FT: EU considers imposing sanctions against Turkey due to cooperation with Russia

European officials have been extremely puzzled by the rapprochement between Russia and Turkey and are seriously considering imposing sanctions against Ankara if the republic helps Moscow bypass Western sanctions. This is written by the British Financial Times with reference to six European officials who are aware of informal discussions within the European Union.

The EU is concerned about the statements by the leaders of the two countries about increasing trade and cooperation in energy, finance and trade. One of the sources of the publication admitted that there have not yet been official negotiations among the EU countries, but the bloc is “more closely monitoring Turkish-Russian relations.” Another source of the publication admitted that the EU is considering putting pressure on Western companies and banks to either leave the market or reduce their presence in Turkey in case of helping Moscow to circumvent sanctions.

Such restrictions could undermine the economy of the Republic of Turkey, which is already suffering from record inflation. However, there is no consensus in the EU on such steps; moreover, there is a high risk that many countries will not want to lose the Turkish market, which is profitable for their companies, and will oppose such initiatives. However, individual EU states could still put pressure on Turkey, the sources say.

“For example, they may ask for restrictions on trade finance or ask major financial companies to cut funding for Turkish companies. I would not rule out any negative actions if Turkey gets too close to Russia,” one of the European diplomats told the publication.

The FT also recalls that Turkish representatives are well aware of the possible risks, since in June US Deputy Treasury Secretary Wally Adeyemo held a working meeting with representatives of Turkish businesses and banks and warned them of Washington's readiness to impose secondary sanctions for cooperation with Russia. Nevertheless, at least one increase in cooperation in the banking sector after the talks between the presidents of Russia and Turkey will take place - Recep Tayyip Erdogan announced the accelerated integration and development of the Russian payment system Mir in the republic.

The announcement particularly alarmed European officials, who saw it as an opportunity to circumvent financial sanctions. The Turkish and Russian sides insisted that this would make life much easier for Russian tourists, who would be able to pay for local services. Also, Russia and Turkey agreed to switch to settlements in national currencies, which should help Turkey maintain foreign exchange reserves and strengthen the lira. A separate point of the agreements was the transfer of payment for Russian gas in rubles.

Since the beginning of the Russian war against Ukraine, the Turkish authorities have adhered to the so-called “balanced neutrality”. The Turkish authorities are actively involved in the conflict as a negotiator, Erdogan provided Istanbul as a negotiating platform for military negotiations, and Turkey has also helped to resume the supply of grain to world markets from Ukraine. However, Western states fear that "balanced neutrality" could turn Russia into a "window of opportunity" to circumvent sanctions.

At the same time, Turkey has so far refused military cooperation with Russia; Baykar Makina has refused Vladimir Putin's proposal to build a plant for the production of Bayraktar-type drones in Russia. The director and co-owner of the company is Selçuk Bayraktar, who is the son-in-law of the President of Turkey. The company actively supports Ukraine and supplies it with its products, which are used by the Armed Forces of Ukraine at the front.

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