As the economic crisis in Turkey intensifies, Germany should decide whether and how it wants to help

Since Turkish President Recep Tayyip Erdoğan arrived in Germany for a state visit this morning, central Berlin has resembled a fortress. The extreme security measures are warranted: unlike the many high-level visitors who remain relatively unnoticed as they come and go, Erdoğan has been a divisive figure in the country, particularly in the past few weeks. After meeting German President Frank-Walter Steinmeier (with military honours and a state banquet), Erdoğan and Chancellor Angela Merkel will have two meetings in two days in the city. On Saturday, the Turkish president will travel to Cologne to attend the opening of a mosque.

Many Germans have come to see Erdoğan as the force behind Turkey’s slide into autocracy. The Turkish authorities’ detention of journalists, members of minority groups, and activists – including Germans – have undermined German-Turkish relations. So too have the president’s often wild accusations against Germany, and his successive electoral campaigns in the country to mobilise support for his vision of a new Turkey. The resulting tensions will be on display around meeting tables and – assuming there are large-scale protests, as expected – on the streets of central Berlin this week.

Keenly aware of these sensitivities, Erdoğan’s hosts have carefully planned the format and timing of the visit. For them, the crux of the matter is that Turkey has been a difficult partner for Germany in recent years, but also a crucial one. Germany perhaps needed the March 2016 ‘one in, one out’ refugee deal between the European Union and Turkey – which has significantly reduced the number of refugees and other migrants arriving in Europe – more than any other member state. This agreement is still a major pillar of Europe’s migration policy. And, while neither the EU nor its members play a major role in Syria, it is in Berlin’s interest to engage with the key players in the conflict there – among which Turkey appears to be relatively cooperative (compared to Russia or Iran).

As Germany is Turkey’s most important trading partner, the Turkish economic crisis is also cause for concern in Berlin. The crisis will be an especially awkward issue for the sides to deal with during Erdoğan’s visit. In Ankara last week, I often encountered an odd sense of denial about Turkey’s economic problems, along with a strong confidence that Turkey would improve its trade relations with Germany and other European countries, as well as states elsewhere. In contrast, the government in Berlin appeared to spend part of the summer devising a plan to support the Turkish economy, lest it plunge into deeper turmoil. In August 2018, Social Democratic Party (SPD) leader Andrea Nahles suggested that, despite bilateral tensions, Germans should act to prevent further instability in Turkey. Nahles’ statement was widely interpreted as a call for a European bailout, but it turned out that this was not her intent.

Germany will have to leave its comfort zone if the economic crisis becomes markedly worse

Since then, the SPD leader has left the task of “talking Turkey” to Foreign Minister Heiko Maas, who visited the country in September to make overtures on normalising German-Turkish relations. Economics Minister Peter Altmaier (who, during his tenure as head of Merkel’s chancellery, played a central role in crafting the refugee deal) will travel to Turkey in October, accompanied by a large business delegation.

Aside from stronger trade ties, Turkey will also push for a renewed framework for the economic relationship. In a rather bold change of tone and substance, the Turkish government has once again hailed the prospect of Turkey joining the EU and “modernising” its customs union with the bloc. Berlin is unlikely to favour either move, due to the deterioration of the rule of law and human rights protections in Turkey. But, regardless of the German stance, neither a renewed commitment to EU accession nor a renegotiation of the customs union would help Turkey. Both would be long-term processes that involved a whole series of unknowns along the way – and, as such, would be unlikely to have major short-term effects if Turkey’s economic crisis worsens in the coming weeks.

The current view in Germany’s governing circles is that Ankara will be able to rescue itself from the crisis. Whether Ankara will actually do so remains unclear. Although it has not come out of the blue, the crisis has developed with surprising speed in recent months. Germany will have to leave its comfort zone if the crisis becomes markedly worse, assessing whether and how to help stabilise Turkey. For now, it looks unlikely that the International Monetary Fund (IMF) will play a role in this, since President Erdoğan has categorically ruled out the option. And, even if Ankara changed its position, the United States could block Turkey’s access to IMF funding. In this scenario, what would Berlin do if Ankara turned to Europe for help?

Erdoğan’s visit will reveal the extent to which leaders in Berlin are at loggerheads with the German public over the relationship with Turkey. Yet all parties need to prepare themselves for a significant shift in the intensity of the relationship, should Turkey’s crisis become more acute. Although the Turkish president wants to project an image of strength during his visit, it is Turkey’s vulnerabilities that really worry Berlin. In this sense, Nahles was right: Germany cannot look aside.

Read more on: Note from Berlin, Wider Europe, Turkey, European Power, European Strategy