President Recep Tayyip Erdogan has said Turkiye launched a historic change in economic policy, putting aside the ‘classical understanding’ of controlling inflation with high interest rates.
Turkiye’s President Recep Tayyip Erdogan has said his country’s economic climate will be “completely different” this summer when balance is established in the financial system.
Erdogan called for academics and economists to contribute to the government’s new economic model at a meeting with members of the press and academia in Istanbul on Friday.
Turkiye “has adopted an economic policy based on growing the country with investment, employment, production, exports, and current surplus,” said Erdogan at the meeting at the Presidential Dolmabahce Office.
The foreign exchange reserves of Turkiye’s Central Bank currently stand at over $115 billion, and is expected to be in a much better position, according to Erdogan.
“Today, Turkiye has the infrastructure it needs in every field from education to health, from security to law, from industry to tourism,” he said.
Highlighting that economic indicators showed that the time was right for this new policy, Erdogan said: “We aim to place Turkiye among the 10 largest economies of the world on this strong groundwork.”
The benefits of Turkiye’s new approach will become clear in the next three to six months, he added.
Turkiye’s lira was on track for its strongest week on record on Friday.
The lira eased to 11.7 per dollar – though after having strengthened to 10.25 on Thursday, its strongest level in over a month, following a series of measures by the government and central bank to prop up the currency.
The currency spiked 44 percent after a promise that the government would cover FX losses on certain deposits.
Erdogan unveiled the plan, in which the Treasury and central bank would reimburse losses on converted lira deposits against foreign currencies, on Monday.
The anti-dollarisation plan set off four straight days of gains as Turks converted some $900 million worth of hard currencies into lira, according to Finance Minister Nureddin Nebati.
Nebati, in an interview on broadcaster NTV on Thursday, said Turkiye is “using all the instruments at its disposal in a positive way”.