EU, Germany deliver bad news to Turkey, undermining economic recovery

Efforts by the Turkish government to steer Turkey towards normalisation and economic recovery following the outbreak of the coronavirus pandemic are facing hurdles from Europe.

Over the past week, Ankara has received a string of bad news from the European Union and Germany, undercutting plans to boost the country’s ailing economy, which was tentatively recovering from a recession before the pandemic struck.

Turkey was still in shock from an announcement from the European Council, the EU’s highest political body, that it was not among the non-EU countries the bloc would open its doors to as of July 1, when it received news that German automotive giant Volkswagen had scrapped plans for a car plant in western Turkey.

Following months of foot-dragging, Volkswagen said it would not build the 1.3 billion-euro factory, citing a slump in demand caused by the COVID-19 pandemic.

Last year, the company had begun preparations for the plant in the province of Manisa after founding a local unit, Volkwagen Turkey Otomotiv Sanayi ve Ticaret, and beginning work on land allocated to it by the Turkish government free of charge.

The facility, which was to produce over 300,000 cars a year, was slated to begin production in 2022 and employ over 4,000 people. In an attempt to pull in much-needed foreign investment, President Recep Tayyip Erdoğan has become personally involved in providing an incentives package to Volkswagen, which included various exemptions and tax breaks. Moreover, assurance had been given to the company that 40,000 of its Passat model automobiles would be purchased by state institutions as official vehicles.

Despite the promises made by the Erdoğan government, Volkswagen announced in October of last year that it had suspended plans for the plant due to Turkey’s cross-border operation into northern Syria targeting Kurdish militants allied with the United States and the West against Islamic State (ISIS).

Last week, the company delivered the final blow.

In other bad news from Germany, Berlin announced last week that it had extended travel restrictions with Turkey until August 31. Soon thereafter, the European Council announced that the EU had opened its doors to citizens of the following countries: Algeria, Australia, Canada, Georgia, Japan, Montenegro, Morocco, New Zealand, Rwanda, Serbia, South Korea, Thailand, Tunisia and Uruguay.

Needless to say, Turkey’s absence from the list created disappointment in Ankara.

The government was quick in attempting to convince Berlin to add Turkey to the list of approved countries, sending the foreign and tourism ministers last week, as well as the deputy health minister.

Furthermore, the government which has come under criticism from some health experts at home over its lack of transparency concerning COVID-19 data, published a comprehensive report and shared it on the Health Ministry’s website.

While Turkish dossiers on the pandemic were shared with the German government, Turkey’s Deputy Health Minister Emine Alp Meşe gave a briefing to the Robert Koch Institute, an autonomous state-run German authority on the outbreak and other health issues.

Germany, in response, said that it would examine the files and evaluate Turkey’s position, while also informing Turkish ministries that as the EU’s rotating president, Berlin should not be expected to act differently from other EU member states and institutions.

Erdoğan reacted to the statements and decisions coming from Germany and the EU during the opening of a hospital in Istanbul over the weekend. Turkey’s strongman reiterated his claim that Turkey has been among the most successful countries in battling the pandemic, that Ankara had sent medical equipment to 138 countries and that many European and other countries were jealous of Turkey’s success.

Erdoğan vowed that Turkey would be the “health centre of three continents.’’

“This time, they will not be able to stop Turkey’s rise. We have arrived at the present day by defeating the enemies of Turkey, one by one,’’ Erdoğan said on Sunday, referring to the EU.

Following Erdoğan’s statement, it is not expected that an official visit from a top EU official on Monday will yield any results. Ahead of his arrival in Ankara, EU foreign affairs commissioner Josep Borrell had visited Greece and Cyprus last month, where he stated that Turkey’s recent drilling activities in the eastern Mediterranean around Cyprus were illegal.

Ankara reacted strongly to the statements of Borrell, who is expected to discuss the latest developments in the east Mediterranean, the war in Libya and the migrant crisis at the Turkey-Greece border, among other topics. Meanwhile, France is expected to call on the EU to increase its yet-to-be applied sanctions against Turkey for drilling off Cyprus at an EU leaders’ meeting this month.

In light of all these developments, the start of a positive period in Turkey-EU and Turkey-Germany relations, just days after Berlin has taken over the rotating presidency of the bloc, seems unlikely.

Even before the pandemic, Germany had warned its citizens about travelling to Turkey, saying they could be arrested over their social media posts or banned from leaving the country. Such warnings made by the German Foreign Ministry last year are still officially in place.

 Moreover, German Foreign Minister Haiko Maas’ statement to his Turkish counterpart Mevlüt Çavuşoğlu in their meeting last week that Berlin expects Turkey to take steps towards democratisation, proves that the travel warnings are not only due to the pandemic.

The day after Volkswagen announced it had thrown in the towel on the Turkey plant, the Turkish Competition Authority (TCA) launched an investigation into five German automotive giants for violating competition laws. The move has increased concerns that foreign investment in the country, already in a slump, will be affected further.

The probe into Audi, Porsche, Volkswagen, Mercedes-Benz and BMW follows claims that the companies cooperated in matters of security, the environment and shared competition-sensitive information.

The investigation has led to expectations in finance circles that the five German automotive companies will be slapped with heavy fines and sanctions.

Pro-government circles are denying that the investigation is linked to Germany’s travel restrictions or to Volkswagen’s move, saying that the TCK is an independent organisation. They also maintain that the timing of the probe, arriving on the heels of the announcement to scrap the plant in Turkey, is entirely a coincidence.

But the present picture and the latest developments over the last week show that tensions will escalate between Ankara and Berlin, which have turned into somewhat of a wrestling match.

While there are no expectations of tangible results from Borrell’s visit, there is talk that Ankara may resort, once again, to sending migrants to its northwestern frontier with Greece, souring relations with Europe further.

The opinions expressed in this column are those of the author and do not necessarily reflect those of Ahval.