Italy and Turkmenistan discussed business opportunities: might Rome support EU policy in Central Asia?
Geopolitical Report ISSN 2785-2598 Volume 28 Issue 2
Author: Giuliano Bifolchi
The recent meeting between the Turkmen ambassador to Italy and the Italian Trade Agency’s representatives highlighted business potentialities between the two countries, Rome’s desire to increase its presence in the Turkmen and Central Asia markets, and Ashgabat’s strategy to diversify its commercial partners.
- Turkmenistan needs to attract foreign investments to develop infrastructural projects, increase economic growth and diversify its economy.
- As a member of the European Union, Italy has paid decisive attention to Turkmenistan due to its regional role as a logistic hub and energy exporter.
- Italy – Turkmenistan business partnership might support EU strategy in the Turkmen territory aimed at increasing local socioeconomic standards and importing Turkmen natural gas to Europe to counter Brussels’ dependence on Russian energy exports.
- Italy might promote cultural and economic cooperation with Turkey to enhance its local presence in a country which recently signed several agreements with the Russian Federation.
On February 3rd, 2023, the Ambassador of Turkmenistan to Italy, Toyly Komekov, met with the General Director of the Italian Trade Agency, Roberto Luongo, to discuss the prospects for trade and economic cooperation between the two countries.
During the meeting, Toyly Komekov presented the possibilities and potential for economic cooperation between the countries, emphasising the great potential for the development of trade-economic relations, in particular between the private and public sectors.
Roberto Luongo expressed his hope for the organisation of a visit of the business circles of Turkmenistan to Italy this year to familiarise them with the achievements of the country’s companies in various fields of production. The General Director of the Italian Trade Agency stressed that there is great potential for strengthening cooperation between Turkmenistan and Italy in various directions.
The Luongo-Komekov meeting came after previous events and attempted to establish and increase cooperation between Italy and Turkmenistan, especially in the cultural and economic fields. Indeed, on April 21st, 2022, the Embassy of Turkmenistan in Rome supported the organisation of the first meeting of the Turkmen-Italian working group on cultural cooperation.
Why does it matter?
Since the fall of the Soviet Union and its independence, Turkmenistan has promoted a strategy based on permanent neutrality attempting to balance between Russia, the West, and the People’s Republic of China.
Due to its natural gas reserves, Turkmenistan might become an essential asset in the EU Energy Security Strategy, especially in the current days characterised by the confrontation between Brussels and Moscow caused by the Ukraine conflict. On the other hand, Ashgabat needs to diversify its commercial partners and expand its natural gas exports towards new markets, for instance, Europe.
Turkmenistan has the fourth-largest reserves of natural gas in the world: an estimated 19.5 trillion cubic meters, nearly 10% of the world’s total. Thanks to its natural gas reserves, Turkmenistan could challenge the world’s biggest gas exporters like Russia, Qatar and Norway.
Since the ’90s, the European Union has promoted the Trans-Caspian Pipeline projects to connect Turkmen’s natural gas with the European market through Azerbaijan, circumventing Russia and Iran. Although this project has considerable potential and might support both the EU energy strategy and Turkmen’s economic policy, it was just an idea for decades. When on January 21st, 2021, Azerbaijan President Ilham Aliyev and Turkmenistan President Gurbanguly Berdymukhamedov signed a memorandum of understanding on joint exploration of the hydrocarbon field now known as “Dostluk” or “Dostlug” (friendship) in their respective languages, the opportunities that Ashgabat could export its gas to Europe became more real.
Nowadays, the energy crisis caused by the Ukraine conflict and the Brussels-Moscow confrontation have transformed Turkmenistan into an attractive market where foreign investors might direct their attention to exploiting the country’s strategic position and natural resources.
In the energy field, it should also be mentioned that Turkmenistan has promoted the Turkmenistan-Afghanistan-Pakistan-India (TAPI) Pipeline Project, whose purpose is to export Turkmen gas to the Indian Sub-Continent. Indeed, since the Turkmen economy depends on energy export, Ashgabat should find a solution to secure and guarantee that the Afghan section of the TAPI pipeline will be built and defended from potential internal and external threats. In this framework, since the Taliban took power in August 2021, Turkmenistan has attempted to establish good relations with the Taliban interim Government encouraging cooperative projects.
As for the Caspian region itself, Italy is involved in several key energy projects in the Caspian. Italy today is the recipient of natural gas produced in the Azerbaijani sector at the bottom of the Caspian Sea. Hydrocarbons enter the country through the Trans-Adriatic Gas Pipeline (TAP), a segment of the Southern Gas Corridor. The Italian company ENI participates in developing hydrocarbon deposits in the Kazakh and Turkmen sectors of the bottom of the Caspian Sea.
In the last year, Italy has demonstrated its interest in expanding commercial and diplomatic ties with Central Asia. The Italian Government might use economic and cultural cooperation to strengthen its ties with Central Asian republics, especially Turkmenistan, which has extensive natural resources and requires foreign direct investments (FDIs). In this context, Italy might play a significant role in EU strategy in Central Asia, promoting Brussels’projects and diplomatic approaches with regional actors looking to diversify their foreign partners and decrease their dependence on Russia and China.
On the other hand, the recent Russia-Turkmenistan business forum attended by the Russian Prime Minister Mikhail Mishustin confirmed Kremlin’s strategy in Central Asia and Moscow’s desire to deepen economic and diplomatic cooperation with Ashgabat to avoid any further external interference by the European Union, China, or the United States.
The Kremlin still consider Central Asia a fundamental part of its blizhnee zarubezhe (near abroad) and lebensraum (vital space). Due to the massive pressure the West has put on Russia with economic sanctions caused by the Ukraine conflict, it is hard to believe that Moscow will ‘accept’ any foreign interference in the region.
Indeed, as underlined during the first “Central Asia – Russia” summit organised in October 2022 in Astana (Kazakhstan), Central Asia has a central role in Russia’s foreign policy and strategic vision. Therefore, in the future, Moscow will continue its policy of further strengthening economic cooperation with Central Asian republics by promoting the growth and diversification of mutual trade, expanding industrial cooperation in promising sectors of production, intensifying investment cooperation, and attempting to enlarge its military presence or defence cooperation with local governments.
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