish a factory in Israel.

He proudly cited many advantages to doing business with Israel, 
including geographic proximity and a shared mentality. “All the problems 
are between the politicians,” Mr. Yuksel said. “Israelis, hot-tempered 
and stubborn, are just like us Turks.”

Mr. Yuksel, who has been visiting Israel for more than a decade, argued 
that Israeli executives were far more influenced by recent political 
events than Turks. “For us it comes down to profits,” he said. “For the 
Israelis, it’s emotional.”

Yet most Turks are adamant that Israel needs Turkey far more than Turkey 
needs Israel. Sinan Ulgen, a leading economist in Istanbul, argued that 
Israel had far more to lose than Turkey from severed ties. Sales to 
Israel made up about 1.5 percent of Turkey’s total exports of $102 
billion last year, making it Turkey’s 17th biggest market, according to 
the State Statistics Agency in Ankara. Israel exported some $1.04 
billion to Turkey last year, making Turkey its eighth largest export market.

At the political level, Mr. Ulgen noted that when ties were strong, 
Turkey provided an isolated and tiny Israel with a large Muslim ally in 
a perilous region.

But Rifat Bali, a Turkish Jew who had written widely on Turkish-Israeli 
relations, countered that bad relations with Israel were riskier for 
Turkey by undermining its relations with the United States. They also 
stifled Turkey’s aspirations to be a regional power by depriving Turkey 
of the ability to play a mediating role. He said Israel was one of the 
only countries willing to sell arms to Turkey with no strings attached.

“Both Turkey and Israel,” Mr. Bali said, “need each other far more than 
either is willing to admit.”

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