Turkey Financial CRISIS: Erdogan Facing RECESSION After Trump Imposes Crippling Sanctions

Date & time : Sunday, 17 March 2019

 Laura O’callagan

 

Turkey’s President is facing the country’s worst financial crisis in a decade just months after US President Donald Trump imposed crippling sanctions in the midst of a diplomatic spat.

Recep Tayyip Erdogan’s grip on power will be tested later this month when Turks head to the polls for municipal elections which could see his right-wing party’s grip on the country loosened. A “prolonged period of negative growth” has been predicted after official figures released on Monday showed Turkey’s economy contracted by 2.4 percent in the final quarter of 2018 compared with the previous quarter, which saw it fall 1.6 percent. As his country’s economy tips into recession – defined as two consecutive quarters of negative economic growth – Mr Erdogan’s finance minister blamed the crisis on outside interference.

Andrew Brunson, who was arrested in the wake of the failed coup attempt in 2016, was convicted of terror-related charges after being accused of having links to a banned political movement.

The rift between the two countries prompted Mr Trump to impose devastating sanctions and raise tariffs against Ankara, which caused the lira to plummet against the dollar.

The upcoming elections could result in the loss of some of the country’s biggest cities for Mr Erdogan’s Justice and Development Party (AKP).

Emre Erdogan, a political science professor at Bilgi University in Istanbul, told the Financial Times that he believes the party will suffer “a certain level of decline” in popularity with voters.

Nora Neuteboom, an emerging markets economist at Dutch bank ABN Amro, predicted a “prolonged period of negative growth” and added that the president is “facing totally different challenges to the ones he faced in 2008” when Turkey experienced its last economic crisis.

With just weeks to go, the Turkish finance minister Beat Albayrak sought to reassure voters by saying the worst of the problems are behind them

Mr Albayrak wrote on Twitter: “Despite the most serious speculative attack (on a country) in history, and a period when global growth has started to slow, a situation akin to 2001 and 2008 has not materialised.”

He was referring to the economic turmoil which hit Turkey 10 years ago after the US subprime mortgage crisis and the 2001 banking crisis.

Mr Erdogan’s conservative, Islamic-leaning party came to power in 2002 survived both the unstable economic climates and a failed military coup in 2016.

But now the president is facing a different type of challenge which could spell trouble for his party’s tight grip on the country of nearly 80 million people after it enjoyed 16 years of victories at the ballot box.

 

Source; Express

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