Turkish lira in freefall as US-Turkey tensions escalate

By On August 18, 2018

Turkish lira in freefall as US-Turkey tensions escalate

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Tensions continue to rise between the U.S. and its NATO ally Turkey after both countries imposed sanctions on one another over the release of a U.S. pastor held in Turkey since 2016. The spat has caused the Turkish economy to plummet, and on Saturday President Erdogan called the sanctions an “attempted economic coup.” Associated Press reporter Christopher Torchia joins Hari Sreenivasan for more.

  • HARI SREENIVASAN:

    Tensions are rising between the United States and its NATO ally Turkey. Today in Ankara, President Recep Tayyip Erdogan addressed thousands of supporters at his country’s currency continues to fall. Erdogan i s calling the United States’ recent economic sanctions an “attempted economic coup.”

  • TURKISH PRESIDENT, TAYYIP ERDOGAN:

    Today some people are trying to threaten us through the economy, through sanctions, foreign exchange, interest rates and inflation. We are telling them we’ve seen your games and we are challenging.

  • HARI SREENIVASAN:

    Erdogan’s statements come one day after President Trump called Turkey “a problem for a long time.” Associated Press reporter Christopher Torchia is covering events in Turkey and he joins us now via Skype from Istanbul. So tell me a little bit more about what President Erdogan said today.

  • CHRISTOPHER TORCHIA:

    Today the Turkish President Recep Tayyip Erdogan again had some strong rhetoric directed at the United States. He talked about an attempted economic coup, which is sort of language that echoes and recalls a 2016 attempted coup by some military units. So the comparison is strong to say the least. He also said in comments that seemed to be directed at the U.S. that we know your game and we’l’ challenge you.

  • HARI SREENIVASAN:

    It’s important to point out that this the trade sanctions that the United States has imposed are not the sole reason for the decline of the Turkish economy. It’s been sliding for a while, right?

  • CHRISTOPHER TORCHIA:

    That’s absolutely correct, Hari. In a sense, it’s really quite a turnaround â€" a negative one for Turkey, which h ad strong economic growth for many years and was considered a success story, regional power for some time. But a lot of that growth was fueled by heavy foreign currency borrowing and the economy has been overheating and now it could be that some companies will, in Turkey, will be unable to pay back those debts. And for that reason the people have the jitters. So it’s a structural problem that has been developing for a long time, [it] is not just linked to this dispute with the U.S.

  • HARI SREENIVASAN:

    Tell me a little bit about what the latest situation is with Andrew Brunson, the pastor at the center of all this.

  • CHRISTOPHER TORCHIA:

    Yeah, well he remains under house arrest and house detention. He’s in the Turkish city of Izmir. He remains on trial for alleg ed offences linked to terrorism. He again attempted, through his lawyer, to appeal for a lifting of a travel ban and for his release. But a couple of Turkish courts turned down those requests this week. So Turkey is certainly holding the line on the case of the pastor and is not giving in to American demands that he be released immediately. So it really is a major sticking point in the U.S.- Turkey relationship but not the only one.

  • HARI SREENIVASAN:

    Is the thinking that the heir to one is holding Andrew Brunson as some sort of leverage to try to get his way to get to Fethullah Gülen a person who he wants back from the United States?

  • CHRISTOPHER TORCHIA:

    That is certainly the the view of of some people or the view of the United States. President Trump and oth ers believe the charges against the pastor, Andrew Brunson, are trumped up and are essentially that they’re framing this pastor as a way, as you say, to to put pressure on the U.S. to hand over to Fethullah Gülen who is the Turkish Muslim cleric accused of fomenting the 2016 attempted coup. He’s living in Pennsylvania at the moment. And but for a couple of years now American officials have said to Turkey that Turkey has to provide convincing evidence of involvement in that attempted coup in order for any extradition proceeding to go forward.

  • HARI SREENIVASAN:

    All right. Associated Press reporter Christopher Torchia joining us via Skype from Istanbul. Thanks so much.

  • CHRISTOPHER TORCHIA:

    Thank you.

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