EU downgrades diplomatic ties, funding with Turkey over gas drilling near Cyprus

In the latest escalation over Turkey’s gas drilling activities within disputed offshore territories near Cyprus, EU foreign ministers imposed an initial round of punitive measures on Ankara on Monday evening. The move follows months of increasing tensions, in which the Republic of Cyprus issued arrest warrants for crewmembers aboard Turkish gas exploration ships and Ankara responded by deploying a third ship, expanding its energy development operations off the island’s shores.

The measures include the suspension of high-level diplomatic contact between the EU and Turkey, as well as negotiations on the Comprehensive Air Transport Agreement, which regulates regional commercial flights, and a reduction of pre-EU accession financial aid for Turkey in 2020. EU ministers also prompted the European Investment Bank to review its lending programs in Turkey, which totaled $434 million in 2018.

“The council deplores that, despite the European Union’s repeated calls to cease its illegal activities in the eastern Mediterranean, Turkey continued its drilling operations west of Cyprus and launched a second drilling operation northeast of Cyprus within Cypriot territorial waters,” the foreign ministers said in a statement after passing the measures on Monday.

Markets did not initially respond to the EU measures, and the Turkish lira traded at a steady 5.70 per US dollar throughout the day.

The developments underline growing discord between Turkey and its Western allies on multiple fronts. Ankara faces a separate set of sanctions for its acquisition of Russian S-400 missiles, and its continued gas drilling activities near Cyprus have thrown long-stalled reunification talks on the island into question, disrupting a delicate geopolitical balance in a region where neighboring states are vying to develop yet untapped energy resources.

Responding to the EU measures, Turkish Foreign Minister Mevlut Cavusoglu said he was unfazed by the funding cuts and that Turkey would continue its activities near Cyprus by sending a fourth ship to the Eastern Mediterranean.

“There is no need to take [the measures] very seriously,” Cavusoglu said on Tuesday.

He added, “We have three ships there, God willing we will send a fourth ship to the Eastern Mediterranean as soon as possible. Let them understand that they cannot deal with Turkey with such methods.”

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