The Zarrab case: Time to re-strategize Turkey’s interests

The long-awaited trial of Turkish-Iranian gold trader Reza Zarrab over evading U.S. sanctions against Iran, which is set to start next week after the jury selection, looks like a ticking time bomb at the heart of Turkey-U.S. relations. After it became clear that the lack of sufficient information on Zarrab’s whereabouts and his disappearance from the defense scene since the beginning of September were major pieces of the puzzle, it seems that Ankara pushed the button for a renewed defamation campaign against the U.S. and its justice system.

Indications that Zarrab “flipped” from being a defendant into a government witness in the case were recently embraced by Prime Minister Binali Yıldırım. “Parties of the trial are being held under pressure to testify against our country. This is a violation of human rights,” he said.

First of all, we should re-consider why a wealthy 34-year-old man who had been fearful of his own life as well as his loved ones’ would jump on a plane to take his child to Disneyland in the U.S., where his business dealings are considered a conspiracy to deceive its financial system. This is a question long deferred in Turkish government circles, along with the possible political and economic consequences of this case for Turkey itself. Not to mention the failure of Ankara to grasp how the U.S. legal system functions, since Ankara presumed it would be able to convince President Donald Trump to drop the Zarrab case.

Trump is not the king of the hill when it comes to conducting business with independent branches of the U.S. government. His firing of FBI director James Comey as well as former U.S. attorney for the Southern District of New York Preet Bharara, who indicted Zarrab, might have encouraged Ankara in hoping for interference by Trump himself.

Furthermore, Rudy Giuliani, a long-time friend of Trump, misdirected the Turks by tabling a proposal to “swap” Zarrab with American pastor Andrew Brunson, who has been in jail in the western province of İzmir for almost a year. Trump taking a bold step to rescue an Iranian from the U.S. justice system was inconceivable in the first place, considering his known stance against Iran.

But what has happened has happened. Now it is time for Turkey to re-strategize its national interests, first and foremost to help the Turkish economy survive the turbulence. There are rumors that one option Ankara has been considering is to not pay a possible fine brought against Halkbank by the U.S. Treasury following the verdict in Manhattan. If true, this is alarming. It would both undermine the entire Turkish banking system and play into the hands of those who have been looking for reasons to start a real debate on economic sanctions against Turkey in the U.S. Congress.

Although the trial in New York is about Turkey’s December 2013 corruption allegations, it may get very ugly when the wiretapped phone conversations of Zarrab and Halkbank Deputy General Manager Hakan Atilla are played in the courtroom. Those wiretaps might eventually not be considered legal evidence by the court. However, the presence of the international press in the courtroom during the disclosure of the evasion scheme (including possible senior government connections) would probably have a nuclear effect in U.S. public opinion.

Framing the Zarrab case as a part of a grand conspiracy to topple the Turkish government may consolidate President Recep Tayyip Erdoğan’s base. But this discourse is little more than a bore in Western capitals. How Ankara will react in the next weeks to the accusations/confessions in the court case in New York will inevitably be read as a sign of which side Turkey will pick in the international power struggle.

As much as the government in Ankara today is convinced that the U.S. has been trying to weaken and destabilize Turkey, history shows that U.S. interests require a stable and democratic Turkey. Unfortunately, the lack of vision and robust policies in both governments make it harder to contain the damage from a crisis of this magnitude.