Volkswagen AG said it will not build its first factory in Turkey while the government of President Recep Tayyip Erdoğan wages war against Kurdish militants in neighbouring northern Syria.

The company has postponed its decision until the end of the year even though a plant in Turkey is in its economic interests, chairman Herbert Diess said in an article on LinkedIN on Wednesday.

“As long as people are being killed, we are not laying the foundation stone next to a battlefield,” Diess said. Volkswagen shared the assessment of the German government and the European Union, he said.

Turkey entered northern Syria early last month, sparking an international outcry. U.S. and European politicians say the incursion puts the local, mainly Kurdish population at risk and raises concerns about ethnic cleansing by Islamic militia allied with Turkey. Ankara says it is battling Kurdish fighters who are indistinguishable from the Kurdistan Workers’ Party (PKK), an autonomy-seeking group in Turkey labelled as terrorists by the EU and the United States.

“With its large market and good industrial base, Turkey is a very suitable production location for us,” Diess said. “However, we are convinced that if businesses think that international law and human rights are the sole responsibility of governments, the market economy loses its ethical foundation.”

Diess said Volkswagen had yet to make a final decision on where to base its new plant. It had considered Romania as an alternative.

The Turkish press had hailed the German carmaker’s decision to build the factory – set to assemble the VW Passat and Skoda Superb models – as a sign that foreign investors are once more warming to Turkey. Investment in the country, which was flourishing earlier this decade, has dropped sharply since a failed military coup in 2016, the introduction of a full presidential system of government in June 2018 and a currency crisis two months later that sent the economy into a tailspin.

But critics of the investment have argued that the it could be used by the Erdoğan government as a means to boost its popularity while human rights infringements and the erosion of democracy in the country continued.

“Our decision on a new plant in Turkey is still open,” Diess said. “Only one thing is certain: Ethical action is not synonymous with simple answers. That applies to governments. And it applies to us.”