How ISIL activity is bad for Turkey

Of the $30 billion Iraqi imports, a third is from Turkey. Gaziantep alone provides around a fifth of Iraq’s imports. So Iraq by itself is important for Turkey. Now two things are happening at once. First of all, it is getting increasingly harder to send trucks down to Iraq. Secondly, Iraqi import demand is declining rather rapidly as Iraq transforms into a war zone. The decline in Iraqi orders has now reached 40 percent, and doesn’t seem like it will stop there, declining orders and a lack of transport corridor to send the goods. That’s bad for Turkey and especially bad for provinces neighboring Iraq and Syria.

Turkish firms are getting shut out of the Iraqi market. That is also bad. Have you ever compared the goods Turkey sells to the West and to Iraq? One thing stands out clearly: Exports to the West are more sophisticated than exports to Iraq. We sell just cement as construction material to Iraq. Food industry exports are mainly comprised of flour. No large market for Turkish-made cars or washing machines in Iraq yet either. There are no roads, no highways and of course no reliable source of electricity. I first learned about the concept of a neighborhood electricity generator in Arbil. You come together with your neighbors and set up an electricity generator for your own use. A sharing economy has developed in Iraq out of necessity. Some Turkish towns were like that 50 years ago. That is life as usual now in Iraq.

I remember a Turkish generator manufacturing company operating in Iraq, mostly in the North. The company grew considerably due to the Iraqi market, I have to confess. However, generators seem to be the most sophisticated item Turkey has been selling to Iraq. In a country like Iraq, you can only sell the basics. Iranian...