Tossing out an ambassador, suspending defense ties and boosting Turkey's naval presence in the eastern Mediterranean won't be Prime Minister Recep Tayyip Erdogan's last word in his most recent showdown with Israel.
Erdogan said his government will announce new steps to punish Israel -- not long ago its strongest regional ally -- unless Prime Minister Benjamin Netanyahu apologizes for the killing of nine Turks last year in an Israeli commando raid at sea. Among the moves may be a visit by Erdogan to the Gaza Strip, ruled by the Islamic group Hamas.
"Because of its political aims in the region, Israel has lost Turkey's partnership," the 57-year-old Turkish leader told reporters yesterday in Ankara. "This process will be followed by very different sanctions."
Erdogan's remarks -- his first since the United Nations criticized both countries in a 105-page report last week on the Israeli interception of a Turkish aid ship bound for Gaza -- escalated a feud that has been heating up gradually since 2004.
Turkey suspended military relations with Israel last week and expelled Israel's ambassador over Netanyahu's refusal to apologize. Israel says its soldiers were attacked by activists aboard the Mavi Marmara and released video footage to support the assertion. Passengers say Israeli troops fired first.
"The Turkish government has moved on and made the strategic decision to not partner with Israel," Ilan Berman, vice president of the Washington-based American Foreign Policy Council, said in a telephone interview. "The problem with appearing very strong and very decisive on events like this is when things begin rolling, it's very difficult to walk back the dog."
An Israeli official said the government has made numerous attempts to find a formula to prevent the relationship with Turkey from deteriorating further and will continue to try. The official spoke anonymously, citing the diplomatic sensitivity of the matter.
Erdogan said Turkey will step up naval patrols in the broad region of the Mediterranean where the Mavi Marmara was boarded. He said all military ties, including defense-industry trade, have been suspended and that diplomats in the embassies of both countries above the second-secretary level are being sent home.
The decision on whether to visit Gaza will be made after he arrives in Egypt next week, Erdogan said.
A visit by Erdogan would highlight Israel's continued restrictions against the seaside Palestinian enclave, more than a year after it loosened limits on goods entering the territory under international pressure. Access to Gaza has been eased at its border with Egypt since the overthrow of Egyptian President Hosni Mubarak.
A trip would also coincide with Palestinian efforts to obtain statehood recognition at the UN this month. Israel and the U.S. oppose the Palestinian measure, saying it should only be taken after an agreement is reached in Middle East peace negotiations.
Israel cited security reasons for stopping the import of products including construction materials into Gaza. Hamas and other militant organizations have fired thousands of rockets at Israel over the past decade.
Israel staged a three-week military offensive against Gaza at the end of 2008 that led to the killing of at least 1,100 Palestinians and 13 Israelis. Hamas is considered a terrorist organization by Israel, the U.S. and the European Union.
Relations between Turkey and Israel have been turning steadily sour since Erdogan condemned Israel's March 2004 killing of the Hamas founder, Sheikh Ahmed Yassin, as a terrorist act. Israel was further annoyed when Hamas leaders were received by officials in Ankara after winning the 2006 Palestinian legislative elections.
Erdogan criticized Israel's December 2008 assault on Gaza and left a panel discussion with Israeli President Shimon Peres at the World Economic Forum in Davos, Switzerland, a month later. The relationship has degenerated further since the Mavi Marmara episode.
Credit-default swaps to insure five-year Israeli debt against non-payment have risen by about 10 basis points since Sept. 2, the day Turkey announced it would downgrade ties. The swaps closed at 171 yesterday, according to CMA. Turkey's credit-default swaps closed at 244, up from 190 at the beginning of August.
Trade between Israel and Turkey grew to $1.36 billion in the first six months of 2011 from about $1 billion a year earlier, according to the Central Bureau of Statistics in Jerusalem.
Some of the trade has involved the purchase of arms by Turkey from Elbit Systems Ltd. and state-owned Israel Aerospace Industries Ltd. Among other companies that do business in Turkey are Bank Hapoalim Ltd., Israel's second-biggest bank by assets, and Oil Refineries Ltd., its biggest refiner.