Apr 18 2019

Erdoğan says Turkey under attack by FT, Western media

Turkish President Recep Tayyip Erdoğan said the country is under attack from the Financial Times and other Western media.

The foreign press outlets are falsely making out that Turkey’s economy is “collapsed, finished,” Erdoğan said in televised comments in Ankara on Thursday.

Erdoğan spoke after the Financial Times reported that Turkey’s central bank was bolstering its foreign currency reserves via short-term borrowing on the swaps market. Net reserves were less than $16 billion excluding the swaps, compared with the $28.1 billion officially stated by the bank for early April, the FT said late on Wednesday.

“Whatever the Financial Times writes, our situation is clear,” Erdoğan said.

Turkey’s lira fell to the lowest since a mini flash-crash in January in Istanbul on Thursday, partly on concern about the foreign exchange reserves. It dropped to as low as 5.846 per dollar, taking losses this year to about 9 percent, before recovering slightly to trade down 1.4 percent at 5.82 per dollar at 1:17 p.m. local time.

Erdoğan’s comments followed similar criticism of the FT, Reuters and Bloomberg early this week. The three news organisations reported last week that a meeting between Treasury and Finance Minister Berat Albayrak, Erdoğan’s son-in-law, and investors in Washington had gone badly. A new plan to strengthen the economy lacked detail, they said.

Investors in Turkey are calling on the government to swiftly implements effective measures to deal with a pile of troubled loans in the banking industry. Some economists are also calling on Erdoğan to sign a new loan accord with the International Monetary Fund to steady the economy, a suggestion he flatly rejects.

Turkey has four years without elections – time in which it will implement economic reforms – after concluding local elections on March 31, Erdoğan said on Thursday.

Turkey’s economy entered a recession in the second half of last year, sparked by a currency crisis. The IMF estimates that it will contract about 2 percent in 2019. The lira slid 28 percent against the dollar last year, pushing inflation to more than 20 percent. It now stands at 19.7 percent.