US tariffs to stay as ally aids Turkey
Qatar’s emir pledges $15b in investment to support currency
ISTANBUL/WASHINGTON — The United States has ruled out removing steel tariffs that have contributed to a currency crisis in Turkey even if Ankara frees a US pastor, as Qatar pledged $15 billion in investment to support a rise in the Turkish lira.
The US stance appeared to give Turkish authorities little incentive to work for the release of Andrew Brunson, a pastor on trial in Turkey on terrorism charges and whose case Turkish officials have said was a matter for the courts.
The dispute is one of several between the NATO allies, including diverging interests in Syria and US objections to Ankara’s ambition to buy Russian S-400 defense systems, that have contributed to instability in Turkish financial markets.
While the Brunson matter appeared far from being resolved, Turkish President Tayyip Erdogan got a shot in the arm from Qatar’s emir, who approved a package of economic projects, investments and deposits after the two met in Ankara.
State media in Doha said Sheikh Tamim bin Hamad al-Thani was traveling to Turkey for a “working visit”.
The Qatari money will be channeled into banks and financial markets, a Turkish government source said.
Close partners
Turkey and Qatar — which is also US ally — have become close economic and political partners in recent times.
Doha has $20 billion worth of investments in Turkey, official figures showed last month, and Ankara is now one of the top exporters to the emirate.
The latest move by Qatar offered further support to a lira rally. The Turkish lira continued to rebound on Thursday, one day after Qatar pledged those investments.
The lira has lost nearly 40 percent against the dollar this year, driven by worries over Erdogan’s growing control over the economy and his repeated calls for lower interest rates despite high inflation.
The dispute with the US and Turkey’s detention of Brunson helped turn the currency’s steady decline into meltdown.
It touched a record low of 7.24 to the dollar early on Monday, rattling global stock markets and threatening the stability of Turkey’s financial sector.
US President Donald Trump doubled tariffs on Turkish metals exports to the US last week, prompting Turkey, which said it will not bow to threats, to raise tariffs on US cars, alcohol and tobacco by the same amount on Wednesday.
US Vice-President Mike Pence called the Turkish response a step in the wrong direction and signaled a hard line on Brunson’s release.
White House spokeswoman Sarah Sanders made clear the US had no plan to remove the steel tariffs if Brunson were released, though she said it could remove sanctions on two senior Turkish officials.
Meanwhile, the US State Department joined the chorus denying US responsibility for Turkey’s economic troubles.
State Department spokeswoman Heather Nauert said that “Turkey’s financial situation has been in the works for quite some time and it dates before the imposition of sanctions” on Aug 1.
Turkish Foreign Minister Mevlut Cavusoglu struck a somewhat conciliatory note, saying Turkey was ready to discuss its issues with the US as long as there are no threats.
There was also optimism about better relations with the European Union after a Turkish court released two Greek soldiers pending trial. Cavusoglu said ties with the bloc, long strained, were on a firmer basis and had started normalizing.