US ambassador to Turkey David Satterfield said on Wednesday companies will consider abandoning Turkish market if it fails to fully meet debt payments to US pharmaceutical firms.
Addressing a trade conference streamed online, Satterfield said debts owed by government hospitals to pharmaceutical companies in the US and elsewhere had risen to around $2.3 billion from some $230 million a year ago.
Satterfield said US Commerce Secretary Wilbur Ross had raised the issue with Turkish President Tayyip Erdogan and Finance Minister Berat Albayrak a year ago and was assured that arrangements would be made for prompt payment.
A year later those companies were being asked to accept significant reductions in the amounts owed, Satterfield said, adding there will be consequences for non-payment of debt or reductions in payment, Reuters reported.
“Companies will consider departing the Turkish market or will reduce exposure to Turkish market. This is not a direction which serves the interests of Turkey,” he said.
Bilateral trade amounted to some $21 billion last year and the NATO allies have said they aim to lift that to $100 billion.
Yet there are hurdles including US tariffs on Turkish steel, and Ankara’s purchase of Russian missile defenses last year that prompted Washington to oust Turkey from a consortium producing F-35 jets.
At Tuesday’s conference hosted by the US-Turkey Business Council, Turkish Trade Minister Ruhsar Pekcan said the steel tariffs and the removal of Turkey from a US trade preference program have damaged efforts to reach the trade goal.
“Such policies by the US severely limit Turkish firms’ ability to enter the US market,” she said.