German business warns Turkey trade will plunge amid escalating diplomatic row

Source: The Local

German business groups warned Thursday that economic ties with Turkey would go from bad to worse as a sharply escalating diplomatic row heightens uncertainty.The biggest EU economy, home to three million people of Turkish origin, has repeatedly clashed with President Recep Tayyip Erdogan over civil rights and other issues, especially since a failed coup attempt a year ago sparked mass arrests. After Turkey remanded in custody several human rights activists, Foreign Minister Sigmar Gabriel said that Germany – Turkey’s top trading partner, number-two foreign investor and biggest source of tourists — would launch a sweeping overhaul of bilateral relations.German holiday-makers were urged to exercise “heightened caution” in Turkey, and Gabriel said Berlin would review investment aid and state guarantees and discourage German companies from doing business there.“You can’t advise someone to invest in a country where there is no legal certainty and even completely innocent companies are linked to terrorism,” said Gabriel.German business federation BGA, which represents exporters and wholesalers, predicted that “the uncertainty German companies already feel will now rapidly increase”.“Many companies have already put their investments on ice,” said its spokesman Andre Schwarz.“We must expect significant declines in exports if the measures being considered are implemented, and investments too will suffer.”The Federal Association of German Industry (BDI) warned that “the uncertainty of the past year is already causing more and more German companies to distance themselves from Turkey”.“Turkey is hurting itself.”

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