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Alarm Mounts in Western Capitals Over Turkey’s Deepening Ties With Russia

Western capitals are increasingly alarmed about the deepening economic co-operation between Turkey’s president Recep Tayyip Erdoğan and Vladimir Putin, warning of the mounting risk that the Nato member state could be hit by punitive retaliation if it helps Russia avoid sanctions.

Six western officials told the Financial Times that they were concerned about the pledge made on Friday by the Turkish and Russian leaders to expand their co-operation on trade and energy after a four-hour meeting in Sochi.

One EU official said that the 27-member bloc was monitoring Turkish-Russian co-operation “more and more closely”, voicing concern that Turkey was “increasingly” becoming a platform for trade with Russia.

Another described Turkey’s behaviour towards Russia as “very opportunistic”, adding: “We are trying to make the Turks pay attention to our concerns.”

Washington has warned repeatedly that it will hit countries that help Russia to evade sanctions with “secondary sanctions” that target violations beyond the US legal jurisdiction, however the EU has been more reticent about doing this.

US deputy Treasury secretary Wally Adeyemo met Turkish officials and Istanbul bankers in June to warn them not to become a conduit for illicit Russian money.

One senior western official suggested that countries could call on their companies and banks to pull out of Turkey if Erdoğan follows through on the commitments he set out on Friday — a highly unusual threat against a fellow Nato member state that could cripple the country’s $800bn economy if foreign firms agreed to comply.

The official said nations that have imposed sanctions on Russia could act against Ankara by “calling on Western firms to either pull out of relationships in Turkey, or to shrink their relationships with Turkey, in light of the risk that would be created by Turkey expanding their relationship with Russia”.

However that suggestion was dismissed by several other western officials, who questioned how it would work in practical and legal terms and whether it would be a good idea.

Turkey is deeply integrated into the western financial system and brands from Coca-Cola and Ford to Bosch and BP have longstanding and often highly profitable operations in the country.

“There are very significant economic interests that would probably fight hard against such negative actions,” said one European official. 

But the official added that he would “not rule out any negative actions [if] Turkey gets too close to Russia”.

While he conceded that a formal EU decision on sanctions against Turkey would be challenging given divisions within the bloc, he suggested that some individual member states could take action. “For example they could ask for restrictions on trade finance or ask the large financial companies to reduce finance to Turkish companies,” he said.

Three European officials said that there had not yet been any official discussions in Brussels about possible repercussions for Turkey. Several others cautioned that the full details and repercussions of the discussions in Sochi were not yet clear.

The warnings come a day after Putin and Erdoğan — who has pursued what he calls a “balanced” approach to Kyiv and Moscow since the full-scale Russian invasion of Ukraine in February — held a long tête-à-tête that culminated in a joint pledge to increase bilateral trade volumes and deepen economic and energy ties.

Deputy prime minister Alexander Novak, Moscow’s top energy official, told reporters that Turkey had agreed to begin paying for Russia’s gas in roubles, according to Interfax. Putin and Erdoğan discussed further developing banking ties and settlements in roubles and lira, he added. 

Speaking on his plane back from Russia, Erdoğan told journalists that there were also “very serious developments” on the use of Russia’s MIR payment card system, which allows Russians in Turkey to pay by card at a time when Visa and Mastercard have suspended operations in their home country.

Erdoğan said that MIR cards would help Russian tourists to pay for shopping and hotels. Western officials fear that they could also be used to help bypass sanctions.

Diplomatic relations between Turkey and the west are already strained. Washington hit Ankara with sanctions in 2020 in retaliation for the purchase of an S-400 air defence system from Moscow, although the measures targeted the country’s defence industry rather than the broader economy. 

Erdoğan, who has repeatedly threatened to veto Sweden’s and Finland’s admission into Nato, is viewed in many western capitals as an increasingly unreliable ally. Yet Turkey is a vital partner for Europe on counter terrorism and refugees. The country hosts around 3.7mn Syrians as part of a deal struck with the EU in 2016 that helped to stem the flow of migrants to Europe. 

The conflict between Russia and Ukraine has underlined Turkey’s strategically important location, controlling access to the straits that link the Black Sea to the Mediterranean.

Erdoğan also played a key role in securing the grain deal signed by Russia and Ukraine last month that aimed to avert a global food crisis.

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Original Post: ft.com

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