Focus on Turkey (Turkiye)

The geopolitical topic which I find most fascinating today involves Turkey.

A confluence of events, it political positioning and its strategic assets and alliances are worth noting.

President Erdogan fires the ‘central bank’;

President Biden labels Turkish actions in Armenia 1915 (a Christian country) as ‘genocide’;

Armenia remains a NATO ally yet has a Russian military base within it;

Turkey is friends with Russia (it likes its TurkStream pipeline);

Turkey and Russia have good economic relations;

Biden is pondering sanctions against Germany to hinder Russia’s Nord Stream 2 pipeline;

other assets such as the Baku–Tbilisi–Ceyhan pipeline conveniently bypass’ Armenia;

Turkey’s ejection from the F-35 Joint Strike Fighter program places pressure (spare parts) on maintaining their F-16 jets (the world’s 3rd largest fleet of that type);

Turkey and Pakistan relations are good and those with Iran are strong;

overnight Turkey launches new raids against militant Kurds in Northern Iraq;

while Turkey proceeds to build an alternative shipping route (the Istanbul Canal) to the Bosphorus,

and 2 crypto exchanges based in Turkey have collapsed this week.

See how it all ties in together and that’s only a part of it.

More to write later.

April 25, 2021
by Rob Zdravevski
rob@karriasset.com.au

Hope equals complacency

Something that I have difficulty explaining tells me that the Cyprus situation can’t end well. This feeling is biased by the complacency exhibited by European politicians.

Loosely, there is an assumption it will be fixed by somebody. Almost a similar feeling that permeated prior to Lehman Brothers collapsing. There is also a distancing by Germany, that someone else will save Cyprus.

Keep in mind that Angela Merkel has an election in September 2013. Why would she use German money to save Cyprus following the backlash she experienced in Greece.

But here come the Russians.

I have read that $40 or $50 billion of private Russian deposits sit within Cyprus’ offshore banking haven.

Here is how you would do a sovereign bailout deal.

For a $10 billion bailout, Russia gets to protect its citizens deposits in Cyprus, take over a huge slice of Cypriot debt (which they’ll eventually make a profit from, as it’s currently trading at 65 cents in the dollar) and take ownership or security over Cyprus’ Aphrodite gas field.

The Aphrodite gas field has natural gas reserves of about 7 trillion cubic feet (tcf) worth around $45 billion. That is enough gas to meet the energy needs of 7 million households for 20 years. Cyprus only has a population of 1 million people.

Incidentally, Aphrodite sits next to Israel’s larger Leviathan (16 tcf) and Tamar (8 tcf) fields.

It possibly makes for some interesting scenarios involving the politics of Israel, Lebanon, Turkey, Syria, Iran & Russia????

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