Amid row with US, Turkey’s search for ‘new allies’ has few viable options

Ankara said Washington had unleashed an “economic war” against Turkey.
Sunday 19/08/2018
Turkish businessmen stand in front of a currency exchange office in response to the call of Turkish President Recep Tayyip Erdogan on Turks to sell their dollar and euro savings to support the lira, on August 14. (Reuters)
Desperate moves. Turkish businessmen stand in front of a currency exchange office in response to the call of Turkish President Recep Tayyip Erdogan on Turks to sell their dollar and euro savings to support the lira, on August 14. (Reuters)

ISTANBUL - Caught in the most serious row with the United States in decades, Turkey reached out to allies on the Gulf and in Europe to shore up its economy, raking in a $15 billion investment from Qatar that observers said is a big thank you note for Ankara’s support in Doha’s dispute with Saudi Arabia and the United Arab Emirates.

Turkish President Recep Tayyip Erdogan is accusing US President Donald Trump of stabbing NATO-ally Turkey “in the back” with punitive sanctions on its steel and aluminium imports that turned an erosion of the value of the Turkish lira into a dramatic collapse. Trump imposed the measures to protest the detention of American pastor Andrew Brunson in Turkey.

In escalating rhetoric used by Erdogan and his government since Trump’s decision, Ankara said Washington unleashed an “economic war” against Turkey. When Erdogan called on Turks to boycott US electronic items, such as iPhones, and switch to competitors like Samsung or Turkish company Vestel, supporters of the Turkish leader posted

videos of themselves smashing US mobile phones. In an answer to Trump’s steel tariffs, Turkey doubled import tariffs on US passenger cars to 120%, on alcoholic drinks from the United States to 140% and on leaf tobacco to 60%.

Writing in the New York Times, Erdogan warned that the United States should refrain from “unilateralism and disrespect” or see Turkey “looking for new friends and allies.” Washington should “come to terms with the fact that Turkey has alternatives,” the Turkish president wrote. On the day Trump unveiled his sanctions against Turkey, Erdogan had a telephone conversation with Russian President Vladimir Putin, who sent his foreign minister, Sergei Lavrov, to Ankara.

Qatari Emir Sheikh Tamim bin Hamad al-Thani, a regional ally of Turkey, visited Ankara on August 15 for more than three hours of talks with Erdogan. Erdogan’s son-in law and finance minister Berat Albayrak and Qatari Finance Minister Ali Sharif al Emadi also took part in the meeting that produced a promise by Qatar to invest $15 billion in Turkey’s financial sector.

Soner Cagaptay, director of the Turkish programme at the Washington Institute, said the promise by Qatar “could build investor confidence in Turkey, staving off potential economic collapse.” Writing on Twitter, Cagaptay said the $15 billion was Doha’s way of thanking Turkey for its support during the standoff with a Saudi-led quartet of Arab countries that imposed an embargo on Qatar last year. “The Qataris believe Turkish troop deployment saved them from Saudi-UAE invasion” during the Qatar crisis last year, he said.

Both Qatar and Turkey have been accused of supporting the Muslim Brotherhood and both governments remain on good terms with Iran despite efforts by the United States, Saudi Arabia and the United Arab Emirates to curb Tehran’s influence. “Qatar has proven its friendship,” stated a headline of the pro-government Turkiye newspaper.

Before the Qatar meeting, Albayrak travelled to Kuwait for talks with Kuwaiti Finance Minister Nayef al-Hajraf. The Kuwaiti government dismissed reports that Albayrak asked for money and that Kuwait helped to shore up the Turkish lira with $1.6 billion.

Erdogan also promised closer ties with China and said Turkey was preparing to conduct its trade with Russia and China in national currencies rather than in US dollars. A similar agreement was reached with Iran last year. Albayrak said the dollar had “lost credibility.” During his visit to Ankara, Lavrov declared that the “grave abuse of the role of the US dollar as a global reserve currency will result over time in the weakening and demise of its role.”

For all the tough talk in Ankara, Turkish Foreign Minister Mevlut Cavusoglu insisted that the basic parameters of Turkey’s foreign policy had not changed despite the spat with Washington. “Both the NATO alliance and EU membership will continue to be our key directions,” he said in a speech at the yearly conference of Turkish ambassadors in Ankara.

Turkey does not have credible alternatives to its allies in the West and in the Gulf anyway. Europe buys 44.5% of Turkey’s exports, while Russia and China are not even in the top ten of countries that take Turkish goods. Half of the foreign direct investment flowing into Turkey is from Europe. Ilter Turan, a political scientist at Istanbul’s Bilgi University, said talk of a new alliance between Turkey and Russia ignored the fact that Russia’s gross domestic product was “about as big as that of Italy.”

While cooperating closely in the Syrian conflict, Turkey and Russia are heirs of empires that fought wars against each other over centuries, were members of rival camps in the Cold War and have deep differences in the Caucasus and elsewhere. Ankara’s relations with China are not without problems, either. In 2009, Erdogan denounced China’s treatment of the Uighur Muslim minority as “genocide.”

By contrast, “Europe is extremely important” for Turkey in economic terms, Turan said. “A partnership with Russia and Iran is not a very persuasive option.”

However, because the Europeans are not powerful enough on the field of security, Turkey should not burn all bridges with the United States, Turan said. In a period without a clearly defined new world order after the end of the post-second world war era, Ankara should hedge its bets, he added: “Don’t leave the United States but develop relations with China.”

Both the European Union and Turkey signalled a willingness to overcome tensions that have marred relations in recent years. Erdogan is to travel to Germany in September for his first state visit to the most powerful EU country since he became president in 2014. Erdogan and German Chancellor Angela Merkel, speaking by telephone August 15, agreed that the two countries’ finance and economic ministers should meet before the presidential visit.

In another sign that Ankara is eager to improve relations with Europe, Turkish courts freed two Greek soldiers, who had been held for months for an alleged border violation, and Taner Kilic, the Turkish chairman of Amnesty International, who was arrested last year on terror charges.