Trump Administration's Tariffs on Turkey 2018
Updated: Oct 7, 2020
(Edited by Daibik Chakraborty)
On July 15, 2016, a failed coup d’etat occurred in Turkey against the government of President Recep Tayyip Erdoğan. The Turkish government has accredited the coup to the Gülen movement, a transnational Islamic social movement inspired under the teachings of Fethullah Gülen. The movement is labeled a terrorist organization by the Turkish government, and Gülen currently lives in self-imposed exile in the United States. Gülen has decried the coup and denied any connections to it. After the coup, a series of purges by the government of Turkey began, arresting public servants, soldiers, and others alleged to be connected to the Güllen movement. Among these arrests was American Protestant Christian pastor Andrew Brunson, arrested October 7, 2016.
In September of 2017, Erdoğan suggested the swapping of Brunson for Gülen, which the United States declined. On July 19, 2018, US President Trump tweeted support for Brunson, urging the Turkish president to free him. When these requests were not met, Vice President Mike Pence stated on July 26, 2018 at the first Ministerial to Advance Religious Freedom that the United States would impose economic sanctions on Turkey unless Brunson was freed. On August 1, 2018, after the requests were yet again not satisfied, the US Treasury Department placed financial sanctions on two Turkish government officials. Justice Minister Abdulhamit Gül and Interior Minister Süleyman Soylu, who were involved with Brunson’s detainment, were blocked from the US financial system, and any assets they had under US jurisdiction were frozen.
On August 8, 2018, US Deputy Secretary of State John Sullivan and Turkish Deputy Foreign Minister Sedat Önal met at Washington in attempts to end tensions between the two nations. A conclusion on the future of Brunson was not made. On August 10, 2018, President Trump announced on Twitter a 20% aluminum and a 50% steel tariff on Turkey, compared to the 10% aluminum and 25% steel tariff he placed on multiple countries in March 2018. A statement by the White House has confirmed that the tariffs would be put in place, but stated that it was unrelated to trade negotiations, and rather for the purpose of protecting national security.
The new tariffs put on Turkey by the US has also been influenced by President Trump’s trade policies, as well as other countries responses. Turkey had responded to the original 10% aluminum and 25% steel tariffs the Trump administration had placed by placing their own higher tariffs on US coal, paper, almonds, tobacco, unprocessed rice, cars, cosmetics, machinery equipment, petrochemical products and many other items, which was estimated to be around $266.5 million in trade.
The Turkish currency, the lira, has dropped severely in value due to these tariffs. There has been an estimated 17% drop in its value on just August 10 alone. Many investors and economists believe that this will push the Turkish economy into crisis. Turkey is the US 32nd trading partner, trading $17.4 billion between the two in 2016, while the US is Turkey’s 5th trading partner. Turkey has since placed higher tariffs on US products in response to the 20% aluminum and 50% steel tariffs placed on them. Erdoğan has signed a decree which doubles the tariffs on US passenger cars to 120%, alcoholic drinks to 140%, and tobacco to 60%, among other goods. On August 15, 2018, Qatar announced it would be investing $15 million dollars into economic projects and investments for Turkey after a meeting between Qatar Amir Tamim bin Hamad Al Thani and Turkish President Recep Tayyip Erdoğan.