EU sanctions threat lacks teeth to ease east Med tensions

Tensions between Ankara and Athens have for now marginally diminished following the withdrawal of Turkish seismic vessel Uruc Reis and its naval escort from the south of Greek island Kastellorizo. NATO is meanwhile brokering talks between Turkish and Greek representatives to put deconfliction mechanisms in place to prevent clashes over energy and maritime rights in the east Mediterranean.

The NATO initiative represents a small, preliminary step in resolving a decades-long dispute between its members over territorial delineation in the Aegean and east Mediterranean.

Although Turkish and Greek officials say they are willing to return to long-stalled negotiations on territorial rights, the risk of failure and a return to intensified friction and brinkmanship around contested waters remains high.

By extension, the EU threat of new sanctions against Turkey still stands if Ankara fails to halt all exploration in the east Mediterranean’s contested waters. If adopted, new EU sanctions will likely lack the teeth required to force Turkey to abandon its muscular policy. Divisions within the EU and the fiercely nationalist bent of Turkish politics will continue to inhibit the club’s leverage over Ankara. Turkey will, for the most part, negotiate on its own terms.

Erdogan to continue exploiting divisions within Europe

The EU’s ability to force Turkey to cease all exploration activities in the east Mediterranean will, in our view, remain inhibited by its lack of consensus on how to manage Ankara.

Europe is unlikely to wave a big enough stick to force capitulation. The only way biting sanctions would be imposed would be through a unanimous vote from all 27 EU members.

This is an unlikely prospect. While France, Greece and Greek Cyprus advocate a hardball approach to Turkey, EU Council President Germany wants to avoid escalation, opting instead for ongoing talks where an expanded customs union agreement sits on the table with limited sanctions in the back pocket. Italy, Spain and Malta likewise prefer to exhaust the diplomatic track before applying coercive measures should Turkey continue to explore unilaterally in the east Mediterranean’s disputed waters.

There is nonetheless a high risk that EU members will be forced to expand the existing sanctions regime to demonstrate solidarity with Greece and Greek Cyprus should EU-brokered talks fall flat. European Foreign Minister Josep Borrell has said this might include measures to prevent Turkish vessels from docking at EU ports and sanctions against select individuals, plus financial and other resources linked to Turkey’s upstream sector.

Limited sanctions will probably not on their own precipitate a full economic meltdown in Turkey, but the economy is already heading towards a balance of payments crisis marked by depleted foreign exchange reserves, dollarization and eroded fiscal buffers. When cornered, Erdogan typically lashes out at what he defines as domestic or external subversive forces and the EU is likely to once again be at the receiving end of the president’s ire.

Migration still the weapon of choice in Turkey’s arsenal

One of the largest weapons in Turkey’s arsenal remains the millions of Syrian and other migrants it hosts as part of the fragile Turkey-EU migrant deal. As occurred in February, Erdogan could once again open the Turkish side of the joint border with Greece and actively encourage thousands of migrants to cross by land or sea. European politicians want to avert an intensifying migration crisis this autumn or next spring as COVID-19, the single biggest domestic challenge, persists.

President Erdogan has a second, albeit imperfect, weapon at his disposal: the threat of retaliation against those European foreign investors which still have interests in Turkey. In May 2017, Turkish authorities lodged a complaint with Interpol against almost 700 German companies with operations in Turkey for alleged links to terrorism – a complaint which Ankara withdrew following intensified pressure from Berlin. It is not beyond the Turkish government to threaten European businesses again even if this plunges the Turkish lira to a new low.

European sanctions also risk backfiring in Libya, where Turkey is the chief political sponsor of the UN-recognised Government of National Accord (GNA). In the event of sanctions, Ankara is likely to be even less receptive to future efforts led by European states to achieving an all-elusive lasting peace deal to secure the EU’s southern flank.

Domestic political configuration unconducive to compromise

Domestic politics in Turkey will remain an obstacle to a negotiated settlement on territorial waters and the status of the divided island of Cyprus. President Erdogan has not only sought to use friction with Greece and Greek Cyprus in the east Mediterranean and Aegean seas to distract attention from domestic economic pressures. He is also using it to set the narrative among Turkish nationalist and ultra-nationalist constituents who advocate a muscular, militarised policy of power projection in the Aegean and east Mediterranean.

Importantly, Erdogan cannot afford to be seen to be weak when dealing with the EU at a time when local opinion polls show the opposition ultra-nationalist IYI party outperforming the ruling AK Party’s ultranationalist coalition partner, the MHP. The AKP depends on MHP support in parliament. This means that the Turkish government needs to be able to characterise the outcome of future talks with Greece and Greek Cyprus as a clear win for the nation.

The gloomy outlook for a negotiated deal on the Aegean and east Mediterranean does not derive solely from Turkish activities. Greece’s own jingoistic rhetoric and retaliatory actions for Turkish exploration in waters it claims as its own helped inflame bilateral tensions in recent weeks. Notably, in August Athens signed a maritime delimitation agreement with Cairo at the expense of Turkey in retaliation for a similar MoU signed between Ankara and Libya’s Government of National Accord (GNA).

So long as Greece and Turkey fail to make concessions and continue disagreeing on the legality of one another’s actions in the east Mediterranean and Aegean, the region will remain a geopolitical flashpoint. Turkey will maintain that waters recognised by the international community as belonging to Greece and Greek Cyprus are in fact those of Turkey or Turkish Cyprus. 

A breakthrough in future talks not only requires some readiness to compromise but also a degree of trust. Athens and Ankara exhibit little of either.