Turkish Exporters See Political Strife With Saudis Hitting Trade

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Saudi Arabia is hindering the entry of goods from Turkey, Turkish companies say, suggesting that political tensions between the regional powers are increasingly spilling over into trade.

The claims prompted a Turkish official familiar with the issue to warn on Thursday that Ankara doesn’t rule out an appeal to the World Trade Organization; while the world’s largest container line has warned clients about likely disruption.

Cargo from Turkey to Saudi ports “will be subjected to possible import bans and/or slowed various customs clearance,” the Turkish agent of A.P. Moller-Maersk A/S said in a Sept. 29 email.

Transiting cargo over land has been blocked, according to Kemal Gul, the owner of Gulsan Transport, a logistics firm based near Turkey’s southern border with Syria, who says the pandemic has given Saudi authorities an excuse to restrict access. “We’re not having such issues with Iran or Iraq. It seems to me they’ll now hamper sea transport.”

Gul, also a board member of a national transport association, said he’s receiving frequent complaints about this issue from other logistics companies.

Saudi Arabia is Turkey’s 15th biggest export market, with sales led by carpets, textiles, chemicals, grains, furniture and steel amounting to $1.91 billion in the first eight months of the year. That’s a drop of 17% from 2019, some of which is attributable to the virus that has hammered global trade. But Saudi statistics show the value of Turkish imports had already been declining each year since 2015.

Khashoggi Killing

The two countries have clashed over recent years, with relations plummeting to a low point after the 2018 murder of Washington Post columnist Jamal Khashoggi, a critic of the Saudi leadership, at the kingdom’s consulate in Istanbul. Many of their differences center around the Saudi monarchy’s resistance to the use of their shared dominant religion, Islam, as the foundation for a popular political movement,, which Turkish President Recep Tayyip Erdogan embodies.

Saudi Arabia’s Center for International Communication said on Saturday that “the official authorities in the kingdom have not placed any restrictions on Turkish goods, and the bilateral trade between the kingdom and Turkey has not witnessed any notable decline.”

Saudi Arabia’s customs department didn’t respond to a phone call or WhatsApp messages seeking comment.

On Thursday, Turkish products were still available in Saudi Arabia, including perishable goods like dairy and deli meat. Several Saudi businessmen denied facing a ban on Turkish imports, though some said they’ve faced significant customs delays while bringing in goods that originate from or transit through Turkey. The slowdown dates back to at least 2019, they said, speaking anonymously because of the political sensitivity of the topic.

Regional Flashpoints

Other Saudi firms said it’s business as usual for them.

“We’ve been hearing this rumor for three years and nothing ever happened,” said Ahmed Saeed, an employee at Chakra, a store selling Turkish-made furniture in Riyadh. “We just received a shipment last week and all of our shipments are on track.”

Erdogan’s backing of former Egyptian President Mohamed Mursi and other Muslim Brotherhood-inspired movements across the region prompted Saudi Arabia, the United Arab Emirates and Egypt to align in an anti-Turkey bloc. That’s left Riyadh and Ankara on opposite ends of the conflict in Libya as well as an ongoing feud between Qatar and a four-nation Arab alliance featuring Saudi Arabia.

Emre Eldener, the chief executive officer of Istanbul-based Kita Logistics, said trade tensions increased after Khashoggi’s murder.

“The export outlook has worsened in the past few months,” he said. “What is in place is a systematic policy of intimidation against Turkish companies.”

Kita had an office in Saudi Arabia, and Eldener says business was good for a few years. “After the murder, they refused to renew our license there, so we had to shut down the office,” he said.

Kita currently has shipments on the way to Saudi Arabia. “We’ll see how it goes,” Eldener said.

The Council of Saudi Chambers chairman, Ajlan Alajlan, tweeted on Saturday “The boycott of everything Turkish - goods, investments and tourism - is the responsibly of every Saudi, whether a trader or a consumer, in a response to the continued hostility of the Turkish government towards our leadership, country and citizens.”

©2020 Bloomberg L.P.