Turkish Prime Minister Binali Yildirim speaks during a meeting with representatives of German companies, in Ankara, Turkey, July 27, 2017.
Turkish Prime Minister Binali Yildirim speaks during a meeting with representatives of German companies, in Ankara, Turkey, July 27, 2017.

ISTANBUL - The Turkish prime minister has met with executives of leading German businesses operating in Turkey in a bid to allay concerns over German-Turkish tensions.  According to reports a number of German companies are under investigation for alleged links to last year’s failed coup.

Binali Yildirim sat down with executives of German companies in Turkey, bringing the message they have nothing to fear.

Yildirim said the government views the companies as part of the Turkish economy.  He said it is out of the question that German companies could pay a price for the state of relations between Turkey and Germany.

His comments come after Turkish authorities sent a list to Berlin of German companies allegedly implicated in last year’s failed coup to unseat President Recep Tayyip Erdogan.  

Ankara has said the list was sent by mistake and that German companies were not under investigation.

But with nearly a thousand Turkish companies seized in the post-coup crackdown and German nationals also held, business analysts warn there is growing concern among German companies in Turkey.

Global Source Partners political consultant Atilla Yesilada warns Yildirim’s comments may do little to allay concerns.

"I think it is a nice gesture.  But I do not think it is going to alleviate the problems.  And I do not think it is going to end the chill over German and European investments.  Because the story is bigger than the companies themselves.  It's a question of property rights, respect for law, and what kind of guarantees can be given that their employees would not be implicated in some kind of investigation," Yesilada said.

Economic price

Tensions increased after Turkey detained German human rights activist Peter Steudtner earlier this month.  He is one of 10 German nationals held in the crackdown.  Berlin is suspicious the detentions are part of Ankara's effort to pressure Germany to extradite people accused of being involved in the July coup attempt.

Analyst Yesilada says Ankara needs to take concrete steps to increase German business confidence.

"Turkey could at any point release Mr. Steudtner and other names that has so annoyed Germany with their arrests.  But assuming this will not be the case because Mr. Erdogan said, 'We will catch your agents and trample over them'."

But Ankara could pay an economic price for the tensions with its biggest trading partner.

Berlin has warned it could reduce or end credit guarantees for German companies importing from Turkey, which could cost the Turkish economy up to $2 billion a year.  Tourism could also be hit; Berlin has issued a travel warning for Turkey.

The biggest threat, some regional analysts say, is the possibility of Western banks reducing loans the Turkish economy depends on.