On November 20, U.S. President Donald Trump released a statement regarding the murder of Jamal Khashoggi. In this statement, Trump defended the Saudi Crown Prince Mohammad bin Salman (MBS) amid increasing evidences of his direct involvement in the murder. To an extent, it was so obvious that Senator Bob Corker commented on it by saying he never thought he’d “see the day a White House would moonlight as a public relations firm for the Crown Prince of Saudi Arabia.”

Moreover, Trump carried some of the Saudi official claims against Khashoggi. “Representatives of Saudi Arabia say that Jamal Khashoggi was an enemy of the state and a member of the Muslim Brotherhood,” the U.S. President said. Adding “but my decision is in no way based on that.” Trump tried to cast doubt on the Crown Prince’s role in Khashoggi’s murder by saying “maybe he did –know- and maybe he didn’t!”

In order to justify his position, the U.S. President diluted his blunt defense of MbS by referring to the vast economic and strategic interests tying his country to Saudi Arabia. However, as usual, Trump stuffed his statement with inaccurate information and false facts about Saudi Arabia to support his stance. Here are four myths he presented in his statement.

Trump has gone so far in protecting Crown Prince Mohammad bin Salman that Senator Bob Corker stated he never thought he’d “see the day a White House would moonlight as a public relations firm for the Crown Prince of Saudi Arabia.”

Myth No. 1:

“The Kingdom agreed to spend and invest $450 billion in the United States. This is a record amount of money…..Of the $450 billion, $110 billion will be spent on the purchase of military equipment.”

This is probably Trump’s favorite myth on Saudi Arabia. The U.S. President keeps repeating it every time when the wisdom of his policies towards Saudi Arabia is questioned. Despite previously referring to it many times, no one knows where the number $450 billion has emerged from. It was not officially mentioned neither during Trump’s visit to the Kingdom in May 2017, nor during MbS’s visit to the U.S. in March 2018.

There were previous mentions for opportunities worth $400 billion, but those were only verbal promises over a long period of time. These promises are not expected to be materialized anytime soon if at all. In fact, according to official numbers cited by the U.S. State Department in October 2018, out of the $110 billion Trump always boost in military purchases, Saudis only spent $14.5 billion on defense contracts with US since Trump took office.

Assuming that they will continue on this rate, which is almost impossible, Saudis need at least one and half decade to fulfill their $110 billion promise to Trump. In line with this, Former CIA officer Bruce Riedel, a researcher at the Brookings Institution in Washington, said the $110 billion was fake news then and it’s still fake news today.

President Trump keeps quoting a $450 billion Saudi investment in the U.S. when there’s no such thing. Why does he always use the same figure when lying? 

Myth No. 2:

“It will create hundreds of thousands of jobs, tremendous economic development, and much additional wealth for the United States.” 

No, the promised numbers are not going to create hundreds of thousands of jobs in the U.S. even if we assumed that they will be materialized anytime soon, which is impossible anyway. Last October, Trump claimed the – “non-existing”- $450 billion deals with Saudi Arabia will generate over a million jobs in the U.S.! He also boosted that the $110 billion military package will generate hundreds of thousands of jobs.

Last month, Reuters published a report which refutes this claim thoroughly. The report concludes that the “500,000 jobs Trump keeps bringing up is at least three to five times higher than what one could expect from the Saudi deal, given the estimates from the companies themselves, plus the most generous use of the indirect multiplier.”

Moreover, another report published by the Center for International Policy, a Washington think tank, says Saudi arms sales account for fewer than 20,000 U.S. jobs a year—less than one-twentieth of the employment boost Trump has claimed.

Myth No. 3:

“If we foolishly cancel these –defense- contracts, Russia and China would be the enormous beneficiaries – and very happy to acquire all of this newfound business. It would be a wonderful gift to them directly from the United States!”

No, this isn’t true either. When it comes to its military strength, advanced weapons, and weapon systems, Riyadh heavily dependent on Washington. The vast majority of the Saudi military hardware comes from the U.S., the rest comes from EU and a tiny fraction from China and maybe from Russia.

In this sense, even if we hypothetically assume that Saudis will drop all their military deals with the U.S., China and Russia can’t be an alternative especially when it comes to the most advanced weapons. Ignoring this fact again, depending on Russia and China means that Saudis will have to transform their military in order to be able to acquire and employ military hardware from these countries. 

Such a process is time consuming and probably beyond even the Kingdom’s financial capacity, it will take more than a decade of time at least, and will cost them a fortune. Even if they managed to do so, which I highly doubt, the results will not be impressive at all. Saudis will be weaker, their military strength will be reduced, and they will be much more vulnerable without a global guarantor for their security. In other words, you can sanction them and they will still come to you because they have no other options. 

If the U.S. cancel their defense contracts with Saudi Arabia this will not benefit Russia and China. It’ll just reduce the Kingdom’s military capacity. 

Myth No. 4:

“Saudi Arabia is a great ally in our very important fight against Iran.”

The Iranian regime is not invincible, however making use of others’ mistakes and employing their wrong policies to its benefit have been one of its best features during the last decades. In this sense, if there is one reason why Iran is regionally expanding and increasing its influence, it is because of the Saudi incompetence and Riyadh’s conflicting and chaotic polices to counter Iran. Such Saudi policies increased notably since the rise of Muhammad bin Salam to power in the Kingdom.

In order to effectively counter Iran in the region, you need to achieve a few basic things: Cutting it off from the regional public support which usually boosts its stance; depriving its regional role from the needed legitimacy by standing for everything the public represents such as the Palestinian issue, Syria etc., and finally countering its economic and military activities by making sure that collective regional efforts are contributing to this aim.

However, while stressing the need to counter Iran, MbS undermined every single aspect of any useful regional strategy to fight against Tehran. Working with the advice of his mentor, the de facto ruler of UAE, Crown Prince Mohammad bin Zayed (MBZ), MbS prioritized an absurd war with the so called political Islam, imposed a blockade on Qatar, antagonized Turkey, initiated political and diplomatic crisis with traditional allies such as the Lebanese Prime Minister, King of Jordan, the Palestinian President, the Yemeni President. His reckless, dangerous policies further destabilized the region and boosted Iran’s regional position in an unprecedented way.

Moreover, by creating a deep rift in the GCC bloc, Arab bloc, and between some Arab countries and Turkey, the Saudi Crown Prince made any regional collective efforts to counter Iran almost impossible and provided Tehran with precious cards not only to unlock its regional isolation but also to be in a better position to utilize the regional contradictions to its benefit.

There is no strategic value in such a partner in the fight against Iran. On contrary, the Crown Prince used the issue as an excuse to consolidate his powers internally and externally. Taking all this into consideration, Saudi Arabia under MbS became nothing but a heavy burden on the U.S. and the allies especially in the fight against Iran.

It seems that the dispute over a detained U.S. pastor between Turkey and the U.S. has triggered new dynamics in Turkey’s relations with leading EU states, above all with Germany. As Burhanettin Duran recently addressed, “The Trump administration’s policy of economic selfishness … encourages the world’s leading economies to work more closely together. The U.S. decision to weaponize the dollar and customs compels them to form a common line of defense in international trade. … At the end of the day, the Russian, Chinese, German or French support for Turkey in the face of U.S. sanctions wasn’t just about the potential problems that they would face if the Turkish economy suffers a crisis.”

By looking at the last week, it wouldn’t be wrong to say that reactions from German officials were in compliance with these statements. For instance, members of Germany’s coalition government made some positive comments regarding Turkey-Germany relations in order to stress the country’s stance with regard to Trump’s irrational sanctioning steps against Turkey. In addition, Turkey’s President Recep Tayyip Erdogan and Germany’s Chancellor Angela Merkel had a telephone call in which both leaders discussed the current developments as well as regional issues, such as the situation in Syria. While the Turkish and German leaders pledged their determination to strengthen relations between the two states, some details regarding President Erdogan’s planned visit to Berlin in September were also addressed.

Even before the phone call, Chancellor Merkel clearly stated that “Nobody has an interest in an economic destabilization in Turkey” while adding that “Germany would like to see an economically prosperous Turkey. This is in our interest.” It has also to be mentioned that Germany’s Economy Minister Peter Altmaier (CDU), who is one of the closest politicians to Chancellor Merkel, was one of the first European officials opposing Trump’s tariff policy on Turkey. Altmaier explained, “This trade war slows down and destroys economic growth and produces new uncertainties.” While Altmaier also emphasized that Germany is willing to keep good economic relations with Turkey he stated, “Turkey stands for security and reliability in Europe. We are working together well with Ankara in terms of migration.”

A similar positive step came from the junior coalition partner, the Social Democrats. Besides Foreign Minister Heiko Maas (SPD), the party’s chairperson Andrea Nahles stated in an interview on Sunday that Germany could help Turkey should it become necessary. According to Nahles, despite the possibility whether her predictions became true or not, “A situation could arise in which Germany must help Turkey, regardless of the political discrepancies with President Erdogan.” While she also stressed that it is in everyone’s interest that Turkey remains economically stable and that currency turbulence is curtailed, it is also crucial for her to keep up dialogue on all levels with Turkey, which is a member of NATO and part of Europe.

In addition, some publicly funded German media outlets, which are generally and unfortunately known for their biased broadcasting in the case of Turkey, published some news, in which a rather neutral –or even pro-Turkey– media language and stance has been observed — this was surprising but was also an understandable step due to the current political conjuncture. However, many German media outlets, commentators and columnists, on the other hand, still preferred nearly similar arguments, stating that the Turkish economy is in a very bad situation and accusing the country’s President. In most of these articles, a known language regarding Turkey has been preferred. Without going into detail, one might just mention, that those pieces generally include one-side criticisms while disregarding the U.S.’ role and the contextual impacts.

Nevertheless, it seems obvious that despite certain opposition politicians and known media representatives’ biased perspectives, the German government’s recent steps can be elaborated as rational ones in order to achieve some –in particular economic– objectives. This, with no doubt, aims an improvement of relations between Turkey and Germany – on both sides. Thus, under these circumstances it is also no surprise that, for instance, the German government’s Commissioner for Tourism and Parliamentary State Secretary, recently promoted travel to Turkey by stating that “there is no reason not to go on holiday” to Turkey.

It’s obvious that Germany’s federal government does not have any interest in supporting the U.S. President’s sanctions against Turkey. Even though Germany’s recent positive position regarding Turkey is based rather on economic interests and short-term goals, which are also based on President Trump’s personal and similar negative attitudes against Germany, relations between Turkey and German might mutually benefit from this current situation. Above all, in regard to the Turkish President’s planned visit on 28/29 September to Germany, some additional steps in order to intensify the mutual confidence might be advantageous for both countries – also in fields other than economics.

Now that the American people have made their decision, the protectionist approach employed by Trump in the election campaign matters not only for the U.S. but also for the global economy. In this sense, what the world wonders now is to what extent he will deliver on those harsh pledges. Will he continue to be the furious Trump of the campaign or become an even-tempered President when he assumes office? Or will a balance be found in between? To be honest, nobody knows the answer. However, the arguments of interest can be analyzed based on the ongoing situation and the potential risks thereby.The free trade agreements (FTA) that the President-to-be obviously despised during his election campaign would be a good starting point for this purpose. This is because Trump frequently yelled at former U.S. governments for having signed such horrible deals and causing substantial losses for the domestic economy. By the way, whenever he referred to the harms of the FTAs, he actually – consciously or not – pointed to a total of 14 agreements, which constituted 41 percent of the total bilateral trade of the U.S. in 2015. This is not a trivial dynamic, at all!

So, Trump is expected to come down on Mexico in particular, as he has been blaming the southern neighbor in a visibly bad way.

On the other hand, the FTA that Trump levied the toughest war on during the campaign period was admittedly the North American Free Trade Agreement (NAFTA), which was defined by him as “the most horrible trade deal ever.” So, Trump is expected to come down on Mexico in particular, as he has been blaming the southern neighbor in a visibly bad way. From an economic perspective, this can be thought to mainly stem from the relatively competitive advantages of Mexico. It is a well-known fact that there are lucrative incentives for American companies to operate in the neighboring country.

In this sense, the Mexican economy has fair concerns nowadays due to its rather concentrated market structure that is highly dependent on the demand flowing from the U.S. And beyond the bilateral trade relations, the loss of confidence and the uncertainties that have emerged after November 8 pose indirect risks for the country’s economy. However, the fact that the two economies are highly integrated in various sectors complicates the case. This is likewise the situation for Canada, the top destination for U.S. merchandise exports and a critical part of the U.S. supply chain.

At this point, it should be emphasized that based on 2015 data NAFTA accounts for approximately 75 percent of the total bilateral trade of the U.S. within its FTA portfolio. Therefore, it is evident that the U.S. has considerably strong ties with its NAFTA markets. As Canada and Mexico rank within the top three trade partners of the U.S., it will not be an easy job to put a lock on the NAFTA door from a realistic point of view. Yet it is likely that Trump will take an initiative and attempt to fix the disadvantageous terms of the deal for his country. In such a scenario, potential energy collaborations as well as the older-than-NAFTA free trade relationship between the U.S. and Canada might be a factor for tipping the balance.

Moreover, Canada and Mexico are also prospective partners for another trade deal frequently attacked by Trump: the Trans-Pacific Partnership (TPP).  As an integral part of Obama’s Asia Pivot strategy, the TPP attempts to bring 12 economies together and create a strong cooperation in the Asia-Pacific. For the U.S., it was supposed to serve as a tool against China’s increasing dominance in the region. However, Trump claims that the deal is a complicated piece of garbage that would cause losses to the U.S. economy in case it is ratified. Thus, considering also the escalated disapproval regarding the deal, it would not be irrational to expect the new President to scrap it or put it in cold storage at least. Likewise, it is also believed that the Trans-Atlantic Trade and Investment Partnership (TTIP), which is Obama’s economic project on the Atlantic front and an admittedly less mature initiative than the TPP, will probably be slowed down by the President-elect.

On the other hand, a blow to the TPP by Trump will not only deprive the associated parties of the Trans-Pacific collaboration but also will offer an opportunity for China. An American administration that turns its back on the TPP would encourage the Chinese project called the Regional Comprehensive Economic Partnership (RCEP) that aims to gather the Association of Southeast Asian Nations (ASEAN) group and six other big economies in the region under one umbrella.

Nevertheless, China also has concerns related to the new U.S. president, as it is a country frequently disparaged by him in the election period.

Nevertheless, China also has concerns related to the new U.S. president, as it is a country frequently disparaged by him in the election period. In 2015, China was the third largest single-country destination for U.S. merchandise exports while it ranked the first source for U.S. imports. While the bilateral trade between the two partners is quite robust, the merchandise trade deficit with China is known to infuriate Donald Trump. In that regard, he has vowed to declare China a currency manipulator and slap punitive duties on Chinese imports. The two countries are also known to have long-standing problems including the failure of China to respect U.S. intellectual and property rights.

Yet it is uncertain if Trump would overstep the mark and provoke China into a tit-for-tat retaliation. While the jurisdiction of the U.S. Congress will play a critical role at that point, an aggressive scenario could end up with the violation of the World Trade Organization (WTO) rules for both parties and endanger the order of the global economy as well.

To be sure, Trump is not the first U.S. presidential candidate who fed his campaign with a nationalist trade agenda.

To be sure, Trump is not the first U.S. presidential candidate who fed his campaign with a nationalist trade agenda. Yet even the uncertainties he has created so far have been enough to scare the global markets. The trade liberalization process started after World War II with the General Agreement on Tariffs and Trade and reinforced with the creation of the WTO, now seems to face the risk of losing support from its pioneering country. So, in an era where trade faces stubborn challenges, the new U.S. President’s isolationist pledges draw a grey picture for the world economy and shake economic confidence.

This addresses certain implications for emerging economies, in particular. Beyond countries such as Mexico and China, which are directly associated with Trump’s promises, those who look forward to a recovering world trade encounter some indirect risks. Turkey is one of those countries, as well. Moreover, projections on the future outlook of the U.S. economy inarguably augment the relevant risks. The sharp moves in the Turkish markets observed after November 8 indicate the significance of the matter. On the other hand, apart from the aforementioned global uncertainties caused by the U.S. election results, Trump’s relationships with the EU, Russia and Iran are also likely to produce complicated economic effects for Turkey in positive or negative ways. Everything depends on the extent to which he will deliver on his unconventionally sharp pledges. That is why the first half of 2017 will be a critical period for the actors of the world economy to figure out how the new U.S. administration will lead the way.