A growing diplomatic dispute between the U.S. and Turkey could have a “deep impact” on trade, according to a group that promotes bilateral commerce and that called for both sides to defuse the standoff.
The decisions by Washington and Ankara to suspend visa services for each other’s citizens create headaches for U.S. companies with significant business interests in Turkey, ranging from Ford Motor Co. to General Electric Co., Coca-Cola Co. and Citigroup Inc., as well as their Turkish counterparts in the U.S.
“This will have a very deep impact on many things, especially in trade, if it is prolonged,” Ekim Alptekin, head of the Turkey-U.S. Business Council, said in a telephone interview. “We would expect the sides to show common sense in solving the problem, not to escalate it.”
The diplomatic tension erupted after the Oct. 4 arrest of a Turkish national who works at the U.S. consulate in Istanbul, over alleged involvement in the July 2016 coup attempt against President Recep Tayyip Erdogan. Hours after the Trump administration halted visa services in Turkey on Sunday, Erdogan’s government responded in kind, even repeating verbatim much of the U.S. statement.
The U.S. on Thursday called charges against the man without merit, saying it was “deeply disturbed” by the arrest and by “leaks from Turkish government sources seemingly aimed at trying the employee in the media rather than a court of law.” Turkey responded by saying the arrested Turkish citizen wasn’t part of the U.S. consulate’s staff but a local employee.
The U.S. is Turkey’s fifth-biggest trade partner with the volume of bilateral commerce standing at $17.3 billion in 2016, according to Turkey’s statistics office data.
More than 1,700 U.S. companies have significant investments in Turkey, according to the Ankara-based economy ministry’s website. Turkish concerns with a big U.S. presence include pipe-maker Borusan Mannesmann Boru Sanayi, cement producer Cimsa Cimento Sanayi and industrial fiber maker Kordsa Global.
Affiliates of U.S. companies listed on Borsa Istanbul, which tumbled as the diplomatic tension between Ankara and Washington deepened, include the following:
- Ford Otomotiv Sanayi AS: Produces commercial vehicles and trucks in joint venture with Turkey’s biggest business group, Koc Holding AS, in two plants in western Turkey. Shares fell as much as 4 percent in Istanbul
- Coca-Cola Icecek AS: Bottler of Coke products in Turkey and nine other countries in Central Asia and Middle East, in partnership with Istanbul-based Yazicilar Holding and Ozilhan Holding. Shares fell as much as 4.7 percent
- Goodyear Lastikleri TAS: Manufactures tires, tubes and tube-covering materials for automotive industry. Shares fell as much as 8.7 percent
- Olmuksan International Paper Ambalaj Sanayi: Produces corrugated cardboard cases and boxes for industrial and agricultural products. Shares fell as much as 8.9 percent