Turkey’s top business group blasts government for mismanaging economy

A leading official with the Turkish Industry and Business Association (TÜSİAD) on Tuesday blasted the government over the state of the country’s economy, saying the slide in the lira following an abrupt central bank overhaul was worrisome.

TÜSİAD High Advisory Council head Tuncay Özilhan made the remarks during a TÜSİAD meeting held via video-conference, Halk TV reported.

Referring to President Recep Tayyip Erdoğan’s sacking of central bank chief Naci Ağbal and his assistant Murat Çetinkaya earlier this month, Özilhan said the move had plunged the country into uncertainty.

The Turkish lira has dropped about 14 percent against the dollar since the management change at the bank amid concerns among investors on the direction of Turkey’s monetary policy.

“How do you make plans if you don’t know where the country is going tomorrow?”

Özilhan said while referring to unclear “jurisdictions and responsibilities” that are part of sudden overhauls.

“The neo-liberal system is trying to heal its wounds from 2008, but we are also on the verge of another Cold War between China and the United States,’’ Özilhan said.

Özilhan called for problems to be discussed in parliament through dialogue and compromise.

“Turkey needs a stable currency, price stability and lower unemployment,’’ the official said while criticising the economic reform package announced by the government earlier this month aimed at boosting investment, production, jobs, and exports.

“The high interest rates are the result of the savings gap,’’ he said, noting that Turkey should cut expenditures and attract foreign investment.

Inflation in Turkey accelerated to 15.6 percent in February and is expected to nudge upward in March and April, threatening the bank’s year-end goal of 9.4 percent.

“Investors only come to a country that is stable, with financial discipline, not to a country that changes rules in a fortnight,’’ he said.

But Özilhan was not entirely pessimistic as he pointed to change in trade-chains after the pandemic, from which Turkey could profit.

“European firms want to diversity their supply chains, Turkey’s role can become more important,” he said. “But for that to happen, Turkey has to deal with it’s issues.’’