Key projects in focus as Erdoğan visits Iraq
Discussions in Baghdad are anticipated to revolve around crucial security matters, economic development and issues related to water and energy, as well as the $17 billion Development Road project
Recep Tayyip Erdoğan’s trip to Iraq after over a decade is expected to bolster bilateral relations and add momentum to a vast infrastructure project pitched as a link between Asia and Europe.
Erdoğan is scheduled to arrive in Baghdad today, marking his first trip to the Iraqi capital in 11 years. He will also travel to Irbil, the capital of the Kurdistan Regional Government (KRG), a semi-autonomous entity controlling Iraq’s north.
Iraq is Türkiye’s key trade ally in the region although relations have been strained over what Ankara sees as Baghdad’s insufficient cooperation in its fight against the PKK terrorist group, as well as a row over oil exports.
Discussions in Baghdad are anticipated to revolve around crucial security matters, economic development and issues related to water and energy.
A focal point of the visit will undoubtedly be the Development Road, a $17 billion (TL 552.26 billion) project designed to connect the Basra Gulf hinterland to Europe via Türkiye.
The project aims to link the Grand Faw Port, a major commodities port in Iraq’s oilrich south, to Türkiye’s border and onward to Europe through railways and highways.
Construction of the Grand Faw Port, slated to be the largest in the Middle East, is currently underway and expected to be completed by 2025. It is the first phase of the project and is located at the mouth of the Shatt al-Arab, where the Tigris and Euphrates rivers converge before flowing into the sea.
The project includes railway and road lines extending from the port through cities such as Diwaniyah, Najaf, Karbala, Baghdad and Mosul to the Turkish border. It aims to provide access from the Turkish border to the Port of Mersin and reach Europe via Istanbul by road.
The design of the route traversed by the project is carried out by PEG Infrastructure, an Italian company, and after Mosul, the Development Road will enter Türkiye through Ovaköy.
Trade Minister Ömer Bolat stated several trade pacts would be signed between the countries during Erdoğan’s visit.
Türkiye aims to reach $15 billion in exports to Iraq in the near future and $20 billion in 2030 with the completion of the Development Road, Bolat told Anadolu Agency (AA).
Recep Tayyip Erdoğan’s trip to Iraq after over a decade is expected to bolster bilateral relations and add momentum to a vast infrastructure project pitched as a link between Asia and Europe.
Erdoğan is scheduled to arrive in Baghdad today, marking his first trip to the Iraqi capital in 11 years. He will also travel to Irbil, the capital of the Kurdistan Regional Government (KRG), a semi-autonomous entity controlling Iraq’s north.
Iraq is Türkiye’s key trade ally in the region although relations have been strained over what Ankara sees as Baghdad’s insufficient cooperation in its fight against the PKK terrorist group, as well as a row over oil exports.
Discussions in Baghdad are anticipated to revolve around crucial security matters, economic development and issues related to water and energy.
A focal point of the visit will undoubtedly be the Development Road, a $17 billion (TL 552.26 billion) project designed to connect the Basra Gulf hinterland to Europe via Türkiye.
The project aims to link the Grand Faw Port, a major commodities port in Iraq’s oilrich south, to Türkiye’s border and onward to Europe through railways and highways.
Construction of the Grand Faw Port, slated to be the largest in the Middle East, is currently underway and expected to be completed by 2025. It is the first phase of the project and is located at the mouth of the Shatt al-Arab, where the Tigris and Euphrates rivers converge before flowing into the sea.
The project includes railway and road lines extending from the port through cities such as Diwaniyah, Najaf, Karbala, Baghdad and Mosul to the Turkish border. It aims to provide access from the Turkish border to the Port of Mersin and reach Europe via Istanbul by road.
The design of the route traversed by the project is carried out by PEG Infrastructure, an Italian company, and after Mosul, the Development Road will enter Türkiye through Ovaköy.
Trade Minister Ömer Bolat stated several trade pacts would be signed between the countries during Erdoğan’s visit.
Türkiye aims to reach $15 billion in exports to Iraq in the near future and $20 billion in 2030 with the completion of the Development Road, Bolat told Anadolu Agency (AA).
Iraq was Türkiye’s third-largest export destination in 2023. Bolat said that the bilateral trade volume stood at $24.2 billion in 2022 and $19.9 billion in 2023.
“Exports to Iraq fell 7.2% year-over-year in 2023 to $12.8 billion, and imports from Iraq decreased 31.1% to $7.2 billion during the same period,” he said.
Bolat said exports rose 24.5% to $3.4 billion annually in the first three months of 2024, while imports plummeted 46.2% to $835 million.
Bolat stressed that Iraq stands out regarding its economic and trade relations with Türkiye and that the share of exports to Iraq over the last decade has been 5% and above.
REGIONAL TRANSIT HUB
The project, initially dubbed the “Dry Canal” but later renamed the “Development Road,” will span nearly 1,200 kilometers (745 miles) and is envisioned to serve as a crucial transit route for regional trade, fostering a non-oil sustainable economy in Iraq.
Once completed, it is expected to significantly reduce shipping times and streamline trade between Asia and Europe.
Bolat said the projects aim to facilitate trade, customs, visa and transit procedures in transportation between the Gulf countries and Europe.
He said the project will be completed by 2029, and the railroads and land roads are planned to be in operation in 2030.
“For the Development Road Project, some 1,176 kilometers of railroads suitable for high-speed freight trains and passenger trains will be constructed, as well as 1,190 kilometers of highways,” the minister stated.
“The project is estimated to positively impact Turkish exports to Iraq and our logistics capacity, as the roads are planned to pass through various provinces of Iraq, the city of Al-Anbar, and the Persian Gulf.”
“The project is expected to stimulate exports to the Middle East and Gulf regions, as well as Southeast Asian countries, and have a positive impact on our export figures,” he added.
Bolat said the project would also influence Türkiye’s exports to target countries, helping fulfill the highly important Far Countries Strategy.
SECURITY ISSUES
Şerafettin Aras, the head of the International Transporters Association (UND), said the Development Road is critical to Türkiye for its trade with Iraq, the United Arab Emirates (UAE), Qatar, Kuwait and Oman.
There are 200,000 road trips to those countries annually, he said, adding if security problems in southern Iraq are resolved, the project could turn into an effective alternative corridor, especially due to the Israeli-Iranian conflict.
Security concerns remain a major challenge.
The PKK maintains bases in Iraq. It has a foothold in the northern region, where the central Iraqi government has little influence.
The PKK is not designated a terrorist organization in Iraq. It is listed as a terrorist group by Türkiye, the United States, the United Kingdom and the European Union.
Türkiye often launches strikes against targets in the region, which Baghdad has complained is a breach of its sovereignty.
Erdoğan has said that his country is determined to end the PKK’s presence in Iraq this summer.
Eliminating security concerns in the region will open new horizons for the two countries to expand trade ties, which would, in turn, achieve important progress for the Development Road, Bolat said.
The project, which includes highways, railways, energy transmission and communication lines and is planned to be completed in three stages in 2028, 2033 and 2050, will affect a wide region from Europe to Gulf countries.
INTENSE DIPLOMATIC TRAFFIC
Announcing the project last May, Iraqi Prime Minister Mohammed Shia Al Sudani said it would change reality toward establishing a strong economy with employment, financial leverage and increased gross national product.
Since then, there has been intense diplomatic traffic between Ankara and Baghdad regarding the project, which was an important aspect of Foreign Minister Hakan Fidan’s visit to Iraq last August.
Over the past year, the two countries have held high-level talks and technical meetings to enhance cooperation between their transportation ministries.
Representatives of railway administrations from Türkiye, Iraq, the UAE and Qatar met in Ankara last October.
Transport and Infrastructure Abdulkadir Uraloğlu earlier this month said efforts under the Development Road are continuing rapidly and stressed the sides decided to establish a mechanism similar to the Ministers Council. Ankara aims to include the UAE and Qatar in the council.
Türkiye, Gulf countries and China are expected to contribute to the financing and completion of the project.
During his visit to the UAE in February, Erdoğan indicated that Türkiye, the UAE and Iraq are the main actors in the project, which he said would become a new Silk Road for the region.
Within the scope of the project, Türkiye plans to invest in 615 kilometers of new railway lines for the 2,088-kilometer railway link passing through the country and 320 kilometers of new highways for the 1,912-kilometer road corridor.
While 439 kilometers of the existing railway network are in place, 1,034 kilometers are under construction, and 615 kilometers are planned.
OIL EXPORTS DISPUTE
Erdoğan’s visit is also expected to weigh on the dispute over oil exports from the KRG, which has been a particular sticking point.
The Iraq-Türkiye oil pipeline, which once handled about 0.5% of global oil supply, has been offline since March 2023, when Ankara halted flows following an arbitration ruling by the International Chamber of Commerce (ICC).
The ICC said Ankara should pay Baghdad damages of $1.5 billion over what it said were unauthorized exports by KRG between 2014 and 2018. Türkiye, on the other hand, said the ICC had recognized most of Ankara’s demands. Its Energy and Natural Resources Ministry said the chamber ordered Iraq to compensate Türkiye for several violations concerning the case.
About 450,000 barrels per day of crude once flowed through Iraq’s northern route via Türkiye, and its closure has led to the loss of roughly $11 billion to $12 billion for Iraq, the Association of the Petroleum Industry of Kurdistan (APIKUR) estimates.
KRG exports flow through a pipeline to Fish-Khabur on the northern Iraqi border, where the oil enters Türkiye and is pumped to the port of Ceyhan on the Mediterranean coast.
Talks on resuming exports have stalled. Last month, Iraq’s Oil Ministry said foreign oil firms operating in KRG are partly to blame for the delay in resuming crude exports after failing to submit contracts for revision.