Courcy's Intelligence Brief - 17 July 2013

Items

  • Kurds looking to take advantage of Erdogan's setbacks

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    The Turkish government of Prime Minister Recep Tayyip Erdogan is struggling with domestic unrest, economic uncertainty, and a foreign policy that has been shredded by the resilience of the Bashar al-Assad regime in Syria and the ousting of the Muslim Brotherhood administration in Egypt.  Now there is evidence that the peace process with the Kurdistan Workers’ Party (PKK) may be under strain, partly as a result of the government’s preoccupation with other matters and partly because PKK hardliners sense an opportunity.

    As we reported last week, there was a surge in violent incidents reportedly carried out by the PKK in the first week of July.  There were incidents in a wide range of cities, including Adana, Ankara, Diyarbakir, Hakkari, Istanbul, and Mersin.  The attacks included setting buildings on fire and attacking police cars and a gendarmerie outpost.  Many of the attacks were in rural areas of the Kurdish southeast and included abduction.  Turkish intelligence sources let it be known that they believed the PKK was trying to capitalize on the Gezi Park protests in Istanbul.  They also said that the group is continuing to recruit.

    The other problem has been a belief in Kurdish circles that the government has not been delivering on its side of the bargain.  On 30 June, the Kurdish-based Peace and Democracy Party (BDP), which is represented in parliament, presented a list of demands for the “second phase” of the peace process that began in October.  These include the release of PKK leader Abdullah Ocalan from jail.

    In the past week there have been further developments suggesting increasing difficulties.  Last Wednesday (10 July), for instance, it was announced that the Kurdish umbrella organization, the Kurdistan People’s Congress (KGK) had appointed a new joint leadership: Cemil Bayik and Bese Hozat.  The interesting aspect of this is that Bayik is known to be a hardliner close to Iran, and his appointment is seen as likely to move the Kurdistan Workers’ Party (PKK) closer to Iran, perhaps as a counter to the Turkish government’s close relations with the Kurdistan Regional Government (KRG) in northern Iraq.  Iran, of course, is also strongly opposed to Turkey’s anti-Assad policy in Syria.  In the past month there have been intelligence reports of Iran sending messages to the PKK not to implement its ceasefire with Turkey.

    Bese Hozat is a co-founder of the Kurdistan Communities Union (KCK), and significantly she is an Alevi.  The Alevis are seen to be the least pro-peace members of the PKK, particularly with Turkey supporting the Sunni opposition forces in Syria against Assad’s Alawite regime.  Although different from the Alawites, the Alevis are also a Shia sect.

    The BDP, despite its complaints about lack of progress on the government side, is still maintaining that the peace process is on target.  Its co-chairman Selahattin Demirtas claims that the negotiated pullout from Turkish territory by PKK guerrillas has “picked up speed” and that 50% of PKK guerrillas have withdrawn from Turkey, not the 15% recently claimed by Erdogan.  A BDP sources said this week: “No KCK official can say right now ‘the last person will be out by this or that date’.  They cannot even make a guess here.  There are geographical difficulties, organizational difficulties, security difficulties.  However, the organization’s leadership called on them to pick up the pace.”

    Demirtas has also denied that the Kurdish leadership reshuffle is negative, but not in an overly convincing manner.  He said: "Every period has a way of shaping the leadership.  Right now the KCK is experiencing a new period.  We are talking about a peace process.  Therefore, it is perfectly natural for them to carry out this reshuffle that takes into account this new process as a whole.  This is not counter to the spirit of the process.  It is an arrangement done to add strength and support to the process.  It is not opposed to the process but a reshuffle done for the sake of stronger participation in the process."

    Demirtas added: "All the names are part of the process and are lending their support.  It is not a case of this person being opposed and that person being in favour.  This is not a coup within the KCK.  It is a reshuffle in keeping with the spirit of the process."

    A less positive spin was provided by Murat Karayilan, who has stood down from the leadership of the KGK and instead become leader of the PKK’s armed wing, the People’s Defence Forces (HPG).  During the past week, he has described the peace process as being “in a tight spot”.  He added: “If the attitude of the Turkish state continues as it is now, the process will be blocked up.  It is not blocked now, but it is on the way to being blocked.”  He also talked about a continuing “big oppression of our people” following the clashes on 28 June in Lice district of Diyarbakir in which one person was killed and nine others seriously injured.

    That Erdogan’s government is in a difficult place, thus providing the PKK with an opportunity, cannot be in doubt.  The key points are:

    * Although Erdogan’s core support appears to be holding up, the Gezi protests have shown that a significant proportion of the population is opposed to his Islamist-tinged vision of modern Turkey.

    * Erdogan now has to add economic difficulties to his political problems.  The central bank, against Erdogan’s wishes, has signalled its intentions to raise interest rates in order to shore up the lire.  Foreign direct investment (FDI) was down 35% in the first five months of 2013, following on from a 23% fall in 2012.  And this exit by foreign investors comes at a time when Turkey’s external funding needs are increasing.  The current-account deficit is forecast to reach 7.5% of GDP by the year-end.  The central bank has revised down its 2013 growth estimate from 4% to 3.6%.

    * On the foreign front, Erdogan’s policy of alignment with the Muslim Brotherhood axis has been shattered by the ouster of Egypt’s MB president, Muhammad Mursi. 

    * Erdogan’s alignment with the Muslim Brotherhood has run in parallel with the alienation of Turkey from its earlier alliance with Israel and, to a lesser extent, from the European Union. 

    * Turkey’s relations with Russia and Iran are strained and are set to become more strained as Moscow and Tehran redouble their efforts to save Assad in the wake of Mursi’s ouster.

    Theoretically Erdogan’s support for the MB in Egypt, and his opposition to the ouster of Mursi, could be seen as taking a high moral position on the importance of supporting democracy in the Middle East, but because of his domestic and foreign-policy track record it is seen by the outside world as just a further indication of Erdogan’s pro-Islamist sympathies.  Even his stance against military intervention, rather than being seen as principled, is being dismissed as self-serving.

    And so, at a time of high domestic tension, Turkey under Erdogan finds itself at odds not only with Russia, Iran, Iraq, and Syria but also (in varying degrees) with the European Union, the United States, Saudi Arabia, the UAE, Jordan, Israel, and post-Mursi Egypt.  Even Hamas is now likely to tack back towards Iran, Assad, and Hezbollah.

    Sources close to the Justice and Development Party (AKP) leadership say the problem is Erdogan himself.  At home, while some see the need to be more conciliatory, there are no indications that the Erdogan is prepared to change the AKP’s domestic strategy.  The AKP will seek to win next year’s election by maintaining current policies as far as it can and by relying upon its core constituency. 

    And on the foreign front, while he could endear himself more to the Western powers by seeking to compensate for the collapse of his pro-Muslim Brotherhood policy by mending fences with the EU and Israel (which is what the United States would like to see happen), again there is little sign of any significant modification.

    So this  extraordinary catalogue of (mostly self-imposed) woes is likely to persist, with two main consequences for the Kurdish peace process.  The first is that Erdogan is using up much of the political capital that he will need to push through a comprehensive peace agreement.  The second, as we have seen this week, is that hardliners within the PKK are sensing an opportunity to harden their approach to the negotiations.  The Kurds could be about to make life even more difficult for Erdogan.  JdeC.

  • Iran to continue calling Netanyahu's bluff

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    In a ‘pointer’ in last week’s issue we reported that Israel was stepping up its attempts to keep Iran’s nuclear programme high on the international agenda, and the past week has indeed seen a significant increase in official Israeli rhetoric, and media coverage, of the Iranian threat. 

    The latest escalation in rhetoric follows on from the claim on 11 July by the National Council of Resistance of Iran (NCRI) that Iran was developing a secret nuclear site in tunnels near the town of Damavand for the production of plutonium.  Israel has also claimed in recent days that the new centrifuges Iran is installing mean it can now jump straight from 3.5% uranium enrichment to the 90% enrichment needed to make a nuclear bomb. 

    On 14 July, Israel’s Prime Minister Binyamin Netanyahu said that Iran was approaching the red line he had set out at the UN last September.  He also said: “There are many important issues that we have to deal with [in the Middle East], and I have a sense that there is no sense of urgency on Iran and yet Iran is the most urgent matter of all.”

    Netanyahu’s demands are that Iran “cease all enrichment…remove from the country all the enriched uranium, and…close the illegal [underground] nuclear facility at Qom”.

    The problem for Israel now is threefold.  First, as Netanyahu intimated, with so much uncertainty and unrest in the Middle East, for the United States a military strike against Iran’s nuclear facilities is more problematic than ever.  There would never be a good time, but Washington thinks now would be the very worst time. 

    Second, international support for an Israeli attack has been reduced further still by the feeling that Iran’s supposedly moderate president-elect, Hassan Rowhani, needs to be given time to develop a new policy.  Netanyahu’s response to this, in an interview broadcast by CBS on 14 July, is to argue: “His strategy is to be a wolf in sheep’s clothing.  Smile and build a bomb.”

    Thirdly, this will be the fourth summer in a row that Netanyahu has ratcheted up the rhetoric about the possibility of an attack, without taking action.  Iran has long stated publicly that it doesn’t believe in Israel’s threats, and this belief can only have been reinforced by the gap in recent years between Israeli rhetoric and Israeli action.  When Netanyahu says once again, as he did on 14 July, that “it is important to…present Iran with a credible military option”, there is no indication that Iran is inclined to take this seriously.  At the very least it is likely that Iran believes it will remain in the clear until the spring of 2014. 

    But if it is true, as we believe it is, that Iran believes Netanyahu is bluffing; and if it is also true, as we believe it is, that Netanyahu will eventually act if no one else does, then that is the worst of all possible worlds.

  • Brazil isn't Egypt

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    A well-placed Courcy’s Intelligence source in Sao Paolo writes that while comparing Brazil with Egypt and Turkey is inevitable it is misplaced.  Brazilians have not taken to the streets to overthrow the government.  The key points are:

    * President Dilma Rousseff is struggling to stay one step ahead of the public mood.  Her approval rating has fallen from 65% in March to around 30%.  What looked like being a comfortable first-round victory in the 2014 presidential election could now go to a close fight in the second round.  Although the protesters did not set out to topple the government, they may have created the conditions for an end to the PT’s spell of power.

    * Rousseff presented five proposals for political reform to Congress on 2 July.  A commission is to take 90 days to consider these and to decide upon questions to be put to a plebiscite.  The supreme electoral court (TSE) says that it needs 70 days to organize and hold a plebiscite.  They would then have to be enacted, so it might be difficult to get the reforms in place for the 2014 election.

    * Congress is unlikely to be bounced into a quick fix to suit Rousseff’s electoral timetable.  However, an intransigent (and unpopular) congress blocking popular executive initiatives could conceivably boost Rousseff ahead of the elections.

    * The good news for Rousseff is that as yet few of her rivals have profited to any great extent from her fall in popularity.  Voting intentions for the former environment minister Marina Silva are up to 23% from 16%, but she has yet to gather the 500,000 votes necessary to register her new party.  Support for the main opposition candidate, Aecio Neves of the PSDB, has risen only three percentage points to 17%.

    * One intriguing thought is that the unrest could benefit former president Lula da Silva who remains popular despite his proximity to a corruption scandal.

    * The 2013 budget was formulated on the expectation of 4.5% growth for the year.  The central bank is now forecasting 2.7%.

    *  All this suggests that the ratings agency Standard & Poor’s is right to be concerned about popular pressure on fiscal policy ahead of the 2014 elections.  S&P has said there could be a further downgrade “if there is a greater sense of intervention in the public sector, which will increase debt levels”.

  • Risk pointers

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    *** North Korean economy grows.  On 12 July, South Korea’s central bank estimated that the North Korean economy grew by 1.3% in 2012, the fastest rate since 2008 when the economy was estimated to have grown by 3.1%.  In 2010 and 2011 the North’s economy is thought to have contracted by 0.9% and 0.5% respectively. 

    The Hyundai Research Institute (HRI), a privately funded South Korean think tank, is even more positive about North Korea’s per capita income, saying it grew by 8.75% in 2012 to $783.  However, this is a tiny 3.4% of South Korea’s per capita income of $23,113.  The North Korean increase is attributed mostly to improved grain production as a result of more favourable weather.  Two other socialist economies in Asia, Vietnam and Laos, have per capita income of $1,528 and $1,446 respectively.

    *** Abe’s holiday message to China.  In a message released on 12 July ahead of Japan’s Marine Day holiday on 15 July, Prime Minister Shinzo Abe reinforced Japan’s determination to protect its sovereignty over the Senkaku Islands, which are claimed by China as the Diaoyu Islands. 

    Abe said: “Peace and prosperity in Japan as a maritime nation are based on free, open, and peaceful oceans.  I will protect [Japanese] interests in stable marine traffic routes, territorial waters, and exclusive economic zones.”  He added: “I have decided to preserve…maritime order governed by law, rejecting any attempt to alter the status quo by force.” 

    The nature of Abe’s words marking the holiday was said by Japanese officials to be “unusual”. 

    *** Iranian fighters for Syria.  Kuwaiti sources say that Hezbollah has asked Iran to send 2,000 more Iranian fighters to Syria.  Although it is not certain whether this is in addition to the 4,000 Iranian Revolutionary Guards who were said to have been committed to the Syrian fight by Tehran in June, it is the fact of the request that is interesting. 

    The request has apparently come from Hezbollah because it is being stretched too thinly to protect its own areas of Lebanon, as seen in last week’s bomb attack on its southern Beirut stronghold and again in the roadside bomb that targeted a Hezbollah convoy near the Syrian border on 16 July.  Hezbollah is said to be finding it difficult to protect its key interests in Beirut, the Beqaa Valley, and the south of Lebanon at the same time as engaging in the fight to shore up the Assad regime in Syria.

    *** Turkey targeting photographers.  The Turkish Association of Photographers says that 111 photographers were detained, targeted by violence, or had their photographs erased by police during the demonstrations in Ankara and Istanbul between 31 May and 8 July.