In Debate Over Turkey Sanctions, Trump Is the Wild Card

As Russia begins delivering an advanced missile system to Turkey, U.S. President Donald Trump’s administration is preparing harsh sanctions that could devastate Ankara’s already fragile economy. But the wild card could be Trump himself, experts and officials say.

The first parts the Russian S-400, which U.S. officials say threatens the F-35 fighter jet and NATO air defenses, were delivered to the NATO member on Friday, the Turkish defense ministry announced, a development that will trigger harsh penalties unless the president and Congress agree to waive them. It will also prompt the United States to cut Turkey out of the international F-35 program: Turkey will not be allowed to take delivery of its U.S.-made F-35 jets, Turkish pilots and program officials will be forced leave the United States, and the Turkish defense industry will lose valuable work on the program.

Both the U.S. State and Defense departments support imposing the harshest sanctions on Turkey, which could include cutting Ankara off from the U.S. financial system. But Trump, whose personal relationship with Turkish President Recep Tayyip Erdogan has made for some unexpected policy shifts, could choose to delay implementation of the sanctions—or try to waive them altogether.

“Sanctions will go to the White House, but Trump is the wild card and could sit on implementation,” said Aaron Stein, the director of the Foreign Policy Research Institute’s Middle East program.

During a meeting with Erdogan at the G-20 summit in Japan in June, Trump struck a conciliatory note, blaming former President Barack Obama’s administration for the dispute and promising to look at “different solutions” to resolve the issue.

“We have a complicated situation, because the president was not allowed to buy the Patriot missiles,” Trump said, referring to the Raytheon-built alternative to the S-400 the administration offered Turkey late last year. “So he buys the other missile and then, all of a sudden, they say, ‘Well, you can now buy our missile.’ You can’t do business that way.”

This characterization is not entirely accurate. Turkey actually passed over the Patriot twice before the most recent offer, which included better terms both on pricing and on coproduction. Both times, the deals fell apart because Ankara insisted on a transfer of the missile technology, something U.S. officials declined to do.

Despite the president’s remarks, State Department and Pentagon officials say the administration still intends to impose sanctions and remove Turkey from the F-35 program.

“The United States has consistently and clearly stated that Turkey will face very real and negative consequences if it proceeds with its S-400 acquisition, including suspension of procurement and industrial participation in the F-35 program and exposure to sanctions,” a State Department spokesperson told Foreign Policy.

However, this could change if Turkey threatens to block access to Incirlik, a key air base for U.S. forces fighting in the Middle East that also houses dozens of American nuclear weapons, one U.S. administration official said.

Describing the dynamics of the debate within the administration, the official said: “Erdogan believes he can talk Trump out of anything. The rest of the national security apparatus will push for full sanctions.”

Imposing additional sanctions and removing Turkey from the F-35 program could have serious financial repercussions for Ankara, potentially scaring off global investors and shaking confidence in the Turkish financial market, said Fadi Hakura, an expert with Chatham House. But more important than the financial impact is the damage it would do to Turkey’s global standing, he stressed.

“Turkey’s economy is incredibly fragile—it has a sizable private sector debt, primarily in U.S. dollars,” Hakura said. This would “put further pressure on the Turkish lira and could lead to panic in the Turkish system.”

The question is how sweeping the sanctions will be. Under the Countering America’s Adversaries Through Sanctions Act, the secretary of state is required to choose at least five of 12 options that vary in scope and severity. The most severe option would be cutting the Turkish government off from the U.S. financial system. Denying procurement contracts or limiting export licenses to Turkey could also have a significant impact.

Alternatively, the administration could choose to impose sanctions on a more specific entity, such as the Turkish Air Force or defense procurement agency.

Blacklisting the Turkish Air Force would significantly hurt Turkey’s defense industry, not only affecting its interactions with U.S. banks but also scaring off potential foreign investors.

The United States has imposed sanctions through the sanctions act, which was passed in 2017, only once before: on China’s procurement agency, the Equipment Development Department, in response to Beijing’s procurement of Russian Su-35 combat aircraft and equipment related to the S-400. The sanctions on the agency and its director, Li Shangfu, include the denial of export licenses and a prohibition on transactions with U.S. banks.

Hakura said the administration will likely opt for milder sanctions given Turkey’s strategic geopolitical importance, particularly because it is a member of NATO and hosts U.S. assets at Incirlik. But if Turkey continues buying military equipment from Russia, the dispute could escalate, resulting in harsher sanctions, he warned.

“I suspect that Turkey is heading towards a total breakdown over time with the U.S. and NATO,” Hakura said.

The sanctions would come at a particularly bad time for Ankara, with the Turkish lira already struggling and Erdogan fighting to hold on to power. Erdogan’s long-ruling Justice and Development Party, known by the acronym AKP, suffered a stinging defeat in the rerun of Istanbul’s mayoral election last month, with the opposition party’s Ekrem Imamoglu beating the AKP candidate by as many as 800,000 votes.

The Countering America’s Adversaries Through Sanctions Act gives the president broad authority to waive the sanctions in certain circumstances. But despite Trump’s relationship with Erdogan, experts say it is unlikely he will attempt to waive the sanctions entirely, as they have bipartisan support in Congress, as well as the backing of the State and Defense departments. A presidential waiver would be subject to congressional review, according to the law.

It is possible that Trump either stalls on the implementation of sanctions or asks Congress to waive them altogether, wrote Byron Callan of the Capital Alpha group in a note to investors. But the latter is going to be “a very tough sell to Congress,” he wrote.

“I believe Turkey will be hit with sanctions, the only question is how severe they will be and when they get implemented,” said Stein, of the Foreign Policy Research Institute.

U.S. allies will be watching Trump’s decision closely. Several allies have plans to buy Russian defense equipment: India has five S-400 batteries on the books, while Egypt and Indonesia are considering procuring Su-35 combat aircraft, according to Callan.