Germany wants the European Commission to suspend preparatory work on negotiations with Ankara on modernising the customs union because going ahead with it would send the "wrong signal", Reuters reported on July 31, citing a draft report by the Berlin government.

The draft report, seen by the news service, mentioned a number of other measures “it would like to see implemented at the European level to raise financial pressure on Turkey to respect the rule of law”.

“Given developments in Turkey, pre-accession aid should be targeted even more towards supporting democracy and the rule of law. The European Commission should look into suspending all pre-accession aid to Turkey if the need arises,” the report said.

The German proposal to block further negotiations on the customs union comes at a time when Ankara and Berlin are engaged in an intense war of words. German Foreign Minister Sigmar Gabriel signalled a toughening of Berlin’s policies towards Ankara. He warned German tourists and other German nationals to exercise more caution in traveling to Turkey. "We need our policies towards Turkey to go in a new direction. We can't continue as we have done until now," Gabriel said on July 20.

The customs union agreement between Turkey and the EU came into force in December 1995. The bloc is Turkey’s largest trading partner, absorbing nearly 50% of the country’s exports.

In December 2016, the European Commission proposed to modernise the customs union and to further extend bilateral trade relations to areas such as services, public procurement and sustainable development.

On July 6, the European Parliament adopted a resolution, calling for the suspension of accession talks with Turkey if the government in Ankara implemented constitutional changes approved in the controversial referendum in April, which granted sweeping executive presidency powers to President Recep Tayyip Erdogan.

MEPs supported upgrading the EU-Turkey customs union but asked for human rights and fundamental freedoms to be part of a new agreement.

Turkey is rejecting criticism that it is backsliding on democracy and human rights. The Ankara government maintains that the security measures it has implemented since last year’s coup attempt are necessary. Ankara accuses Europe of failing to show solidarity with Turkey in the wake of the botched putsch.