Ankara (GPA) – The rising tensions between Ankara and Washington may freeze some big sales for the Turkish defense industry.
turkish defense industry
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The Turkish defense industry, which is heavily entangled within the structure of NATO, has run into some problems in the last few days. This all started after Washington placed sanctions on two Turkish ministers involved in the incarceration of a US pastor last week.

The sanctions – which target Turkey’s Minister of Justice Abdulhamit Gul and Minister of Interior Suleyman Soylu – are in retaliation for the illegal detention of a US pastor who was arrested in the ongoing purges inside of Turkey. According to the Turkish government, the pastor, Andrew Brunson was likely involved in “attempting to subvert the government” in association with the FETO organization of exiled cleric Fethullah Gulen.

Related: US Pastor Jailed in Turkey Claims Innocence Amid Trial Delay

However, Turkey and the US both know these sanctions are really about issues that run much deeper than just the detention of the US pastor (who was originally arrested all the way back in October 2016). Besides Brunson, there are other sources of tension between the US and Turkey including the recent trial of a gold trader accused of breaking US sanctions on Iran with Turkish President Erdogan’s blessing, Erdogan’s recent criticism of Israel, and most importantly, Turkey’s attempt to buy the Russian-made S-400 anti-aircraft system.

Turkey’s attempt to purchase the Russian S-400 systems has been causing problems with the US since the deal was first announced but these problems have gone unaddressed with both sides seemingly hoping the conflict would work itself out. Time is now running out for this option though, as the deadline for the delivery of Turkey’s share of the new F-35.

The US has opposed the transfer of the new fighter (which Turkey makes components for as a member of a 9 nation project)  since the day the S-400 purchase was announced but now there are Turkish pilots training on the jet in Texas and Turkish technicians training on maintenance of the F-35 in Florida.

The problem with giving the F-35 over to Turkey now, according to US officials, is that having the NATO jet running on the same network as Russian anti-air systems would expose specifications of the F-35. This access to sensitive information by the Russians would allegedly leave the F-35 vulnerable or completely useless.

Related: US Official: Turkey S-400 Deal Could ‘Spike the Punch’ in F-35 Deal

Removing Turkey from this project, however, is another story. Since Turkey helps build components for the F-35, if the US decides they can no longer be a party to the project, Washington will have to search for a new manufacturer and Turkey will lose their legal ability to make these parts.

The F-35 and the Turkish Defense industry

If turkey does lose the ability to manufacture some of these components for the F-35, there is another danger in that it could set a precedent. On top of the F-35, Turkey makes a whole host of components and knock-offs of NATO equipment and sells them via export agreements approved by Washington.

One example of this kind of agreement is the parts that go into the construction of the Turkish T129 ATAK helicopter, which Ankara has just agreed to sell 30 of to Pakistan for $1.5 billion. The T129, which is based on the European Agusta A129 Mangusta, has yet to be approved for export by Washington.

The deal to sell the T129s to Pakistan was signed in July and Ankara is running out of time to secure the licenses, with the first delivery scheduled for November. If Turkey fails to deliver the helicopters – or get Pakistan to agree to a deferred delivery – by then, Pakistan is allowed to back out of the contract.

Related: Erdogan’s Win and New Powers Means Turkish Economy is His Burden

If this contract falls through it would not only damage Turkish credibility but also likely hurt the Turkish company behind the deal, Turkish Aerospace Industries (TAI). Erdogan’s Son-in-Law is also on the board at TAI so he has a personal stake in seeing this deal go through for his own fortunes.

The T129 is not the only project the Turkish defense industry, or even TAI, has geared up for the weapons export market in the next few years. Turkey is also set to deliver weapons to other countries such as Qatar and will likely have a new defense contract with the post-Brexit United Kingdom to draw up soon. If Ankara can’t find a way to work through their problems with Washington (and if they’re not willing to violate international law) the rejuvenated Turkish defense industry aimed at exporting budget weapons and equipment may soon take a dive.