Tensions Rise As Trump Doubles Tariffs On Turkey
Earlier this week, the Turkish lira plunged to a record low following a decision by President Trump to double tariffs on steel and aluminum on the country.
I have just authorized a doubling of Tariffs on Steel and Aluminum with respect to Turkey as their currency, the Turkish Lira, slides rapidly downward against our very strong Dollar! Aluminum will now be 20% and Steel 50%. Our relations with Turkey are not good at this time!
— Donald J. Trump (@realDonaldTrump) August 10, 2018
Turkey’s currency has since recovered slightly, after assurances from the central bank and a loan from Qatar. However, other emerging market economies have been affected amid investor fears of an international crisis; the Indian rupee plunged to its lowest level this week. Global stock market drops prompted concern that Turkey’s crisis could negatively impact other economies, particularly slow growing ones in Europe and South America.
The tariffs by Trump were prompted by Turkey’s refusal to release Pastor Andrew Brunson, who is being held on terrorism charges for his alleged ties to the Kurdistan Workers Party, a terrorist group, as well as the Gulenist movement, suspected of conspiring a failed coup against Turkish President Recep Tayyip Erdogan in 2016. Mr. Erdogan hit back with promises of retaliatory measures and boycotts on American electronics, accusing the US of stabbing Turkey, a strategic partner, and ally, in the back.
Turkey’s currency crisis was developing long before the actions taken by President Trump. The lira was in free-fall for months due to an overheating economy, a large trade deficit, and Mr. Erodgan’s refusal to raise interest rates. Claiming baselessly that an international interest rate cabal was out to sabotage the Turkish economy, Erdogan himself damaged it further by appointing his own brother-in-law as central bank chief, effectively killing its autonomy to enact monetary policy apolitically. Despite the mild recovery over the last few days, Turkey’s crisis is far from over, with economists predicting a recession and a possible need for an IMF bailout.
It is impossible to find protagonists in a story about two autocrats lobbing trade barbs at each other. Mr. Erdogan should never warrant anyone’s pity. He is a brutal dictator, viciously persecuting political opponents and Kurdish minorities alike, leading the world only in the jailing of journalists, all while eroding Turkey’s free and secular democratic institutions to crown himself a de-facto sultan.
Furthermore, Mr. Erdogan’s complaints of being back-stabbed by his American ally also ring hollow. True, Turkey and the US are longtime NATO allies, currently cooperating in many hotspots around the world, notably Syria, Iraq, and Somalia. Turkey has also served a crucial role in many diplomatic efforts around the Middle East and has settled on an agreement to stem the flow of refugees to Europe via its territory.
However, Erdogan cannot be mistaken for the best friend of any Western country. His relationship with Europe and the US vacillates between ambivalent at best and toxic at worst. Having long ago dropped any pretense for wanting to join the EU (the union’s insistence on human rights proving too bothersome), Erdogan is instead deepening his ties with Russia. He is even purchasing the latter’s S-400 air defense system. This matters because, by operating with both NATO air weapons such as the F-35 and Russian air defense technology, Turkey is giving Russian intelligence officials ample opportunity to steal military information. In Syria, Turkey has hounded Kurdish forces allied to the US, even threatening US troops in the process. In other matters – from the use of its territory for air bases to the migrant agreement – Erdogan has sought to extort his position in exchange for Western leaders’ acquiescence to his cruelty at home and abroad.
That it was aspiring autocrat Donald Trump to be the first to stand up to Erdogan proves to be a cruel irony. The Trump administration is right to press for the release of an American citizen, but doing so via sanctions is heavy-handed and ineffective. It smacks more of Trump’s need to be seen as a strongman than any concrete diplomatic effort or change in policy, especially since the administration showed little concern with Erdogan’s aforementioned actions before. Turkey may end up letting Mr. Brunson go, and tensions may recede. However, by swinging a hammer to catch a fly, Trump needlessly caused economic uncertainties in many countries. The world would be better off without.