China signs billion-dollar deal for car factory in Turkey

International report

China’s car giant BYD’s announcement to build a billion-dollar factory in Turkey represents a significant turnaround in bilateral relations. However, concerns persist regarding human rights issues and Turkey’s stance on the Chinese Muslim Uyghur community.

In a ceremony attended by Turkish President Recep Tayyip Erdogan, China's BYD car company signed an agreement to build a billion-dollar factory in Turkey.

The factory will produce 150,000 vehicles annually, mainly for the European Union market.

Analysts say the July deal marks a turning point in Turkish-Chinese relations.

"The significance of this deal is Turkey would be considered as a transition country between China and the EU," Sibel Karabel, director of the Asia Pacific department of Istanbul's Gedik University told RFI.

"This deal has the potential to reduce the trade imbalance, the trade deficit, which is a detriment to Turkey," he adds, "Turkey also wants to reap the benefits of China's cutting-edge technologies by collaborating with China."

Sidestepping tariffs

China's pivot towards Turkey, a NATO member, is also about Beijing's increasing competition for global influence, especially with the United States.

Karabel says the planned BYD factory offers a way for China to avoid the EU's new tariffs on vehicles.

Turkey is already a part of China's global investment strategy through its Belt and Road Initiative (BRI) and Beijing has shown interest in Turkey becoming a trade route from China to Europe through Ankara's Middle Corridor Intiative.

But until now, such collaborations have until been just empty words, claims Ceren Ergenc a China specialist at the Centre for European Policy Studies.

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"When you look at the press statements after meetings, you don't see Chinese investments in Turkey, and the reason for that is because China perceives Turkey as a high political risk country in the region," Ergenc explains.

One of the main factors widely cited for Beijing's reluctance to invest in Turkey is Ankara's strong support of China's Muslim Uyghur minority.

Ankara has been critical of Beijing's crackdown on Uyghurs, offering refuge to many Uyghur dissidents. Their Turkish supporters fear Beijing's billion-dollar investment in Turkey could be part of an extradition deal struck during Turkish Foreign Minister Hakan Fidan's recent visit to China.

"There are rumors, of course, that the Chinese side is pressing for the ratification of this extradition agreement, that they would want Uyghurs in Turkey, some of them at least, to be returned to China to be tried in China," warns Cagdas Ungor of Istanbul's Marmara University, referring to people China considers to be dissidents or "terrorists".

Common ground over Gaza

Elsewhere, Ankara and Beijing are finding increasing diplomatic common ground, including criticism of Israel's war on Hamas.

"If you take, for instance, the Gaza issue right now, Turkey and China, and even without trying," observes Ungor, "they see eye to eye on this issue. Their foreign policies align, overlap, and their policy becomes very much different from most of the other Western countries."

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For example, Ankara welcomed last month's decision by Beijing to host Palestinian leaders amid an escalation of threats and bombardment by Israel.

Such a move can provide common ground, Ungor suggests, and this could be the basis for future cooperation.

"There are certain issues at a global level, at the regional level, that China seems to be a much better partner(to Turkey) than the Western countries," he concludes.