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Turkey Letter: 20 August 2018

Foreign Policy: 

  • Amid tensions, shots fired at U.S. Embassy in Turkey 
  • Attack on economy like attack on Turkish flag 
  • Merkel ‘sees no need for special German aid for Turkey’  
  • German journalist in court case cleared to leave Turkey 
  • Turkish court rejects US pastor Brunson’s fresh appeal for release 
  • Trump Says Turkey Has Acted Badly in Brunson Case 
  • Turkish defense minister, intelligence chief in Russia to discuss Syria’s Idlib 
  • China Offers Turkey Moral Support, Says Can Overcome Difficulties 
  • Mnuchin Says Turkey Faces More Sanctions If Pastor Not Released  
  • Challenged by US and market crisis, Turkey turns to Europe 

 

Economy and Energy:

  • Turkey Initiates WTO Dispute Complaint Over Additional U.S. Tariffs 
  • Turkey Rating Cut To B+ From BB- By S&P 
  • Turkish, Qatari central banks ink currency swap deal 
  • Moody’s cuts Turkey’s credit rating further 
  • Turkish Finance Ministry Says Credit Channels to Remain Open 
  • Turkish Banking Watchdog Broadens Limits on Derivative Transactions 
  • Turk Telekom, Turkey’s Vestel Clinch Deal After Erdogan Call to Snub iPhone 
  • Turkey increases tariffs on some US goods, escalating feud 
  • Gold Trading Volumes Double in Turkey Amid Currency Crisis 

 

Domestic Politics: 

  • CHP blames government’s construction-based economy for lira depreciation 
  • Turkey’s ruling party official rules out early local elections 
  • Ruling AKP reshuffles top management 
  • Four clerics killed in eastern Turkey in armed attack amid imams’ debate 

 

Foreign Policy: 

 Amid tensions, shots fired at U.S. Embassy in Turkey 

An unidentified gunman fired six shots at the U.S. Embassy in Ankara, the Turkish capital, early Monday, striking a guard booth but causing no injuries at the embassy, which was closed at the time, the Ankara governor’s office said in a statement.   

Washington Post, Amid tensions, shots fired at U.S. Embassy in Turkey, August 20, 2018 



 Attack on economy like attack on Turkish flag 

President Recep Tayyip Erdoğan has called the ongoing currency crisis an attack on the Turkish economy, which he described as an attack on the Turkish flag and call to prayer, indirectly defying the United States administration’s warnings of more sanctions if the U.S. pastor is not released soon. 

Hürriyet Daily News, Attack on economy like attack on Turkish flag, August 20, 2018  


Merkel ‘sees no need for special German aid for Turkey’ 

German Chancellor Angela Merkel told her Christian Democrats (CDU) at a meeting that she saw no urgent need to offer financial aid for Turkey to ease its currency crisis, the conservative party’s general secretary said on Aug. 20. 

Hürriyet Daily News, Merkel ‘sees no need for special German aid for Turkey’, August 20, 2018  


German journalist in court case cleared to leave Turkey 

A Turkish court has ruled that German journalist Mesale Tolu can leave the country, eight months after being released from prison during a trial on terror-related charges. 

Washington Post, German journalist in court case cleared to leave Turkey, August 20, 2018  


Turkish court rejects US pastor Brunson’s fresh appeal for release 

A Turkish court has rejected an appeal for United States Christian pastor Andrew Brunson to be released from house arrest during his trial on terrorism charges. The 3rd Penal Court in the western province of İzmir rejected the appeal on Aug. 17, ruling for the continuation of Brunson’s house arrest, as well as a travel ban imposed on him. 

Hürriyet Daily News, Turkish court rejects US pastor Brunson’s fresh appeal for release, August 17, 2018  


Trump Says Turkey Has Acted Badly in Brunson Case 

U.S. President Donald Trump on Friday said the United States was not going to take Turkey’s detention of U.S. Christian pastor Andrew Brunson “sitting down,” a day after his Treasury chief said Washington could hit Ankara with further sanctions. 

New York Times, Trump Says Turkey Has Acted Badly in Brunson Case, August 17, 2018  


Turkish defense minister, intelligence chief in Russia to discuss Syria’s Idlib 

Turkey’s defense minister and the head of the National Intelligence Organization (MİT) have paid a snap visit to Moscow to discuss recent developments in Syria, amid concerns over the Syrian regime’s ongoing military operation in the Idlib province, which Turkey says could produce catastrophic consequences for both civilians and Turkey’s border security. 

Hürriyet Daily News, Turkish defense minister, intelligence chief in Russia to discuss Syria’s Idlib, August 17, 2018  


China Offers Turkey Moral Support, Says Can Overcome Difficulties 

China offered moral support to Turkey on Friday as Ankara reeled from a currency crisis and U.S. sanctions, saying it believed the country could overcome its “temporary” economic difficulties, in Beijing’s first comment on the issue. 

New York Times, China Offers Turkey Moral Support, Says Can Overcome Difficulties, August 17, 2018  


Mnuchin Says Turkey Faces More Sanctions If Pastor Not Released 

Treasury Secretary Steven Mnuchin said the U.S. is ready to slap Turkey with more sanctions if President Recep Tayyip Erdogan refuses the quick release of an American pastor, escalating a diplomatic rift that has roiled global financial markets. 

Bloomberg, Mnuchin Says Turkey Faces More Sanctions If Pastor Not Released, August 16, 2018  


Challenged by US and market crisis, Turkey turns to Europe 

Beset by a shaky currency and tension with the United States, Turkey is reaching out to Europe to shore up relations with major trading partners despite years of testy rhetoric and a stalled bid for EU membership. 

Washington Post, Challenged by US and market crisis, Turkey turns to Europe, August 16, 2018  


Economy and Energy: 

 Turkey Initiates WTO Dispute Complaint Over Additional U.S. Tariffs 

Turkey has initiated a dispute complaint with the World Trade Organisation against additional tariffs imposed by the United States on Turkish steel and aluminium imports, the WTO said on Monday. 

New York Times, Turkey Initiates WTO Dispute Complaint Over Additional U.S. Tariffs, August 20, 2018  


Turkey Rating Cut To B+ From BB- By S&P 

Turkey’s sovereign credit rating was cut to B+ from BB- at S&P Global Ratings, and the outlook was kept at stable. 

Bloomberg, Turkey Rating Cut To B+ From BB- By S&P, August 17, 2018  


Turkish, Qatari central banks ink currency swap deal 

The central banks of Qatar and Turkey signed a currency swap agreement in the Qatari capital Doha. According to sources from Turkish central bank, the first step has been taken after Qatar pledged $15 billion of investment package in Turkey last Wednesday. 

Hürriyet Daily News, Turkish, Qatari central banks ink currency swap deal, August 20, 2018  


Moody’s cuts Turkey’s credit rating further 

Ratings agency Moody’s has downgraded Turkey’s credit rating deeper into “junk” status and slapped a “negative” rating on its outlook. It’s the latest blow to the country whose currency, the lira, has taken a battering amid concerns about fundamental economic problems and a diplomatic and trade dispute with the United States. 

Washington Post, Moody’s cuts Turkey’s credit rating further, August 17, 2018  


Turkish Finance Ministry Says Credit Channels to Remain Open 

Turkey’s finance ministry said on Friday that credit channels would remain open and that it would take measures to relieve banks and the real sector, after the Turkish lira currency crashed to a record low against the dollar earlier this week. 

New York Times, Turkish Finance Ministry Says Credit Channels to Remain Open, August 17, 2018  


Turkish Banking Watchdog Broadens Limits on Derivative Transactions 

Turkey’s BDDK banking watchdog on Friday said it would broaden limits on banks’ forex swap transactions to include lira forward and option-type derivative transaction. 

New York Times, Turkish Banking Watchdog Broadens Limits on Derivative Transactions, August 17, 2018  


Turk Telekom, Turkey’s Vestel Clinch Deal After Erdogan Call to Snub iPhone 

Turkish fixed-line operator Turk Telekom said on Friday that it clinched a cooperation deal with Vestel after President Tayyip Erdogan called on Turks to use locally-made mobile phones instead of Apple’s iPhone. 

New York Times, Turk Telekom, Turkey’s Vestel Clinch Deal After Erdogan Call to Snub iPhone, August 17, 2018  


Turkey increases tariffs on some US goods, escalating feud 

Turkey said Wednesday it is increasing tariffs on some U.S. products like cars, alcohol, and coal — a move that is unlikely to have much economic impact but highlights the deteriorating relations with the U.S. in a feud that has already helped trigger a currency crisis. 

Washington Post, Turkey increases tariffs on some US goods, escalating feud, August 15, 2018  


Gold Trading Volumes Double in Turkey Amid Currency Crisis 

First Turkish President Recep Tayyip Erdogan argued citizens should buy gold, then he said sell. Add dramatic swings in the lira, and the country’s traders are now enthusiastically doing both. 

Bloomberg, Gold Trading Volumes Double in Turkey Amid Currency Crisis, August 18, 2018  


 Domestic Politics: 

 CHP blames government’s construction-based economy for lira depreciation 

The main opposition Republican People’s Party (CHP) has blamed the ruling Justice and Development’s (AKP) construction-based economy for the record-breaking plunge of the Turkish Lira, accusing it of deliberately weakening production capacity of the country. 

Hürriyet Daily News, CHP blames government’s construction-based economy for lira depreciation, August 20, 2018 


Turkey’s ruling party official rules out early local elections 

A senior official from the ruling Justice and Development Party (AKP) has ruled out the possibility of bringing local elections forward from their original date on March 2019. “We do not consider holding snap polls. Local elections will be held on March 31, 2019. We have seven months left until elections,” said AKP deputy chair Ali İhsan Yavuz, who is in charge of election affairs. 

Hürriyet Daily News, Turkey’s ruling party official rules out early local elections, August 20, 2018 


 Ruling AKP reshuffles top management 

The ruling Justice and Development Party (AKP) has reshuffled its top management board at its sixth grand congress, with President Recep Tayyip Erdoğan being re-elected as the party’s chair with almost all the votes. 

Hürriyet Daily News, Ruling AKP reshuffles top management, August 18, 2018 


Four clerics killed in eastern Turkey in armed attack amid imams’ debate 

Four clerics have been killed after an argument between imams at a town hall ended with an armed assault in eastern Turkey in which the assailant also died after committing suicide. Demirören News Agency reported that the local administration of the Erzincan province’s Tercan district convened for an ordinary monthly meeting on Aug. 17. 

Hürriyet Daily News, Four clerics killed in eastern Turkey in armed attack amid imams’ debate, August 17, 2018