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Rudaw

Turkey

Turkey ushers 'new economic model' as lira plummets to Trump's delight

By Rudaw 10/8/2018
US President Donald Trump (center) speaks with Turkish counterpart Recep Tayyip Erdogan (right) and his spokesperson Ibrahim Kalin on July 10, 2018, in Brussels, Belgium. Photo: Benoit Doppagne | AFP
US President Donald Trump (center) speaks with Turkish counterpart Recep Tayyip Erdogan (right) and his spokesperson Ibrahim Kalin on July 10, 2018, in Brussels, Belgium. Photo: Benoit Doppagne | AFP
ERBIL, Kurdistan Region — Turkey is announcing massive reforms on Friday in an attempt to throw a life jacket to its drowning economy. Its president has called the situation a “trade war,” while the United States announced high tariffs on Turkish aluminum and steel.

Turkish Finance Minister Bakan Albayrak described the system as a "new economic model," reported state-run Anadolu Agency from Dolmbahce Palace in Istanbul.

"Another of our principles is to provide full independence in monetary policies, added Albayrak.

Economic reforms are necessitated as the Turkish lira struck a 15-year low against the US dollar. Friday afternoon, 6.61 lira equaled $1, compared to 5.55 on Thursday. Five years ago about 2 lira equaled $1.

President Recep Tayyip Erdogan says Turkey is facing "an economic trade war."

"If you have dollars, euros or gold under your pillow, go to banks to exchange them for Turkish lira. It is a national fight," Erdogan said on national TV, AFP has reported.

US-imposed sanction on Iran could affect Turkish markets, especially its energy sector. Ankara depends on Tehran for much of its natural gas.

US sanctions against two Turkish ministers had little impact and were more directed at the release of US Pastor Andrew Brunson. However on Friday, US President Donald Trump announced massive tariffs on steel and aluminum imports.

"I have just authorized a doubling of Tariffs on Steel and Aluminum with respect to Turkey as their currency, the Turkish Lira, slides rapidly downward against our very strong Dollar! Aluminum will now be 20% and Steel 50%," tweeted Trump.


"Our relations with Turkey are not good at this time!" added Trump


Earlier in the day, Erdogan blamed the economic woes on an "interest rate lobby" seeking to push the country to higher rates. He dismissed the sanctions, saying the Turkish nation has Allah on its side.


"This will be the response to those who have declared an economic war," he said.

 

Turkey's state-run Daily Sabah reported Erdogan and Russian President Vladimir Putin held a telephone call on Friday to discuss the situation and regional issues including Syria. The countries' foreign ministers also spoke, according to Turkey.

 

Responding to Trump's announcement, Turkey says it does not take the president's tweet seriously and his tariffs are in violation of World Trade Organization rules.

Turkish Foreign Affairs Spokesperson Hami Aksoy said "sanctions and repression" will not achieve anything, but only harm the allies' relationship.

He vowed that Turkey would give a "necessary response."

Aksoy urged diplomacy, dialogue, and mutual understanding to resolve the issues. 



Last updated at  10:04 p.m.

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Mohamedzzz | 10/8/2018
US can't win this war because Turkey have Mahoma, its People and God.
RealityCheck | 10/8/2018
We all know that sooner or later you will drop your pants and bend over for Uncle Sam, not only can they devastate your economy but they can also start aiding PKK. That's what the Russians did and and it didn't take a year befor you ran to Moscow and kissed Putens hand. The Americans know this.
Andrew | 10/8/2018
It should be 1000 or 10000 lira to the USD !!! Here comes Princess Erdogan's unveiling of his true self as an Radical Islamist Supremacist slowly moving himself/Turkey towards re-establishing the Ottoman Empire & installing himself as the new Emperor!! My question for all Turkish people is if you take all of Erdogan's actions, decisions, plans, vision, motives, personal history & background then take him at his word he believes and wants a Democratic Turkey to remain, while lieing to, playing games with, using, verbally attacking/ insulting Nations you are supposedly friendly with and above all Allied by treaty militarily.. Do you all truly believe this man and his Government & agree with what I listed above??? If so Turkey needs suspended from NATO & Erdogan his family, inner circle, & his Government need to be black listed & heavily sanctioned!! Then if it happens to be the case a majority of Turkish citizens do not support this Govt or Erdogan, NATO & the West need to help our friends free themselves from this tyranny & oppression!!!
SAM | 10/8/2018
He can at least mess with US and reform its economy to not rely become more indipendent. KRG is bankrupt and now have to beg for international aid and Bagdad to pay its salaries and Peshmerga which fled from every battle. If Bagdad and International aid stop KRG can not even pay its own civil servants. If Turkey closes the border KRG is dead.
Peleng | 11/8/2018
The Russians will take full adavantage of this situation and help Assad drive Turkey out of Syria, Erdogan is no postion to complain because now the Russians hold the key to Turkey's economy, which even with Russian help will barely survive, the alternative is total collapse.

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