Germany determines EU decisions

After German Chancellor Angela Merkel said the customs union agreement would not be updated, almost every minister made statements last week saying Germany and the European Union were two separate things. 

This may be the case on paper, but everyone is actually aware that Germany de facto determines the rules of the EU. 

When we look at Merkel’s statement, we see that not only the renewal of the customs union agreement but the relationship between the EU and Turkey as a whole is entering a very difficult period. 

It is clear that problems will occur even in the existing ongoing agreements.

Before Merkel’s remarks, the Turkish government had begun saying that relations with Germany would normalize after the German elections in September were over. But after Merkel’s statement, the situation became very tense. The ministers tried to soften the situation by saying they considered the EU separate from Germany. However, there was a call for Turks in Germany who were told “not to vote for these parties.” This statement, in my opinion, destroyed the hopes of relations improving.  

In brief, it appears that the possibility of relations normalizing between Turkey and Germany after the elections in the latter decreased. So it is possible to say that problems Turkey is set to face because of the situation just began. Relations between Turkey and Germany go way back and are interlinked in many areas. It is very clear that the worsening of relations will negatively affect the lives of the Turks living there. But there is also a very high probability that this crisis is not only limited to the three million Turks living in Germany, and that it will also negatively affect all citizens living in Turkey. 

Germany has a very strong influence over EU decisions. It is the most influential member of the EU. Its political power has also increased in accordance with the recent strength to its economic power. Let me put it this way: Germany on a vast scale can issue every decision they want in the EU but it is not possible for the EU to make a decision that Germany does not want. Up until now Germany was the one curbing harsh attitudes by countries like the Netherlands and Austria against Turkey.


Effects on trade and finance

To what degree will Germany and the EU affect Turkey’s performance?

Customs and Trade Minister Bülent Tüfenkci said the political blackmails should not be an obstacle to trade. Of course, the statements of Tüfenkci points toward an ideal situation, but the truth is that every country, including Turkey, uses trade and economic relations in their internal and external affairs as a trump card in accordance with their power. Of course, Germany will also be affected negatively from the deterioration in relations but what is very obvious is that Turkey will be much more negatively affected.

Turkey is a country with a saving deficit that is in serious need for export and foreign capital to grow. In addition, we are facing a period in which countries like us will face difficulties due to the interest rate hike and monetary tapering of the U.S. Federal Reserve even though these decisions seem to have been delayed because of U.S. President Donald Trump.

In a situation like this, imagine trade with the EU being hindered. What happens if the concerns of banks and financial institutions that can be influenced by Germany were to increase? Imagine the timidity of other Western countries that are expected to bring capital flow to Turkey if they were to follow the footsteps of Germany. 

One wishes politics did not interfere in economic relations. But that is often not the case.