Category: Business

Southern flank is strategically important to Russia

Gulnara Inandzh

Director, Ethnoglobus

An International Online Information and Analysis Center,

(ethnoglobus.az), editor of Russian section of Turkishnews American-Turkish Resource website www.turkishnews.com , mete62@inbox.ru

The North Caucasus, which is bordered by two regional states, Azerbaijan and Georgia, is strategically important to Russia. For the preservation of peace in the southern portion of the country, the federal center along with the use of force is conducting economic reforms meant to provide new work places, an improvement in the standard of living of the population, and a reduction in the amount of out-migration.

Economic weakness and a lack of social development in such a strategically important region represent a serious danger for the state integrity of Russia, because among the reasons that its citizens and especially young people in the south are turning to radical Islamist groups are poverty and unemployment. Consequently, Moscow believes that changes in these areas will turn people away from radicalism and return them to normal civic life.

Over the last several years, the Russian government, with this goal in mind, has begun the planned development of this region by means of the involvement of investors, including foreign ones. At the same time, however, considering the efforts of foreign governments to promote separatism, including in the North Caucasus, Russia has been quite cautious about any foreign role in the economy of that region and not allowed outside investors access to its economy. In particular, Turkish investors were pushed out of the region and Circassians now living abroad were not provided with opportunities to invest in their historical homeland.

Because it lacks geopolitical ambitions in the North Caucasus and because it has no desire to become the instrument of outside games in the region, Azerbaijan has become a successful and trusted source of capital investment in the economy of the south of the Russian Federation. Many factors have contributed to this, including Baku’s economic potential, the similarity of outlooks, natural infrastructure, a major market, among others.

The 2010 state border agreement between Baku and Moscow promoted the opening of the North Caucasus economic zone for Azerbaijani business. In the summer of 2011, A.G. Khloponin, the deputy head of the Russian government and the special representative of the Russian President to the North Caucasus Federal District, together with the heads of all North Caucasian republics, came to Baku to discuss Azerbaijani investments. Immediately after this, Azerbaijan’s economic development minister Shahin Mustafayev visited seven republics of the North Caucasus. That was followed by a series of business forums and meetings of businessmen. [1]

Reflecting its particular attention to economic cooperation with Azerbaijan in this area, the plenipotentiary representation of the Russian President in the North Caucasus created a special council for control over the execution of the decisions concerning the federal subjects in the region, and it has plans to open a representation of this plenipotentiary in Azerbaijan. As deputy plenipotentiary representative Sergey Subbotin observed, “Before the leaders of the North Caucasus Federation District have been given the task of developing relations with Azerbaijan and the time has come for checking the effectiveness of the measures taken to address this task. The effective resolution of all tasks depends in the first instance on effective control.” [2]

The involvement of Azerbaijani business is especially evident in the Stavropol and Krasnodar regions of Russia. In 2009, for example, Azerbaijan occupied third place in the amount of foreign trade with Stavropol, with its total being 123.3 million US dollars or 8.7 percent of the trade turnover of the kray. Azerbaijani trade turnover with Krasnodar in that year was 71.4 million US dollars.

Azerbaijan’s Azersun Holdings Company in the following year, to give but one example, opened a tea processing factory in Belorechensk in Krasnodar kray valued at more than three million US dollars annually. That company has begun construction of a new preserves factory for a similar sum. And that company alone has invested 22 million US dollars in the development of the infrastructure of Krasnodar kray. Furthermore, Azerbaijan’s Matanat-A company in September 2011 began building a construction materials factory in Krasnodar’s Uspensky District, a project estimated to cost 30 million euros.

Daghestan has the largest trade turnover with foreign countries, but the involvement of Azerbaijani business in that neighboring republic still remains at the stage of discussions. After the signing in 2010 of the inter-governmental agreement on cooperation in the rational use and protection of the water resources of the Samur River, the construction of a hydroelectric station on that river should permit the development of the infrastructure of Daghestan and Azerbaijani districts bordering it.

No less interesting is the project of the construction of a Trans-Samur highway (Derbent-Akhty-Rutul, across the Bagos pass by tunnel, and the construction of an Avar-Kakhti road connecting Botlikh, Buynaksk and Makhachkala) in order to supply southern Daghestan and Azerbaijan. The new highway will provide access into and out of Southern and Mountainous Daghestan. [3]

Azerbaijani capital is involved in the agricultural and construction sectors of the North Caucasus Federal District. A Stavropol company has reached agreement with the Azerbaijani agricultural ministry about a tender to sell agricultural technology produced there to the Azerbaijani Republic.

There has also been cooperation in tourism and resorts. Because the North Caucasus has resorts developed in Soviet times and even further back, Azerbaijani businessmen are finding that Moscow is extremely interested in involving them in the redevelopment of these facilities. A. Khloponin has suggested that Moscow will provide state guarantees and insurance for investments in this area. [4]

It is clear that there is a need to establish free trade zones in this region in order to allow for the freer flow of goods and services and workers between southern Russia and Azerbaijan and to provide a framework for attracting additional Azerbaijani investors. And that may happen given that the Russian side is seeking to move economic relations between Azerbaijan and the North Caucasus Federal District beyond just trade. All this shows—and this is the key point—that Russia now trusts its southern flank to Azerbaijan.

Notes

[1] See (accessed 14 November 2012).

[2] See http://fineko/abc.az (accessed 14 November 2012).

[3] See https://www.turkishnews.com/ru/content/2012/11/06/ (accessed 14 November 2012).

[4] See http://fineko/abc.az (accessed 14 November 2012).

sourse ADA Biweekly Newsletter

December 9, 2012
Turkey Donates $50M for Nyala Hospital

Khartoum – The Minister of Finance and National Economy has reiterated its commitment to indigenizing medical treatment.

The Minister of Finance Ali Mahmoud while meeting at his office a delegation from the Ministry of Health and International Cooperation Organization, pledged to consider best ways to operate Nyala hospital constructed at $50million dollars donated by Turkey.

He commended Turkey’s efforts to support health sector in the country, the hospital which was established according international standards aims to serve efforts to indigenize medication reduce burden of cost of treatment overseas for the residents of the state. Mahmoud expected that the hospital will also provide services to neighboring countries.

Bahar Abu Girda, a doctor, announced that construction of the buildings of the hospital and installment of equipment was finished, expecting the hospital will be operational two days, adding that the Turkish prime minister will grace the event after signing a protocol between ministries of health in the countries. Girda said operation would start with joint staff from both sides for a period of five years to exchange experience before the hospital is handed over to Sudan.

The Turkish side is committed to supply more than half of operation costs for said period and contribute along with the administration of the hospital to provide qualified medical personnel for the agreed upon period of five years.

via Sudan Vision Daily – Details.

December 9, 2012
Iran-Turkey trade hits $20 billion in 10 months

Iran-Turkey trade hits $20 billion in 10 months

Economic Desk

The value of trade exchanges between Iran and Turkey has reached to 20 billion dollars in the first ten months of 2012, IRNA news agency reported on Saturday.

The value of bilateral trade between the two neighbors has increased more than 45 percent in comparison to the same period of last year.

Turkey has exported more than 9.3 billion dollars worth of goods to Iran in the first ten months of 2012, while it imported around 10.5 billion dollars from the Islamic Republic in the mentioned period.

Iran and Turkey have sharply increased the level of their trade ties over the past years. In 2000, the level of bilateral trade stood at only around USD one billion, but in 2010, it exceeded USD 10 billion. The figure hit USD 16 billion last year.

The two sides seek to raise the value of their bilateral trade to USD 30 billion by 2015.

Iranian First Vice President Mohammad-Reza Rahimi has announced recently that the speed of trade exchanges between Iran and Turkey has accelerated and will soon reach the targeted goal of 30 billion dollars per year.

Earlier this month, Turkish Deputy Prime Minister Ali Babacan confirmed that Iran was selling natural gas to Turkey for payment in Turkish Liras in Turkey that were later converted into gold before brought to their homeland.

via Iran-Turkey trade hits $20 billion in 10 months – Tehran Times.

December 9, 2012
Turkish Wine Renaissance Promotes Rock-Aged Whites

Lucien Arkas, chairman of Arkas Holding A.S., discusses his LA Wines property at Swissotel Grand Efes in Izmir. Arkas bought out his partners in 2010, renaming it LA Wines. Its vineyards are now certified organic. Photographer: Elin McCoy/Bloomberg via Bloomberg

At a tasting in a World War II cement bunker in Gali winery’s vineyards on Turkey’s Gallipoli peninsula, the 2010 bright, juicy cabernet franc-merlot blend is a big and very pleasant surprise.

One of several dozen small boutique wineries founded in the last few years, Gali is part of the country’s growing wine renaissance. It was the first stop on recent tasting tour that left me highly enthusiastic about Turkey’s wine potential.

After tramping through Gali’s vineyards, with windy views of the blue Aegean Sea, the Dardanelles and Sea of Marmara, I savor the delicious red again on owner Hakan Kavur’s stone terrace with oregano-accented lamb slow-braised in local olive oil.

When it comes to wine, you’re never far from history in this country of more than 800 grape varieties. Though many new vintners in Turkey’s seven wine regions champion international ones like chardonnay and cabernet, I discover the best wines so far come from a handful of Turkish grapes with hard-to-pronounce names like okuzgozu (oh-cooz-goe-zoo) and kalecik karasi (kah- le-djic-car-ah-ser).

Indiana Jones

The centerpiece of my 10-day trip is the EWBC Digital Wine Communications Conference in Izmir on the Aegean. One of the main speakers, Patrick McGovern of the University of Pennsylvania Museum — who is called the Indiana Jones of wine archeology — makes the case for Turkey as wine’s birthplace.

His presentation covers the country’s several thousand years of flourishing drinking culture under the Hittites, Assyrians, Lydians and Byzantine Christians.

Despite that history, Turkey’s 100-plus wineries face serious challenges in a land with a 99 percent Muslim population. The government discourages consumption through high taxes and advertisement bans, and this year prohibited internet sales.

None of that stopped Izmir native Lucien Arkas, chairman of Arkas Holding A.S., owner of 55 companies, and a major art collector, from investing in a 1,168-acre property 45 minutes southeast of Izmir.

As we talk over small glasses of Turkish tea in between the conference’s panels and tastings, Arkas, 67, smiles and shrugs, “People still smoke and drink. Twenty million tourists want to go to the beach, and sip wine.”

LA Wines

The genial, round-faced Arkas, in a dark blue Zegna suit, says he purchased a small share in the 2005 project sight unseen, but bought out his partners in 2010. Now the vineyards are certified organic, and he renamed the winery LA Wines.

I like LA’s pure-tasting 2010 Mon Reve chardonnay/chenin blanc ($16), with its hint of pears and tropical fruit, and the earthy 2010 Mon Reve Tempranillo. I sip them at the Arkas museum in Izmir, while studying Turkish photographer Ahmet Ertug’s stunning pictures of European opera houses and libraries.

Like Kavur, Arkas is wedded to European grape varieties rather than his country’s own.

Happily, both avoid the excessive-oak-aging embraced by many of Turkey’s small estate wineries. Case in point: The Gulor winery founded in 1993 by Guler Sabanci, the chairman of her family’s Sabanci Holding (SAHOL), the second largest company in Turkey, and the first to plant international grapes. Gulor makes a clean, fresh 2012 G Sauvignon Blanc ($11), but its pricier reds taste more of wood than fruit.

Local Grapes

Some of the biggest (and oldest) wineries are now refocusing on indigenous grapes. Doluca dates from 1926, and at its huge new modern cellar hidden away in a vast gray industrial park a 90-minute drive from Istanbul, its French winemaker Pascal Lenzi pours barrel samples of a crisp, lemony white 2012 Narince (nah-rin-djeh) and a lively easy-drinking 2012 Kalecik Karasi, the Turkish answer to gamay, the grape of Beaujolais.

But a few days later, on the high desert plateau of Cappadocia in central Anatolia, I find the most exciting wines of my stay at the traditional Kocabag winery outside Uchisar. The spare, windswept expanse of landscape, where herds of wild horses once roamed and patches of grapevines sprawl like low bushes as they did thousands of years ago, seems vast and timeless.

“My grandfather started in 1972 in a simple cave carved from rock,” explains third generation Mehmet Erdogan, as he leads the way into the winery. The stone arches and fermenting and aging vats are all carved from soft, easy-to-work tuff rock made of compressed volcanic ash.

Lamb Kebab

At a wine bar and shop overlooking the strange rock formations in Uchisar’s Pigeon Valley, Erdogan pours Kocabag’s two whites and three reds.

My white pick is tart, appley 2011 Narince, with its floral aromas and wet stone taste. Among reds, the stars are 2011 Kapadokya ($14), a complex earth-and-black-cherry blend of bogazkere and okuzgozu and the subtle, soft cassis and fruit 2010 Okuzgozu ($16), which is perfect with lamb shish kebab. I had to have a second glass.

(Elin McCoy writes on wine and spirits for Muse, the arts and leisure section of Bloomberg News. The opinions expressed are her own.)

Muse highlights include Jeremy Gerard on theater and Martin Gayford on art.

December 7, 2012
Russian carmaker to assemble in Turkey

Russia’s GAZ major carmarker has launched a JV with Turkey’s Mersa Otomotiv and announced the sales of light commercial vehicles in Turkey, .

According to the Voice of Russia, the launching ceremony was held in the Turkish province of Sakarya Sunday.

The Venture expects to sell some 2,500 vehicles in 2013 and pledges attractive prices of $20,000 per vehicle.

Voice of Russia

via Russian carmaker to assemble in Turkey: Voice of Russia.

December 5, 2012
NEWS FROM TOYOTA – A SUCSESS STORY OF A YOUNG-TURK

‘Wii Go Places’ SMART Board Alternative Wows Innovation Fair Crowd

December 04, 2012 | Posted to: Associates, Technology

You never know when inspiration might strike.

Consider the example of Korhan Gurocak. By day, he serves as the Legal and Corporate Responsibility and Forensics manager in Information Systems (IS). By night, he is a screenwriter. While practicing the latter, he came up with a breakthrough idea that just might make a big impact on the former.

“While writing a script, I use a process where I put ideas on notes and tack them on a cork board, or I’ll simply write them on the wall,” he says. “I knew there had to be a better way, so I started researching SMART boards (made by SMART Technologies), hardware that basically digitizes the process. That’s when I learned that these devices are ridiculously expensive, costing up to $25,000.”

Along the way, Gurocak also discovered that some enterprising souls had come up with an alternative using a Wii video game system remote control working in concert with an infrared pen, a laptop and some simple software. At a total cost of just $100 (excluding the laptop), Gurocak had his high-tech scriptwriting solution.

He also had a ready-made answer when IS put out the call for entries for its annual Innovation Fair. Gurocak believed his fellow associates could benefit from his bargain-basement SMART board concept, so he assembled a team of colleagues to prove it.

Just a month later, they unveiled their idea at the fair, which for the first time in its six years was opened up to entries from all TMS departments, not just IS. “Wii Go Places,” as Gurocak’s team called it, was the runaway hit of the event. It claimed the first-place prize among the 36 projects that agreed to be judged by two cross-company panels of executives. Overall, a record 87 teams offered displays, including 39 representing non-IS business units.

Key Components – The SMART board on a budget includes: 1) an infrared pen; 2) a Wii remote; 3) laptop computer; 4) LCD projector; and 5) projection screen.

“It was an amazing experience,” says Gurocak, who was joined in the winning effort by: Terri Lee Batton, senior applications analyst; Jack Munter, applications engineer, business delivery; James Tu, Legal and eDiscovery technology manager; and Raul Yzaguirre, senior applications analyst. “Usually when you put something new out there, you have your naysayers. But everyone who came by our display was so positive, asking questions and wanting to know how it works. It was kind of surreal.”

So, how does it work? You start with a laptop or desktop computer. Then you connect that device to some sort of external display, such as an LCD projector or a TV. That’s the core set-up for many meetings at TMS, such as those built around a PowerPoint presentation.

What sets “Wii Go Places” apart is that instead of controlling the software with the laptop’s mouse, you use an infrared pen that communicates with a Wii remote that’s pointed at the display and connected to the computer (see diagram). Just point and click, on the big screen.

But it doesn’t stop there. With the right software, you can also “write” on the screen using the infrared pen–similar to writing on a dry-erase board with a dry-erase marker–and then save the work to the laptop, making it easy to share with everyone in the room as a text or image file.

The team also showed how a similar approach could be configured to allow everyone in the meeting, assuming they’re equipped with iPads or other devices of that ilk, to view and annotate the same material on their screens simultaneously while connected via Wi-Fi.

Wii Winners — Group Vice President and Chief Information Officer Zack Hicks congratulates the fair’s first-place team (left to right): Jack Munter, Business Delivery applications engineer; Raul Yzaguirre, senior applications engineer; Terri Lee Batton, senior applications analyst; Korhan Gurocak, LCR and Forensics manager; and James Tu, Legal and eDiscovery technology manager.

The bottom line: Collaboration just got a whole lot easier and cooler, not to mention cheaper. The cost for this set up is 250 times less than a full-blown SMART board with its proprietary software. And there’s essentially no compromise in capability.

“Everyone was able to see the business use,” says Gurocak. “We’ve all been in meetings where the dry-erase board won’t erase, or you end up taking a picture of the board with your camera phone and then have to transcribe the notes after the meeting. This could replace that.”

Gurocak says Zack Hicks, group vice president and chief information officer, has given the approval to set up a few conference rooms with the technology to see how it works. If the pilot program pans out, Gurocak’ s inspiration just might help make the company more efficient while also saving it a fair amount of money.

“As I understand it, the company was considering a big investment in SMART boards,” says Gurocak. “I guess it’s a good thing we did this when we did.”

By Dan Miller

December 5, 2012