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Turkey’s fiscal structure is strong enough to survive financial pressures caused by political considerations, according to Lebanese economy experts.
In a discussion with Anadolu Agency on Wednesday, several Lebanese economy experts evaluated the recent speculative attack on Turkey’s lira and its possible consequences.
Mohammed Shuayr, chairman of the Lebanese Union of Commercial Chambers, said it was difficult to shake the Turkish economy thanks to its high export potential and dynamic tourism sector.
“I've been following developments in Turkey closely,” he said. “Recent fluctuations in the lira’s value won’t affect the wider economy.”
Investment guru Marc Faber has said U.S. President Donald Trump is acting “like the elephant in porcelain shop”.Turkish assets provide investment opportunity to investors from around the world, Faber, the editor and publisher of the Gloom, Boom Doom Report, told Anadolu Agency.Criticizing American foreign policy, Faber in a phone interview on Wednesday said: “Trump doesn’t pursue foreign diplomacy. He is just like an elephant in a porcelain shop. He picks on this, picks on that, but there is no diplomacy at all.”Turkish finance minister to meet foreign investorsPointing out that Turkey has some leverage regarding the recent tension between the U.S. and Turkey, Faber added: “This is the Trump card that Turkey have, NATO. NATO has significant bases in Turkey. In the long run basically Turkey has two options; it can be closer to Europe and stay in NATO, or it could join the Shanghai cooperation.”“That would imply that Turkey abandoned or have less relationships with the West and more relationships with Russia and China. This is a possibility that Mr. Erdogan has. I think Trump, doesn’t realize that this option is very realistic.”Faber also noted that Turkish assets might well present a good investment opportunity at the moment.New world currency will topple dollar: Russian deputy“People always say they would like to buy low and sell high. Turkish stocks are valued in U.S. dollars. Now it’s in buying range. I think I will buy some Turkish stocks, ETF’s [Exchange Traded Funds]. I own some [Turkish] bonds. It’s not the huge portion of my portfolio but yes I own some Turkish debts. I think it’s the time to buy Turkish assets," Faber added.On the other hand, in order to avoid further volatility, Turkey’s economy should narrow down it’s trade deficit and current account deficit.The famous investor also noted that Trump’s trade war might cause a bigger headache for the global economy in the future.Turkey's doubling tariffs on US products will amount to $533 mln“Trump is surrounded by number of economists and they think that American trade deficit [is] relative, relative decline of American labour force is due to import China. The import from China is symptoms of having become less competitive. Capital spending in U.S. has been low for 20-30 years. Economists have always argued to boost consumption in order to stimulate the economy. Obviously, one of the consequences of this is the growing trade deficit.”Known with his predictions and also called as Mr. Doom in finance world, Faber said: “Trade war is crazy, completely crazy. It is occurring now at this time when the global economy is slowing down. If you look at the price of copper, price of lumber, they already collapsed that is a sign that the global economy is weakening very rapidly. I think we are going go into a recession.”Turkey doesn't want economic war with US, but wont stay silent: presidential aide
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Turkish history, he went on to point out, was full of such economic hiccups.
“It may take time for the lira to recover, but I'm sure the [Turkish] authorities will do whatever is necessary to resolve the problem,” Shuayr said.
Under the leadership of President Recep Tayyip Erdogan, he added, Turkey’s economy had seen significant improvement and diversification.
“The Turkish economy cannot collapse,” he asserted. “The overall consistency of the country’s economic sectors has shown this.”
The alliance forged between Ankara and Moscow is not directed at other countries, Russian Foreign Ministry spokesperson Maria Zakharova said Wednesday."As we have emphasized on every level, Russia is not friends with somebody [to be] against somebody else," Zakharova said."For example, Russian collaboration with Turkey is not directed at third countries."New world currency will topple dollar: Russian deputyHer comments followed a controversial statement issued by the Greek Foreign Ministry claiming that Russia was a “comrade in arms with Turkey.”“Since it began fighting as a comrade in arms with Turkey, providing it with a number of facilitations in the security sector, it appears to be steadily distancing itself from positions befitting the level of friendship and cooperation that has characterized Greek-Russian relations for the past 190 years,” the statement read.Relations between Greece and Russia have recently deteriorated. Russia said on Monday it had summoned Greece's ambassador to Moscow and told him it was responding in kind to what it called an unfriendly decision by Athens to expel two Russian diplomats.Greece said in July it had expelled two Russian diplomats and barred two other people from entering the country for trying to bribe officials and foment demonstrations to thwart a deal to allow Macedonia to join NATO. Russia flatly denied the allegations.Russia says dollar's days numbered as global trade currencyRussian foreign minister arrives in Turkish capital
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Growth
Lebanese economy analyst Ghazi Vazna, for his part, pointed out that Turkey’s economy had sustained a growth rate of between 5 and 7 percent during the period from 2001 to 2017.
“Along with a decrease in inflation rates,” he said, “this period saw the launch of several major initiatives in different sectors of the economy, especially tourism.”
“Today,” Vazna added, “Turkey is one of the region’s leading tourist destinations, hosting more than 32 million tourists per year, which means an annual revenue of some $26 billion.”
According to the analyst, Turkey’s real-estate and banking sectors have also enjoyed considerable growth in recent years.
“With its strategic location in the region,” he said, “the Turkish banking sector has only grown stronger.”
Turkish Treasury and Finance Minister Berat Albayrak is to meet with foreign investors via teleconference on Thursday.The minister will relay his message about the current development of the Turkey economy directly to investors from around the world, the ministry told Anadolu Agency.While the teleconference was expected to be attended by 750 to 1,000 participants, namely from the U.S., the Europe and the Middle East, so far, over 3,000 have registered.This number is expected to increase until Thursday's address..The teleconference is to begin at 4.00 p.m. local time in Turkey (1400GMT) or 9.00 a.m. local time in New York.US dollar has lost its credibility: Turkish FinMinErdoğan says Turkey will boycott US electronic productsTurkey's doubling tariffs on US products will amount to $533 mlnBusiness community backs Turkish economy
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'Positive'
Vazna attributed recent fluctuations in the Turkish lira’s value against the dollar to foreign speculative attacks and political tensions with the U.S.
“The Turkish authorities may not be able to stabilize the currency, but they can ease the problem by pursuing sound domestic monetary policies,” he said.
“This can be achieved by raising interest rates and providing banks with adequate liquidity,” he added.
Recommending that Turkey strengthen its economic relations with the BRICS group of nations (Brazil, Russia, India, China, South Africa), Vazna went on to note that Turkey’s annual trade volume with Russia currently stood at a whopping $17 billion.
The use of the U.S. dollar to put pressure on other countries will lead to the creation of an alternative world currency, costing the dollar its world currency status, a top Russian deputy told Anadolu Agency on Wednesday.Anatoly Aksakov, who heads the Russian State Duma Financial Committee, said the dollar gained its "world currency" status in 1944 when, because of World War II, the national currencies of many countries were devalued while the dollar stayed stable. This resulted in more payments in dollars and its domination in international transactions."But today the U.S. administration is doing everything for the creation of a new world currency,” he said.“More and more countries are considering transactions in national currencies. Meanwhile, the BRICS countries, which Turkey seems to be interested in joining, are discussing the possibility of creating a new currency for payments within the BRICS," he said, referring to the bloc of Brazil, Russia, India, China, and South Africa.Turkey's doubling tariffs on US products will amount to $533 mln: Trade MinisterThe deputy said a BRICS currency would have good prospects, because the bloc possesses half of the world population, 30 percent of the world's industry, and 40 percent of the world's agriculture as well as the biggest natural resources deposits."The process of creating an alternative world currency can be completed within five years. It will depend on Washington, as the more the U.S. uses the dollar to exert pressure, the more motivation other countries will have to deny payments in the dollar," he said.Many countries have already refused the dollar, said Aksakov, citing how China has started buying oil using its yuan, Turkey has withdrawn its gold deposits from the U.S., and Russia has significantly decreased its investments in U.S. government debt.Turkey doesn't want economic war with US, but wont stay silent: presidential aide"Once the alternative world currency appears, the dollar will lose its significance, costing it half its current value. And with the loss of the dollar's value, the U.S. will lose its influence", he said.Currently, the U.S. gross domestic product is some $20 trillion, including $5 trillion in real income, with $15 trillion coming from other countries using the dollar, he said, saying we should consider what losing that $15 trillion would cost the U.S.Separately, Leonid Slutsky, head of the State Duma's Foreign Affairs Committee, told Anadolu Agency that Russia is standing by Turkey in a difficult situation.Turkey's budget records $237 million surplus in July"We are here, with our Turkish friends. We're glad to see that lira has started to recover from the first shock," he said."Russia got a similar shock when the ruble's value fell sharply in 2014. But it's not the end of days."Turkey has all the necessary resources -- political will, intellectual power -- to deal with this challenge. Turkey is not a country that can be suppressed by attacking its national value."Turkish court rejects US pastor’s appeal for release for second time
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“Turkey can also work to forge strong economic ties with China, which represents the world’s second largest economy,” he said.
While Turkey’s initial response to the currency fluctuations has been “positive”, Vazna added, it still must take steps to reassure skittish investors and international markets.
Turkey and the U.S. are currently experiencing rocky relations when Washington imposed sanctions on Turkey’s interior and justice ministers in response to Ankara’s refusal to release an American pastor who faces terrorism-related charges in Turkey.
Last Friday, U.S. President Donald Trump upped the ante by doubling U.S. tariffs on Turkish aluminum and steel imports.
In response, Turkey raised tariffs on several U.S.-made goods, including alcohol and tobacco products and vehicles.
Turkey will never avoid protecting Turkish firms from unfair treatment by the U.S., Trade Minister Ruhsar Pekcan said Wednesday.Speaking at the Turkey-Africa trade and economic relations consultation meeting in capital Ankara, Pekcan said Turkey will continue to take necessary steps to counter the U.S. moves."We have doubled tariffs on 22 products coming from the U.S., responding to the recent U.S. sanctions with additional tariffs worth $533 million last night," the minister said. Group of Turkish NGOs voices support for governmentThe U.S. is an important trading partner of Turkey but it is not the only one; our country has several partners and alternative markets, Pekcan said.American President Donald Trump announced on Aug. 10 the U.S. was doubling aluminium and steel import tariffs on Turkey, fixing them at 20 percent and 50 percent, respectively.Turkey has increased tariffs on several U.S.-origin products, including alcohol and tobacco products and cars, according to a new presidential decree published early Wednesday in the official gazette.Turkey doesn't want economic war with US, but wont stay silent: presidential aidePekcan added trade and economy should not be affected by political reactions.She called for economic cooperations instead of a world with trade wars.She said increasing Turkish investments in Africa remains one of the priorities for the government."We see great potential in this field. We will continue our joint works on increasing economic prosperity and employment," Pekcan said.The Turkey-Africa Economic and Business Forum will be held in Istanbul on Oct. 10-11.Business community backs Turkish economyTurkish court rejects US pastor’s appeal for release for second time
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