Hazar Raporu - Issue 02 - Winter 2012

Caspian states, (bar Turkmenistan, for
which WTO data are not available)
T urkey is the only ECO member which figures
among the other members’ top five partners,
notably in trade with Azerbaijan, where it is
the third most important source of imports.
The emergence of China as a significant global
economic player has also altered the external
environment in a way quite unforeseen when
ECO was set up. This has been especially marked
in the case of Kazakhstan and Turkmenistan,
both of which have built, or are building, large
natural gas pipelines to China,16 besides
increasing their imports from Asia’s rising
economic power.
Economic and technical factors help to
explain ECO’s apparent failure to take
off as a trading group. In the Caspian
region, its members are mainly primary
producers, exporting oil and gas to the
rest of the world (originally, Russia) rather
than to one another. There is some degree
of complementarity between the Turkish
and other ECO economies, in that Turkey
can export manufactured products in
exchange, but this is an exception.
T he paucity of transport links is a further
problem, although this is now being tackled by
the construction of the Kars-Bitlis-Baku railway,
connecting Turkey with Azerbaijan via Georgia.
16 Vladimir Socor, ‘China to Increase Central Asian Gas
imports through Multiple Pipelines’, Eurasia Daily Monitor,
Vol.9, No.152 (9 August 2012) and ‘Kazakhstan Expands Gas
Transit Pipeline Capacities and Own Exports to China’, ibid,
Vol.9, No.153.
In general, the Caspian states have
preferred autarchic rather than
internationally oriented development
strategies, relying on their oil and gas
reserves to finance imports, and putting
the development of regional trading links
well down in the list of priorities.
Besides this, political factors have
posed crucial obstacles to the effective
development of ECO. Here, Iran appears
to be the major problem, and the odd
man out in ECO, since this is the only
regional club of which it is a member.
Hence, its government is accused of trying
to exploit the organisation as a means
of drumming up political support in the
face of its growing international isolation.
Critics accuse the Iranian regime of trying
to use ECO as a propaganda machine
for promoting its own controversial
causes - much as it used a meeting of the
Non-Aligned Movement in Tehran in
August 2012, causing raised eyebrows in
other ECO governments. In September
2012, ECO discussed plans to establish a
Parliamentary Assembly, prompting fears
that Iran sought to turn the body ‘into
another West-bashing club’ rather than a
forum for discussing the real issues in the
region. 17
Bilateral relations between Iran and other
ECO members are also damaged by
the Iran’s close relations with Armenia,
putting it at odds with both Turkey and
Azerbaijan, besides sharp differences
between Tehran and Ankara in policies
towards Syria. Turkey has supported
international efforts to persuade Iran to
17 Bozkurt, op.cit.
116 114