Turkish President Recep Tayyip Erdogan has come out strongly in defence of his country in what he described as an economic war unleashed by US on Turkey to weaken their economy. The reaction was in response to higher tariffs imposed by US on metal imports from Turkey.
The relation between two allies has sunk to all-time low as both the nations have locked horns over multiple issues ranging from Turkish ventures in Syria to its Russian deal of purchase of S400 Russian anti-missile systems, in addition to the case of US pastor who has been detained in Turkey on charges of conspiracy and terrorist activities.
The dip in relations has had a hard hitting on the Turkish currency which has slid by 30 percent against US dollar over 1 year. US administration had doubled the tariffs on aluminium and steel imports from Turkey last week which further plunged Lira in deeper lows and affected a dip of 18.5 percent in one go.
Erdogan sternly stated in a rally in Turkish state of Rize that US will have to pay for waging an economic war against most of the world and its policies of holding countries on ransom via sanctions. He told his people that Turkey is not going through any crisis and the way to ward off the effects of the sanctions is by increasing production and lowering the interest rates to a minimum. Erdogan is known as an ‘enemy of the interest rates’ and is seeking cheap loans from banks to fuel growth.
Experts have expressed caution and state that the economy is heading for a flat crash. Investor sentiment is also in doldrums as a potential clash with US will have a clear effect on stock markets in Turkey. The fall in Turkish currency has also sent worrying signals to EU as some of the biggest banks of the trade bloc are exposed to Turkey.
Turkish President also signaled that US-Turkish ties is going through hard winds and Turkey will look for new partnerships and allies while pointing to countries like Iran, China, Russia etc. Turkey buys energy from Iran in addition to Azerbaijan and Russia.