Turkish minister expects U.S. ties to survive

ISTANBUL — Turkey's defence industries chief said U.S. sanctions against him and his agency for buying Russian missile systems would not have a big impact on ties and may boost domestic development, though the defence minister said the move had “shaken” their alliance.

The sanctions, announced at a delicate moment in the fraught relations between the two NATO partners as President-elect Joe Biden prepares to take office, could affect contracts worth US$1.5 billion to US$2.3 billion, around five per cent of U.S.-Turkish trade.

Ankara has condemned the measures as a grave mistake, but the lira firmed after their announcement, having been pressured for more than a year by the prospect of U.S. punishment for Turkey's purchase of the Russian S-400 air defences.

The sanctions avoided targeting Turkey's economy generally, focusing on its arms procurement and development body Defence Industries Directorate (SSB), its chairman Ismail Demir, his deputy and two officials responsible for air defence systems.

They do not cancel existing contracts or prevent either side procuring vital defence needs — including parts for the U.S. F-35 stealth fighter still being produced in Turkey, or spare parts for Turkey's F-16 jets.

“We expect this will not influence our relations much,” SSB head Demir said on Tuesday. “We are NATO allies. As they themselves said, there is cooperation with Turkey in many areas. We and they expect this to continue,” he said in comments broadcast by state-owned Anadolu news agency.

The so-called U.S. CAATSA sanctions, designed to deter any country from agreeing military deals with Russia, also restrict U.S. loans and credits to SSB, although that is not seen as having a significant impact.

“We will find remedies for this in our own circles,” Demir said.