Turkish President Recep Tayyip Erdogan is a leader known for his frequent flip-flops on foreign policy matters. Yet since the White House issued an executive order to reimpose certain sanctions on Iran, Erdogan has been persistent in his decision not to fall in line. At the 73rd session of the United Nations General Assembly in New York, Turkish Foreign Minister Mevlut Cavusoglu announced one more time that Turkey would not support US sanctions on Iran.
The proposed US sanctions have two rounds. The second round, which will force the SWIFT financial messaging system to disconnect Iranian banks from the world, is to go into effect early November. The second round is also targeting Iran's energy and financial sectors, casting a wide net over the Iranian Central Bank and state banks, oil exports, ports and the shipbuilding industry. It returns Iranian entities and businessmen to the US government’s blacklist — meaning any third-country bank, individual or company that deals with them would risk hefty fines and significant sanctions that could cut them off from US dollar-dominated global markets.
The Turkish case here presents an interesting outlook. First, as Al-Monitor columnist Fehim Tastekin highlighted, neither the Turkish-Iranian trade volume nor investments benefited from the lifting of sanctions in 2015. To the contrary, Turkish energy-related imports peaked between 2011-2012, along with hundreds of millions of dollars worth of gold exports (sustained through Obama era waivers) in the same years. Turkish-Iranian energy-related trade volume was higher under sanctions.
Second, Turkish banks and Iranian-Turkish businessmen Reza Zarrab have carried out one of the biggest sanctions evasion schemes in recent US history.
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