Working relationship
Trade between the two is extremely strong. It reached some 3.5 billion U.S. dollars in 2008 but fell by 30 percent last year, in part explained by the world financial crisis but also to large extent by the reaction of Turkey to Israel's military operation in the Gaza Strip that ended in January of 2009.
With the unprecedented verbal attack by Erdogan on Israel, Israeli tourists stayed away from Turkey in droves. Turkey is a leading holiday destination for Israelis.
However, the relationship between the pair is not just about trade, much of which is in the realm of defense contacts, but the two also enjoy close military cooperation. In recent years they have participated in joint military exercises, although that level of unity vanished in the wake of Israel's Gaza operation.
Today, both the Israelis and Americans are watching Ankara closely. The feeling, particularly in Israel, is that Ankara is not only moving away from the Jewish state, but is also aligning itself with Syria and Iran. The Turkish government, for example, is talking about having an open border with Syria.
"We want to contribute to the cooperation between Turkey and Iran," Turkey's Parliament Speaker Mehmet Ali Sahin was quoted as saying by Iran's Press TV three weeks ago.
Western analysts believe much of this eastwards move is a direct consequence of the apparent rejection of Turkey's application to join the European Union.
Of late Erdogan and his governmental colleagues have been telling their Arab and Muslim neighbors how much importance they place on regional dialogue and cooperation.
Turkey's stance against Israel has also been largely welcomed around the Muslim world.
Palestinian factor
Ever since the rise to power in Ankara of the Islamic-leaning Justice and Development Party, Liel has argued that for Israel to restore good relations with Turkey it will first have to make a serious move towards peace with the Palestinians.
Liel, a former peace broker on the Palestinian track, believed that Ankara's cries of sympathy for the Palestinians are heartfelt as is the popular support of Turks for the Palestinian cause. The only ways in which Israel will really be able to win back Turkey will be by ending the Gaza blockade and cutting a deal with the Palestinian National Authority.
Israeli and Turkish analysts argue that the Turks do not really want to lose their ties with the Jewish state but they need Israel to act in a way that can allow Ankara to show that it has gained something for the Palestinians at the same time.
However, for the time being, Israel remains skeptical regarding Ankara's real intentions and numerous Israeli government officials have said they will not use Ankara as a negotiator on another peace track with Syria for as long as it is felt in Israel that Turkey cannot be an honest broker.
Turkey had been chairing indirect negotiations between Israel and Damascus with Netanyahu's predecessor Ehud Olmert.
Even in recent weeks, Turkey has offered to resurrect that track but for the time being Israel is saying "thanks, but no thanks."
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