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Devaluation:
The Turkish lira has plummeted by 30 percent since January - Erdogan's son-in-law, Finance Minister Berat Albayrak (right), is now also declaring his resignation
Photo: Osman Orsal / REUTERS
The President of Turkey,
Recep Tayyip Erdogan
(66), wants to stop the fall of the local currency lira by replacing his top staff.
After the departure of the central bank chief of Turkey, Finance Minister
Berat Albayrak
(42)
has now also announced
his resignation.
It is questionable whether this personnel carousel will stop the currency from plummeting in the long term - after all, Erdogan's course of isolation from the West recently put the Turkish lira under further pressure.
On Sunday, Finance Minister Albayrak surprisingly offered to vacate his post.
The son-in-law of President Erdogan announced on Instagram on Sunday that he could no longer exercise the office for health reasons.
Also in circles of the ministry it was said that the 42-year-old would resign.
After the announcement, the Turkish lira initially gained more than 2 percent against the dollar.
It was the second financial policy surprise at the weekend: Erdogan replaced central bank boss
Murat Uysal
(49)
on Saturday
.
The lira has lost 30 percent against the dollar this year.
It fell to a new record low on Friday.
Erdogan replaces head of central bank with ex-finance minister
Albayrak served as Secretary of the Treasury for the past two years and previously served as Secretary of Energy for three years.
His resignation came as a surprise to experts and MPs.
The vice-chairman of the ruling AK party,
Mehmet Mus
(38), expressed the hope in a first reaction on Twitter that Erdogan would reject the resignation.
Albayrak has taken important steps to strengthen the economy.
Vice Minister of Transport
Ömer Fatih Sayan
(43) also spoke out against resigning.
"Our country, our people and our community need you," he wrote to Albayrak.
Erdogan had replaced central bank chief Uysal by decree on Saturday by ex-finance minister
Naci Agbal
(52).
While analysts welcomed this step, the opposition criticized it: It would increase Erdogan's influence on the country's monetary policy.
"What was still missing was a central bank affiliated to the party, now the time has come," said a member of the Republican People's Party (CHP).
Erdogan promoted Uysal to the top of the central bank in July 2019 after
firing
his predecessor
Murat Cetinkaya
(44) in a dispute over what he saw as too high interest rates.
The next interest rate decision is due on November 19th.
Interest rate opponent Erdogan sees his country in a "devil's triangle"
Erdogan is a declared opponent of interest.
He sees his country in an economic war against a "devil's triangle" made up of interest rates, exchange rates and inflation.
The president had hoped that the most recent interest rate cuts, which he was instrumental in, would give the economy more impetus.
The Turkish lira crisis is being driven by high inflation.
This was most recently 12 percent, while the central bank is aiming for 5 percent.
Turkey's badly melted currency reserves have also accelerated the decline.
In addition, tensions in the relationship with the EU and the USA and concerns about possible sanctions weigh on the currency of the emerging market.
On the political side, the numerous military conflicts in which Turkey is involved, such as in Syria or Libya, are a burden.
In addition, Turkey's diplomatic relations with numerous western partner countries, such as the USA, France and Greece, are strained.
Analysts assume that after Joe Biden's election victory in the US, there could be further tensions between the governments in Ankara and Washington.
By Orhan Coskun and Nevzat Devranoglu, Reuters
