Trump says he’ll lift Turkey sanctions, decide on F-35 sales

• Trump confirmed sanctions imposed under the Countering America's Adversaries Through Sanctions Act (CAATSA) will be lifted
• The 2020 sanctions were triggered by Turkey's purchase of Russian S-400 air defense systems, resulting in Turkey's exclusion from the F-35 fighter jet program
• While Trump expressed support for potential F-35 sales to Turkey, legal and congressional hurdles remain unresolved

Summary:

U.S. President Donald Trump announced plans to lift sanctions on Turkey and consider F-35 fighter jet sales during a July 7, 2026 meeting with Turkish President Recep Tayyip Erdogan at the NATO summit in Ankara.

Key Developments:

Trump confirmed the U.S. will remove sanctions imposed under the Countering America's Adversaries Through Sanctions Act (CAATSA). These sanctions were originally enacted in 2020 after Turkey acquired Russian S-400 air defense systems, a move that also resulted in Turkey's removal from the F-35 program—a decision Ankara has repeatedly called unjust and illegal.

Regarding F-35 sales, Trump stated "It's a decision we're going to make," with two sources indicating he is expected to support the potential sale. However, significant legal and congressional obstacles remain unresolved before any transaction can proceed.

Market Implications:

This policy shift represents a major thaw in U.S.-Turkey defense relations and could have substantial implications for defense contractors involved in F-35 production, particularly Lockheed Martin. Turkey's potential re-entry into the F-35 program would expand the aircraft's international customer base and strengthen NATO interoperability.

The lifting of CAATSA sanctions could also improve broader U.S.-Turkey trade relations, which Trump indicated would be discussed during the meeting. This development may positively impact defense sector stocks and signal improved geopolitical stability within NATO, though implementation remains subject to congressional approval and legal processes.

The announcement comes as NATO members focus on collective security, as evidenced by concurrent news of Canada selecting Germany's TKMS for submarine construction.