Turkey will emerge stronger from lira crisis despite row with United States: minister

17 August, 2018, 06:55 | Author: Billie Castillo
  • Turkish President Recep Tayyip Erdogan has repeatedly described the dispute with the US with as an

Turkey invited the U.S.to a panel in the World Trade Organization (WTO) about doubling tariffs on steel and aluminum imports, Turkish Trade Minister Ruhsar Pekcan said on Wednesday.

Turkish Finance Minister Berat Albayrak hosted a conference call with global investors on Thursday in a bid to reassure them that policymakers are able to tackle a dip in the Turkish lira.

The Eurasian country's president, Recep Tayyip Erdogan, announced on Tuesday that he would be calling for a boycott of all American electronics sold to the country's residents.

Washington and Ankara are also at odds over Turkey's planned purchase of Russian S-400 air defense systems, to the point where the 2019 United States military funding bill blocks deliveries of F-35 fighter jets to Turkey. The decree also doubled tariffs on American cosmetics, rice, and coal, among other imports.

Berat Albayrak, who has faced criticism for failing to tackle the country's growing financial crisis, spoke to around 6,000 investors on a conference call to rebuff concerns that a funding squeeze on Turkey's banks and a damaging trade war with the United States would force him to seek a rescue bailout from the International Monetary Fund (IMF).

Before he spoke, the lira strengthened more than 3 percent, despite signs that the dispute with the United States is as wide as ever.

Treasury Secretary Steven Mnuchin said additional USA sanctions are ready if Turkey refuses to release an American pastor whom the Trump administration says is illegally detained.

Three big companies operating in Dogubank, a trade center specialized in the sales of electronic products in central Istanbul, suspended 50 million USA dollars' worth of iPhone orders, the Turkish daily said. Turkey's sovereign dollar bonds extended their gains.

Kremlin reveals Putin-Merkel talks agenda
Merkel told Putin in May the pipeline should go ahead, but that Moscow has to commit to maintaining some gas transit via Ukraine.

The Turkish lira continued to rebound from record losses on Thursday a day after Qatar pledged $15 billion in investments to help Turkey's economy.

When Kilic sought to tie conditions to Brunson's release, Bolton waved them aside and said there would be no negotiations.

But Albayrak, who was appointed last month in a largely unexpected move, will have a tough time restoring order to an economy plagued by high inflation and a current account imbalance.

Sheikh Tamim is the first foreign head of state to visit Turkey since the stand-off between Ankara and Washington started last week.

Economists gave Albayrak's comments a qualified welcome, and praised his ambition to get inflation down into single figures next year from above 15 percent now.

"No one has an interest in the economic destabilization of Turkey", Merkel said in Berlin this week. "He said capital controls weren't part of the agenda, and never will be".

Trump has used trade tariffs in a series of disputes ranging from with Turkey and China to the European Union.

"When the dollar turned in the second quarter we had a really weak EM market", Said Haidar, founder and chief investment officer, at NY hedge fund Haidar Capital Management, said.

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