U.S. sanctions on NATO-ally Turkey might deter future arms deals with the likes of Moscow, but it could also play into Russian President Vladimir Putin’s hands, CNBC writes.
Turkish dollar-denominated bonds and the lira have both fallen in recent days amid economic and geopolitical turmoil for Turkey, with investors concerned about its credibility and the potential for U.S. sanctions over a Russian weapons deal.
Turkish President Recep Tayyip Erdogan sacked the country’s central bank governor earlier this month, prompting fresh criticism regarding the institution’s independence and leading ratings agency Fitch to downgrade Turkey’s investment rating to “BB-.”
But looking ahead, market watchers are now worried about the American response to what continues to be a significant headache for NATO: Ankara has officially begun receiving parts for the Russian S-400 air defense missile system, the result of a weapons deal that Washington has long lobbied hard against.
Senators are now urging President Donald Trump to slap sanctions on Turkey. Erdogan “has chosen a perilous partnership with (Putin) at the expense of Turkey’s security, economic prosperity and the integrity of the NATO alliance,” four senators, including chairmen of the Senate Armed Services Committee and the Senate Foreign Relations Committee, said in a bipartisan statement last week.
U.S. officials see the deal as a threat to NATO, for which Turkey provides the second-largest military. And according to Pentagon officials, it’s a security risk to the American-made F-35 stealth fighter jets, 116 of which have been sold to Turkey, as allowing the S-400 and F-35s to operate near one another could allow for Russian intelligence gathering on the American system, CNBC added.
Sanctions, the senators hope, would send a clear message about NATO members buying weapons from non-NATO countries, particularly those considered adversaries of the 70-year-old alliance.