Oct. 12 (Bloomberg) -- Armenian President Serzh Sargsyan may not mind if Turkey’s soccer team thrashes Armenia this week. He has his sights set on a higher goal -- ending a century-old dispute between the two neighbors.

Sargsyan is due to attend the Oct. 14 World Cup qualifier in Bursa, northwest Turkey, the first visit by an Armenian leader in a decade, as a guest of his Turkish counterpart Abdullah Gul. A year ago, Gul broke new ground by watching the last match between the sides in Armenia in a move dubbed as “soccer diplomacy” by the press.

The visit comes four days after the two countries agreed a road-map for establishing diplomatic ties, which Turkey hopes will assuage European Union opponents of Turkish membership. Armenia hopes it will raise living standards. Politicians from both sides face opposition though, as Armenians demand that Turkey recognize the massacre of their compatriots in 1915 as genocide.

“These are age-old problems that go back to the creation of the Turkish nation,” said Cengiz Aktar, an international relations expert at Bahcesehir University in Istanbul. “There are no quick fixes, but historically it’s a landmark.”

U.S. Secretary of State Hillary Clinton helped mediate a last-minute hitch at the road-map signing ceremony in Zurich on Oct. 10. The accord now needs to be ratified by both parliaments. It foresees the border opening between the two countries within two months of the accord taking effect. Turkey closed it in 1993 to protest against Armenia’s occupation of territory in Azerbaijan, a key Turkish ally and energy supplier.

Next Step ‘Difficult’

Turkey’s parliament will debate the agreement on Oct. 21, Deputy Prime Minister Cemil Cicek said today.

Ratification is “going to be difficult but that’s the next step,” Clinton told reporters after the signing. Turkish Prime Minister Recep Tayyip Erdogan said it will be “easier” for the Turkish assembly to approve the agreement if Armenia takes steps to resolve its territorial dispute with Azerbaijan, Aksam newspaper reported today.

Turkey and Armenia pledged to set up a joint commission of historians to investigate the World War I massacres, recognized by France and several other countries as genocide. Armenia says as many as 1.5 million were systematically killed. Turkey cites a lower figure and says the deaths were the result of civil strife in which many Turks were also killed.

World Tour

Sargsyan has spent most of this month touring the world to convince diaspora Armenians that a deal with Turkey is in Armenia’s interests. He was greeted by protests in Los Angeles, Beirut and Paris as ethnic Armenians opposed the plan.

For Armenia, where the average income is about $1,500, the restoration of ties would open the door to trade with Turkey, a country of 72 million with an economy of $600 billion.

“Gaining an open border to a significant market will help,” said Michael Kambeck, secretary general of the Brussels- based European Friends of Armenia, which promotes ties with the EU. “And both countries can start dealing with their past in a better way than they can do now.”

Turkey can point to the Armenian accord to bolster its EU application and also improve ties with the U.S., said Wolfango Piccoli, a London-based analyst at the Eurasia Group, which measures political risk in emerging markets.

Successive U.S. presidents including Barack Obama have pledged to recognize the Armenian genocide, straining relations with NATO member Turkey, though they haven’t fulfilled the promises.

Possible Delay

The opening of the border may be delayed as Turkey seeks progress in talks over Armenia’s occupation of Nagorno-Karabakh, an enclave within Azerbaijan, said Piccoli.

Obama has backed the current negotiations and told the Turkish parliament during a visit in April that “an open border would return the Turkish and Armenian people to a peaceful and prosperous coexistence.”

Azerbaijan supplies Turkey with gas and sells its oil to Europe via a pipeline through Turkey.

Europe and the U.S. want former Soviet states in central Asia such as Azerbaijan to sell oil and gas to the West independently of Russia. That means transporting it to Turkey through the Caucasus, which has been riven by disputes such as the one between Turkey and Armenia.

London-based BP Plc opened a $3 billion oil pipeline from Azerbaijan to Turkey’s Mediterranean coast in 2005. The $11- billion Nabucco project to carry natural gas via Turkey to Europe depends partly on Azeri supplies of the fuel.

Neither Turkey nor Armenia can qualify for the World Cup after Turkey lost 2-0 to Belgium on Oct. 10. Armenia lost 2-1 to Spain on the same day and is bottom of the group.

Flag Burned

The sport has served a diplomatic purpose in the past. Iranian and U.S. players exchanged flowers before a 1998 World Cup match, symbolizing a political thaw under then-President Mohammad Khatami. Co-hosting the 2002 tournament helped ease historic tensions between Japan and South Korea.

In 1969, though, Honduras and El Salvador went to war days after a World Cup qualifier in which Salvadoran authorities burned the Honduran flag during pre-match ceremonies and ran a used dishcloth up the flagpole instead.

The following is a list of events in Turkey this week:

*T Event Survey Prior Date Aug. Current Account $0.3 bln Oct. 12 July Unemployment rate 13% Oct. 15 Base rate 7.25% Oct. 15 Consumer confidence 81.3 Oct. 16

To contact the reporter on this story: Ben Holland in Istanbul at bholland1@bloomberg.net.

Last Updated: October 12, 2009 10:56 EDT