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Turkey and US start new trade war
Turkey imposed high tariffs on US cars, alcohol, tobacco and other products on Wednesday as the economic and diplomatic row with the US escalated.
The Turkish government published the list of tariff increases on the country’s Official Gazette. Tariffs on US alcohol will triple to 140 per cent, double on rice imports to 50 per cent and more than triple on US cars to 120 per cent.
Ankara’s retaliatory trade measures were announced in response to US President Donald Trump’s decision on Friday to impose additional tariffs on Turkish aluminium and steel. White House spokeswoman Sarah Sanders said: “The tariffs from Turkey are certainly regrettable and a step in the wrong direction. The tariffs that the United States placed on Turkey were out of national security interest. Theirs are out of retaliation.”
The Turkish lira fell by more than 20 per cent last week and hit a record low of seven lira against the dollar on Tuesday, though it recovered to 6 lira on Wednesday after Turkish President Recep Tayyip Erdoğan announced the tariffs on US goods and after Qatar announced that it would invest $15bn in Turkey’s economy.
Qatar’s investment is being interpreted as payback for Turkey’s staunch support after Saudi Arabia, United Arab Emirates and Egypt blockaded Qatar last year. The offer came as Erdoğan hosted Sheikh Tamim bin Hamad Al-Thani, Emir of the Gulf state, for a working visit in Ankara yesterday. President Erdoğan also spoke with German chancellor Angela Merkel yesterday.
Tensions between the US and Turkey heightened recently due to a disagreement over the fate of North Carolina Pastor Andrew Brunson. Turkey imprisoned Brunson in October 2016, claiming he had ties to a Gulenist group that Erdogan blames for the failed coup earlier that year.
In addition to its decision to increase tariffs on imports of Turkish steel and aluminium, the Trump administration earlier this month imposed sanctions on two top Turkish officials in President Erdogan’s Cabinet as part of its efforts to pressure Turkey into freeing Brunson.