“Turkey is heading to a crisis because of political risks and the government is carrying gasoline to this fire. The president’s remarks brought the tension to a higher level.”
The government broke from the realities of Turkey
After the recent events, Prof. Katircioglu stated that “the government should not base their economical analyses on conspiracy theories. The government seems truly believe that foreign powers are the cause of this situation, while this is not true. Even if their suspicions were true and there is an operation against Turkey, they could easily confront this through the Central Bank tools. But they don’t and can’t.”
The real issue is the political discourse
According to Prof. Katircioglu the real reason for the rise of the currency is the political discourse. The recent discourse doesn’t give much confidence, which frightens the international capital. The government should stop ignoring social communities and imposing their own political identity.
Their only hope is the funding from Arab states
The urge to switch to a presidential system, while there are so many problems and a big economic crisis which is just around the corner, makes the social polarisation even worse. The Professor thinks that the plan is to bring funds from Arab states to Turkey. Saudi Arabia has 700 thousand billion dollars in the USA. Since the recent legislation which will permit US citizens to sue Saudi Arabia there is a tension. If things get worse KSA might take their fund, which could partly be invested in Turkey, the thinking in Ankara goes.
They can’t solve Turkey’s problems this way
Katircioglu, who supports the idea that the situation of the currency is a sign for a crisis said; the inflation will rise. Numbers will hover double digits, will reach well above 10%. The Central bank sold 1,5 billion dollars but this will not solve Turkey’s problem. If the constitutional amendments gets through then a dollar will pass 4 Turkish Liras. We can’t say that we are in a crisis now, but all hints are there and with this course it won’t stay a distant scenario anymore. The government is also aware of this situation.
Translation by WHatti