Many countries aim to maintain or strengthen their network of trade relations and economic interests with other states or non-state actors, even those historically classified as “adversaries” or “enemies,” despite political tensions shaping their interactions. This applies to many cases, such as the United States’ relations with Iran and Cuba, Russia and Ukraine, India and China, France and Algeria, and Turkey and Greece. This approach reflects the presence of specific interests through which states—and even non-state armed actors—seek to sustain trade relations with “adversaries” through various channels.
Different Approaches
There are multiple ways to manage trade relations between politically conflicting parties, or between countries that have moved beyond tensions to establish good relations, based on international experiences and regional expertise:
1. Enacting laws governing trade with adversaries:
The United States exemplifies this approach for over a century, notably under former President Woodrow Wilson. On October 6, 1917, Congress passed the “Trading with the Enemy Act,” granting the President authority to review or entirely suspend trade relations with countries listed as “enemies,” with the option to exempt certain goods from import and export bans. This applied to countries such as Cuba, North Korea, Vietnam, and Iran, allowing specific trade deals like importing Cuban cigars or Iranian pistachios.
For example, the United States and Iran dominate global pistachio trade, controlling roughly 80% of annual global production. Despite domestic cultivation in California, Arizona, and New Mexico, American consumers have historically demanded Iranian pistachios due to their distinct taste. In 2016, following the Iranian nuclear deal (JCPOA) during former President Barack Obama’s administration, sanctions were lifted, and Iranian pistachio exports surged globally. However, during Donald Trump’s first term, sanctions were reinstated, banning Iranian pistachio imports, which were Iran’s third-largest source of foreign currency after oil and carpets, causing significant losses in the U.S. market.
2. Relying on the pivotal role of chamber of commerce leaders:
Current Egypt-Turkey relations illustrate the important role chamber leaders can play in rebuilding economic ties after political tensions. After years of strain following the fall of the Muslim Brotherhood in Egypt in 2013, both countries gradually overcame disputes. Today, their economic relations enjoy “unprecedented momentum,” according to Egyptian Foreign Minister Dr. Badr Abdel Aati on November 12, 2025, during his visit to the Turkish Union of Chambers and Commodity Exchanges (TOBB) in Ankara, where he met TOBB President Refat Hissarjiklioglu in the presence of prominent Turkish business leaders.
The Egyptian Foreign Minister highlighted the key role played by Hissarjiklioglu in supporting Egypt-Turkey economic and trade relations, emphasizing the business community’s role in achieving the goal set by Presidents Abdel Fattah El-Sisi and Recep Tayyip Erdoğan of raising bilateral trade to $15 billion over the next five years. Cairo also seeks strong Turkish business participation in the Egypt-Turkey Economic Forum scheduled for 2026.
Similarly, Michel Bizac, head of the Algerian-French Chamber of Commerce and Industry, aims to play a similar role in improving Paris-Algeria relations after political disputes affected trade relations.
3. Joint operations via intermediaries:
Analyses indicate that Syria under former President Bashar al-Assad managed relations with ISIS through an “oil-for-money” arrangement after the group seized eastern oil fields in 2013. The regime needed to supply oil to areas under its control, either through intermediaries or government officials. George Hassouani, a Russian-Syrian Christian owning a construction company (HESCO) in Moscow, reportedly acted as the intermediary between ISIS and Assad’s regime. In December 2015, Adam Szubin, then U.S. Treasury Undersecretary for Terrorism and Financial Intelligence, revealed that most ISIS oil went to Assad-controlled areas, with monthly sales around $40 million, totaling roughly half a billion dollars.
Thus, Assad’s regime and ISIS engaged in mutually beneficial arrangements, despite each claiming its goal was to eliminate the other from 2013 to 2024.
4. Parallel economies along borders:
“Shadow economies” often emerge along borderlines between countries where political disputes dominate relations, such as between Algeria and Morocco. In the absence of shared maritime routes and with closed land borders, interest groups on both sides sustain smuggling—primarily state-subsidized goods like food and fuel—threatening national economies, as acknowledged by former Algerian interior ministers. Trade thus continues through informal channels managed by individuals or groups outside official structures.
Explaining Factors
Several factors explain the growth of trade relations among so-called “adversaries” in international and regional interactions:
1. Creating conditions for peacebuilding:
This is evident in the Russia-Ukraine conflict, where economic interdependence—such as pipelines crossing Ukrainian territory to Europe—cannot be ignored. Ukraine gains leverage as a key player in regional energy, while Russia retains influence as a primary European gas supplier.
Some literature refers to “economic peace” as a strategy to enhance relations by converting conflict zones into cooperation areas, similar to post-WWII Western Europe. Implementing “joint economic zones” with tax incentives encourages mutual investment and creates jobs along borders. Local councils could coordinate on issues like smuggling, cross-border crime, and cultural or sports activities, easing mutual fear and restoring normalcy to affected towns and villages.
Where comprehensive peace agreements are unlikely soon, partial agreements—such as truck passage, visa facilitation, railway coordination, or prisoner exchanges—can demonstrate goodwill and achieve tangible benefits, gradually reducing tensions. For example, restoring electricity and water to a border area for both Russian and Ukrainian citizens would have significant impact and create small-scale success models for later expansion.
2. Sustaining economic benefits:
A key example is the growing trade between the U.S. and China despite political disputes over global leadership, unfair trade practices, intellectual property issues, technology competition, and supply chain restructuring.
Similarly, India-China relations, despite political and border tensions, show China as India’s major trade partner. This relationship blends strategic competition with pragmatic economic cooperation, including cross-border trade resumption and increased exchanges.
In the Middle East, Egypt-Turkey relations reflect the same pattern: both countries strengthened economic ties despite political disputes on regional issues, reflected in notable increases in trade and investment.
3. Using economic tools to ease political tensions:
Some political leaders recognize the use of economic resources as incentives to resolve—or at least neutralize—conflicts, reflected in financial transactions, official trade, and bilateral investment agreements. This approach is evident in Turkey’s foreign policy toward key Middle Eastern and European countries such as Egypt and Greece.
4. Supporting the survival of politically fragile regimes:
Certain regimes seek to prolong their rule by establishing mutually beneficial relations with non-state actors despite deep enmity. This is exemplified by Assad’s regime and ISIS in Syria, particularly in oil trade after the group controlled oil-rich Deir Ezzor fields like Al-Omar, Tanak, and Al-Azbah. Former U.S. envoy Brett McGurk emphasized targeting temporary refineries generating significant revenues to weaken both Assad and ISIS simultaneously.
Conclusion:
Trade relations are significantly affected by political disputes globally and in the Middle East. However, some countries have realized the loss of benefits if such approaches persist. Historical experience shows that sanctions or boycotts used as political pressure tools often fail, acting instead as “headwinds” against aid and economic support for allies. Strengthening trade relations among politically conflicting countries has therefore become indispensable in today’s world.
