Turkish lira plunges to record low
The Turkish lira plunged to a record low this week and is now trading at around four lira to the euro. Terrorist attacks and the state's indiscriminate actions have prompted investors to withdraw their money from Turkey, analysts say. The government has other problems to deal with right now, some commentators point out. Others pin the blame on a single person.
Uncertainty and arbitrariness rule the day
The fall of the lira is for the most part a homemade problem, the Financial Times writes:
“The lethal spillover from the Syrian conflict has been worsened by Turkey’s initial tolerance of jihadi networks and President Recep Tayyip Erdogan’s decision to sacrifice a chance of peace in the Kurdish south east for electoral gain. A purge of suspected Gulenists following July’s attempted military coup has become indiscriminate. Its effects on business are wide-ranging. Arrests of executives and asset seizures disrupt supply chains; officials hesitate to sign routine documents in case they are later deemed complicit with a Gulenist company; and foreign investors fear their partners may be implicated.”
Government needs to build up trust asap
The Turkish government needs to quickly adopt a package of resolute measures to halt the lira's fall, Milliyet urges:
“The president and prime minister should appoint a member of their team whom they trust as a kind of captain. This captain would be in charge of all economic units. ... On the domestic front it is important to increase the people's trust. Internationally it is important for Turkey to explain that it has good intentions and precisely what it intends to achieve within which time frame with its programme. Once they have put this programme together the captain and his team will have to start canvassing for it in the West. ... Let's be realistic: there is no time for the politicians to deal with the economy in addition to the constitutional reform and the preparations for a referendum. ... And we can't just wait for the terrorism and the Gülen problem or the events in Syria and Iraq to come to an end.”