Analysts said that China aims to build an alliance with a country that is at odds with the United States to gain more global political influence in the future.
China plans to provide some financial aid to Turkey, including the purchase of some yuan-denominated bonds, the South China Morning Post reported. The Chinese newspaper quoted Chinese analysts as saying that Beijing’s response to Ankara’s moves to connect with “new friends” in an attempt to collapse the Turkish lira came from a political rather than an economic point of view.
Analysts pointed to the official Chinese news agency reporting the sudden change of tone of Turkish President Recep Tayyip Erdogan on the repression in the territory of Xinjiang, and told his Chinese counterpart Xi Jinping, that Muslim minorities “Uighurs” live happily in Xinjiang, a position described by some observers that he turned 180 degrees from the last statements of the Turkish Foreign Ministry which described the treatment of Turkish-speaking Uighurs as “a great shame on humanity”.
But Beijing cannot provoke Washington
But Beijing is set to carefully consider its options in helping Turkey and will not offer a large bailout package because of the risk of wider support, which will further provoke the United States.
Tensions between US and Turkey led to the loss of the Turkish currency nearly 20% of its value against the US dollar last year, and continued to decline since the beginning of this year.
Lira threats, the stock market and the economy have raised serious concerns for Erdogan and his government, prompting them to seek new economic friends from traditional US adversaries.
Aidan Yao, a senior economic analyst specializing in emerging markets in Asia, said the opportunity for the Chinese government to extend aid to Turkey was large but would be based on political rather than economic considerations given the risks associated with such a move.
“As with any loan or bond issue, there is always the possibility of default, and this risk will be particularly high when a country is in the middle of a storm,” Yao said.
Urgent concessions
“Turkey remains committed to the one-China policy,” Erdogan was quoted as saying by Xinhua News Agency, stressing that “the fact that ethnic residents live happily in the Xinjiang Autonomous Region because of China’s prosperity is a fixed fact.
Turkey will not allow anyone to tamper its relations with China, said Erdogan. However, Erdogan expressed his willingness to enhance mutual political trust and security cooperation with China to counter extremism, the agency said.
Erdogan warned all those seeking to “exploit” the Xinjiang issue to create tensions with China, reported the Chinese agency. But it is likely that Beijing will not only make these remarks in return for some assistance to Turkey, but will also seek to benefit in the long run.
Analysts said that China aims to build an alliance with a country that is at odds with the United States to gain more global political influence in the future.
Young Friends
Sun Shinn, a lecturer in Chinese and East Asian business at King’s College London, said that Beijing’s assistance to Ankara was part of “unifying the ranks of some younger brethren” in the face of US trade threats. However, any help from China would be a political gesture rather than a major support for the Turkish lira.
The Turkish lira remains fragile due to lack of market confidence in Erdogan’s government’s willingness to take measures to support the Turkish currency, Shinn said.
Article first published in Arabic on Al Arabiya Arabic.
