It is Turks in Germany who will suffer from this squabble

Centuries-old Turkish-German relations started to run into trouble when the German Chancellor Angela Merkel promoted during her election campaign in 2003 the idea of stopping Turkey’s accession process to the EU and giving it a “privileged partnership” status instead of full membership.
Despite this electoral promise, Merkel demonstrated her statesmanship by remaining faithful to an important principle of international law, “Pacta sund servanda” (agreements have to be observed). Turkey’s EU accession negotiations had started before she became chancellor, so she did not block the negotiations, but neither did she withdraw her objection to Turkey’s full membership.
She played a crucial role in striking an agreement on March 18, 2016, to stem the flow of Syrian refugees toward the EU countries. 
While bilateral relations were stumbling over minor issues, a step taken by the German parliament, the Bundestag, to recognize the so-called Armenian genocide caused more lasting damage. 
Turkey reciprocated by not allowing members of the Bundestag to visit German soldiers serving at Turkey’s Incirlik military base in the fight against Daesh. Germany decided to withdraw the soldiers from Turkey and re-deploy them in Jordan. The escalation continued in March 2017, ahead of the constitutional referendum to be held in Turkey on April 16, when German authorities refused to allow members of the ruling Justice and Development Party (AKP) to hold rallies in German cities where there are sizeable Turkish voters. 
A German journalist of Turkish origin was imprisoned in Turkey this year on terror charges. This was followed, on July 21, by the arrest of a German human rights activist. German Foreign Minister Sigmar Gabriel interrupted his holiday to discuss with his colleagues the measures to be taken against Turkey. He started by issuing new travel advice for Germans traveling to Turkey. It stopped short of advising Germans against all travel to Turkey, but warned that “Germans have been detained in Turkey for reasons that are incomprehensible and consular access has been denied in contravention of international obligations.”
On Aug. 19, another German citizen of Turkish origin, Dogan Akhanli, was arrested in Spain upon Turkey’s request to Interpol. Germany asked Spain not to extradite Akhanli to Turkey.
Merkel has been careful not to enter into direct collision with the Turkish president, Recip Tayyep Erdogan, especially in order to safeguard the refugee deal she spearheaded, but she decided to join the other political parties in voicing her discontent with Turkey in the run-up to the German elections later this month.
Gabriel wanted to introduce economic measures against Turkey, saying that he “cannot advise companies to invest in a country without legal certainty where even completely innocent companies are judged as being close to terrorists.”
The approaching German elections made the Turkey issue an instrument to gain support from anti-Erdogan quarters, for example Cem Ozdemir, a German politician of Turkish origin, co-chairman of the Green Party and prime ministerial candidate in Germany. He called for a ban on Turkish teachers in German schools. 
Erdogan retorted by urging Turks living in Germany not to vote for political parties that attack Turkey. He referred to the CDU/CSU and SPD together with the Greens as “enemies of Turkey,” and added: “I think Turkish voters should teach a lesson to those political parties that are so aggressive and disrespectful toward Turkey.”
Merkel did not hesitate to respond in kind. Germany, she said “will not allow any kind of interference in the election and will not let anyone, including president Erdogan, influence the right of German citizens, whatever their origin, to vote freely.” Gabriel followed suit and said: “Berlin will not tolerate any Turkish meddling in German politics.”
The escalation continued when Erdogan, addressing Gabriel, said: “Who are you to speak to Turkey’s president? Know your place! What is your experience in politics? How old are you?” 
There are signs that the German government is considering asking the European Investment Bank not to issue any further credits to Turkey. So far Turkey has received about €25 billion in credits, mainly to the municipalities. 
If implemented, these are serious threats to Turkish-German relations. Germany is a major trade partner of Turkey. Bilateral trade volume amounts to $35 billion, and 6,400 German companies are active in Turkey. There are about 100,000 Turkish-German businesses in Germany, employing about 500,000 people. 
If relations continue to worsen, there will be considerable economic losses for both sides, but the effects on Turkey’s economy will be more damaging because the German economy is much bigger. Economic losses could be made up one way or another, but the biggest losers will be the Turks in Germany, since they may be deprived of innumerable benefits they enjoy at present.