On Friday, Turkish assets basked in the glory of the “deal” Recep Tayyip Erdogan struck with Mike Pence and Mike Pompeo, who effectively ceded control over a swath of territory in northeastern Syria on behalf of the Kurds during a trip to Ankara this week.
The Borsa Istanbul 100 jumped some 4%, for one of its best sessions of the year, while the lira surged and Turkish bond yields fell.
The “ceasefire” – touted by Donald Trump as a “great day for civilization” – in fact amounts to a nothing less than a total capitulation to Erdogan, who has given Syrian Kurds five days to evacuate the area he claims as a “safe zone”.
The lira gained more than 1% at one juncture and has rallied strongly off the worst levels hit earlier in the week.
The gains may prove fleeting. Lawmakers are not amused with Trump’s attempt to spin Pence’s agreement with Erdogan as some kind of win-win for America’s Kurdish partners. Nor is anyone on Capitol Hill particularly enamored with the idea that Erdogan will enjoy sanctions relief for doing nothing more than halting the massacre which has claimed the lives of hundreds over the past week.
“President Trump is flailing. The President’s decision to reverse sanctions against Turkey for brutally attacking our Kurdish partners in exchange for a sham ceasefire seriously undermines the credibility of America’s foreign policy and sends a dangerous message to our allies and adversaries alike that our word cannot be trusted”, Nancy Pelosi and Chuck Schumer said in a statement, before delivering the following damning critique:
President Erdogan has given up nothing, and President Trump has given him everything. The Turks have stated that ‘this is not a ceasefire,’ and made clear that they ‘will pause the operation for 120 hours in order for the terrorists to leave’ – referring to the courageous Kurdish fighters who have suffered nearly 11,000 casualties in our fight to defeat ISIS. This agreement also does nothing to stop thousands of ISIS prisoners from escaping, and shows the President’s complete lack of strategy to defeat ISIS. To say that Turkey and Syria will guard the prisoners is outrageous and puts our homeland security at risk. ISIS is still a threat, certainly now more than before President Trump gave Erdogan the green light to invade Syria.
That, unfortunately, is the stark reality of this situation. The president’s critics take great joy in lampooning Trump when the “art of the deal” goes horribly wrong, but this is one time when the hilarity inherent in his wholly laughable attempts at negotiating with another world leader is eclipsed by the human tragedy the White House precipitated.
Lawmakers will press ahead with a punishing sanctions bill that may include a ban on the country’s sovereign debt. “Next week, the House will pass a strong, bipartisan sanctions package to work to reverse the humanitarian disaster that President Trump unleashed in Syria”, Pelosi said.
“Sanctioning sovereign debt would be lights out for Turkey, given it has $180 billion in short-term external debt to finance every year”, BlueBay’s Tim Ash remarked.
As far as what Ankara is thinking right now, the Washington Post cites an official briefed by participants in the meeting between Pence and Erdogan as saying the Turkish side was shocked that things went so well. “We got everything we wanted”, the Turkish official said.
Meanwhile, SANA is now reporting that a Turkish airstrike hit a village in Ras Al-Ain on Friday. Kurdish media said five SDF fighters were killed.