Chinese Foreign Minister Wang Yi and his Turkish counterpart, Mevlut Cavusoglu, attend the Central-South Asia trade summit in Tashkent earlier in the week. Reuters
Chinese Foreign Minister Wang Yi and his Turkish counterpart, Mevlut Cavusoglu, attend the Central-South Asia trade summit in Tashkent earlier in the week. Reuters
Chinese Foreign Minister Wang Yi and his Turkish counterpart, Mevlut Cavusoglu, attend the Central-South Asia trade summit in Tashkent earlier in the week. Reuters
Chinese Foreign Minister Wang Yi and his Turkish counterpart, Mevlut Cavusoglu, attend the Central-South Asia trade summit in Tashkent earlier in the week. Reuters


Turkey's high-risk gamble in Afghanistan


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July 18, 2021

It’s easy to view the American-led war in Afghanistan as a disaster. Twenty years after US and Nato forces arrived to end years of harsh Taliban rule while vanquishing Al Qaeda and its leader Osama bin Laden, the Taliban is retaking great swathes of territory as US forces depart and the country tumbles toward chaos.

Observers foresee another civil war or Taliban takeover, while the militant group has banned smoking and prohibited men from shaving in some areas it controls, and the US’s post-9/11 president, George W Bush, has emerged to denounce Taliban brutality, making the past two decades seem almost like a mirage.

But now here comes Turkey, arriving to hold the line and potentially save the republic by taking over security at Kabul’s Hamid Karzai International Airport, as first reported last month by The National. The deal is not yet final, but US and Nato officials have confirmed their interest in Turkish forces taking control of a crucial symbol and a logistics, economic and military hub. US-Turkey talks last week are said to have made real progress.

The thinking is that as fellow Muslims – particularly Muslims deployed by a state run by the fellow Islamist Justice and Development Party – Turkish troops would be much less likely to come under assault from the Taliban. Indeed, Turkey had been positioned to serve as mediator for peace talks between the Taliban and the Afghan government, until President Joe Biden announced the US withdrawal and the talks fell through.

But Afghan extremists have for decades shown few qualms about attacking their Muslim brethren, and last week the Taliban vowed to “take a stand against” Turkish forces if they remain in Afghanistan, urging Ankara to reverse its decision on Kabul airport. A Turkish security official dismissed these as “symbolic statements” from the Taliban and President Recep Tayyip Erdogan vowed to be a good Nato soldier.

Turkey has no combat troops in Afghanistan, but has supported US and Nato operations there since 2002. Turkish forces have assisted in the training of Afghan military officers, instructors and commando units, and a Turkish contingent currently leads the multinational force that trains, advises and assists Afghan military divisions in Kabul.

In addition, Ankara has developed close defence ties with neighbouring Pakistan, including a handful of joint military programmes, and last October signed a defence deal with another Afghan neighbour, Uzbekistan, that includes industrial co-operation and joint training.

In taking over Kabul airport security, the Erdogan government may not be going as far out of its comfort zone as some might think. Let’s not forget, the Turkish military has proven itself time and again on regional battlefields in the past few years.

In early 2020, Ankara helped to hold off a massive Russian-backed Syrian assault on Idlib province. Then Turkish forces played a key role in halting the Libyan National Army’s advance on Tripoli. And finally Turkey’s advanced drones and military advisers were said to have been crucial in last year’s Azeri victory in Nagorno-Karabakh.

Turkish President Recep Tayyip Erdogan is seeking a trade-off with the US. AFP
Turkish President Recep Tayyip Erdogan is seeking a trade-off with the US. AFP

These successes, along with its robust defence industry, relatively reliable proxies and greater risk tolerance, have “enabled Turkey to exercise along and near its periphery what amounts to a geopolitical veto", retired US military officer and State Department adviser Rich Outzen wrote this month for the Washington Institute think tank.

Might that veto extend all the way to Afghanistan and the edge of South Asia? We may soon find out. The Taliban would represent Turkey’s greatest foe thus far. The extremist group still seeks to establish an Islamic state, but it has taken on more of a pan-Afghan appearance and de-emphasised ties with Al Qaeda and ISIS. Since being ousted in 2001, the Taliban has reportedly gained some support among the country’s Hazara, Tajik and Uzbek minorities.

The Taliban now claims to control 85 per cent of Afghan territory, though the Afghan government and most analysts dispute this figure. The group has yet to take a provincial capital, but it has captured several key border crossings in recent weeks, from Islam Qala in Herat province to Spin Boldak in south-eastern Kandahar.

Last month, US intelligence estimated that the Afghan government could collapse in the face of the Taliban assault as quickly as six months after the US pullout. That would mean troops representing an Islamist-run Turkish state could face a showdown with the militant Islamist Taliban as early as February.

Several thousand Turkish troops may be required to secure Kabul airport. Already, some 600 Turkish troops are stationed in Afghanistan and in January, the Turkish army took the lead on a key Nato readiness task force, placing thousands of soldiers on standby, ready to deploy at a moment’s notice. Turkey maintains military bases in Azerbaijan and Qatar, which could provide rapid support, and Ankara could further strengthen its military presence by importing some of the thousands of Syrian mercenaries it reportedly deployed in Libya and Nagorno-Karabakh.

Still, the 60,000-strong Taliban has of late been shredding the 300,000-troop, Nato-trained Afghan army. Retired Turkish ambassador Faruk Logoglu last week warned of “dire consequences” for Turkish forces facing a Taliban assault in Afghanistan. Yet Mr Erdogan may feel he has little choice.

Erdogan’s Kabul airport commitment is likely less about Afghanistan than it is about finding a way to end US sanctions

Since Ankara’s 2019 purchase of Russian S-400 missile defences against the wishes of the US and Nato, the Turkish state has been seen as deeply problematic by fellow coalition members. Thus Mr Erdogan’s Kabul airport commitment is likely less about Afghanistan and the Taliban than it is about finding a way to end US sanctions on the S-400s and return to the good graces of its western partners.

This is not unreasonable, as Washington wants to get out of the nation-building business in the Middle East and Eurasia. Meanwhile, the Biden administration is in talks with several Central Asian republics about stationing a significant US contingent at one or more of their military bases, to be able to respond to a possible crisis in Afghanistan. And the US needs to keep Kabul airport secure to enable limited diplomatic, military and intelligence operations.

Mr Erdogan has said the Turkish mission expects military, financial and logistical support from the US, as well as the end of the S-400 dispute. Along with intelligence operatives, some 1,000 US troops might remain in Afghanistan after its withdrawal is complete in September: 650 to protect diplomats and a few hundred more to oversee the Kabul airport transition.

Might Turkish forces draw any regional backing? Russia may not side with Ankara in a Turkey-Taliban tussle, but China (seeking stability for Belt and Road Initiative), India (as always, aiming to counter Pakistan) and Iran (no more refugees) could back Turkey.

Yet, at least until a Taliban takeover of Afghanistan is imminent, Ankara should expect minimal military support from western and regional powers. This is pretty much an ideal scenario for Mr Erdogan, who often speaks of reviving the Ottoman era and building an empire capable of shaping the region. He may soon face his greatest test in Afghanistan, the Graveyard of Empires.

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Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

The specs

Price, base / as tested Dh12 million

Engine 8.0-litre quad-turbo, W16

Gearbox seven-speed dual clutch auto

Power 1479 @ 6,700rpm

Torque 1600Nm @ 2,000rpm 0-100kph: 2.6 seconds 0-200kph: 6.1 seconds

Top speed 420 kph (governed)

Fuel economy, combined 35.2L / 100km (est)

Updated: July 18, 2021, 2:00 PM