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Turkey Letter: December 18, 2017

Foreign Policy:

 

  • Turkey’s leading business group slams Austria’s EU call
  • Turkey Frees German Journalist Tolu but She Cannot Leave Country
  • Erdogan says Turkey will clear border of Syrian Kurds
  • Turkey Plans Embassy in East Jerusalem
  • In Iran Sanctions Case, a Clash Over Turkish Banker’s Role
  • Turkey Seeking to Annul Trump Decision on Jerusalem at UN
  • Turkey summons FBI attache over testimony in US trial
  • Russian Credit to Cover Part of S-400 Missile Deal With Turkey

Economy and Energy:

 

  • Seven flag carriers halt Istanbul flights amid demand slump, rise in Turkish carriers
  • Gazprom makes record high gas exports to Turkey in 2017
  • Erdogan’s Eccentric Theory of Inflation Scores a Win in Turkey
  • Turkey Raises Key Interest Rate by Less than Expected Amid Political Pressure
  • Lira Slumps as Turkey Rate Hike Falls Short of Expectations
  • The $42 Billion Reason Turkey’s Lira May Not Be Cheap Enough Yet

Domestic Politics:

 

  • Detention warrants issued for 106 ‘matchmakers’ in Gülen network
  • Protestors demand halt of planned construction in Gölcük Natural Park in Turkey’s Bolu
  • Number of female officers in Turkish gendarmerie to increase by 10 percent
  • AKP, CHP tension escalates further amid off-shore accounts row
  • Turkish Coast Guard in Dramatic Rescue of Stranded Migrants

 

Foreign Policy:

 

Turkey’s leading business group slams Austria’s EU call

The Turkish Industry and Business Association (TÜSIAD) stated on Dec. 18 that the new Austrian government’s approach to Turkey “harmed bilateral relations and European values.” In a statement issued over a call by Austria’s new coalition government to halt Turkey’s EU accession negotiations, TÜSIAD described the move as “extremely negative.”

Hürriyet Daily News, Turkey’s leading business group slams Austria’s EU call, December 18, 2017


Turkey Frees German Journalist Tolu but She Cannot Leave Country

Turkey has released German journalist Mesale Tolu after nearly eight months in prison on the condition that she does not leave the country, German government officials said on Monday.

The New York Times, Turkey Frees German Journalist Tolu but She Cannot Leave Country-Berlin Government, December 18, 2017


Erdogan says Turkey will clear border of Syrian Kurds

Turkey’s president slammed a U.S.-backed Syrian Kurdish militant group Sunday and said he’ll clear his country’s border with Syria of “terrorists.” President Recep Tayyip Erdogan told a rally in the central province of Karaman his country would not allow “terror nests” near its border, referring to areas held by the People’s Protection Units or YPG in northern Syria.The Washington Post, Erdogan says Turkey will clear border of Syrian Kurds, December 17, 2017


Turkey Plans Embassy in East Jerusalem

Turkey intends to open an embassy in East Jerusalem, President Recep Tayyip Erdogan said on Sunday, days after leading calls at a summit of Muslim leaders for the world to recognize it as the capital of Palestine.

The New York Times, Turkey Plans Embassy in East Jerusalem, December 17, 2017


In Iran Sanctions Case, a Clash Over Turkish Banker’s Role

It was on Thursday when lawyers for a Turkish banker on trial in Manhattan federal court told the judge that their client would take the stand the next day, to testify on his own behalf. The banker, Mehmet Hakan Atilla, 47, had been charged with conspiring to violate United States sanctions on Iran in a case that has drawn much attention in Turkey, including from that country’s president, Recep Tayyip Erdogan, who has repeatedly criticized the prosecution.

The New York Times, In Iran Sanctions Case, a Clash Over Turkish Banker’s Role, December 16, 2017


Erdogan Says Turkey Seeking to Annul Trump Decision on Jerusalem at UN

Turkey is launching an initiative at the United Nations to annul a decision by the United States to recognise Jerusalem as Israel’s capital, President Tayyip Erdogan said on Friday.

The New York Times, Erdogan Says Turkey Seeking to Annul Trump Decision on Jerusalem at UN, December 15, 2017


Turkey summons FBI attache over testimony in US trial

Turkish police have summoned an FBI official stationed in Turkey in connection with testimony in a U.S. federal corruption case against a Turkish banker, Turkey’s official news agency reported.

The Washington Post, Turkey summons FBI attache over testimony in US trial, December 14, 2017


Russian Credit to Cover Part of S-400 Missile Deal With Turkey

Russia will offer Turkey partial financing for Ankara’s purchase of S-400 surface-to-air missile systems, the Interfax news agency reported on Tuesday, citing a Russian presidential aide.

The New York Times, Russian Credit to Cover Part of S-400 Missile Deal With Turkey, December 12, 2017


Economy and Energy:

 

Seven flag carriers halt Istanbul flights amid demand slump, rise in Turkish carriers

Five European and two American flag carriers have recently stopped their Istanbul flights for a number of reasons, including a demand plunge for Turkish routes, a slot shortage in Istanbul’s main airport, and increasingly competitive Turkish airliners, daily Dünya reported on Dec. 18.

Hürriyet Daily News, Seven flag carriers halt Istanbul flights amid demand slump, rise in Turkish carriers, December 18, 2017


Gazprom makes record high gas exports to Turkey in 2017

Gazprom increased its gas supplies to Turkey by 18.8 percent between Jan. 1 and Dec. 15, Russian news agency TASS reported on Dec. 17. Gazprom has reportedly stated that it sent 27.6 billion cubic meters (bcm) of gas to Turkey, a record high during that period.

Hürriyet Daily News, Gazprom makes record high gas exports to Turkey in 2017, December 18, 2017


Erdogan’s Eccentric Theory of Inflation Scores a Win in Turkey

For years, Turkey’s President Recep Tayyip Erdogan has hawked an eccentric theory that challenged modern inflation-fighting methods: the key to containing prices was lower interest rates, he maintained. For weeks, he has pressured his own independent central bank not to lift borrowing costs. On Thursday, he chalked up a small victory.

Bloomberg, Erdogan’s Eccentric Theory of Inflation Scores a Win in Turkey, December 15, 2017


Turkey Raises Key Interest Rate by Less than Expected Amid Political Pressure

The trial in Turkey’s central bank raised a key interest rate Thursday for the first time since April, in a move to tame double-digit inflation and support the Turkish lira that missed market expectations.

Wall Street Journal, Turkey Raises Key Interest Rate by Less than Expected Amid Political Pressure, December 14, 2017


Lira Slumps as Turkey Rate Hike Falls Short of Expectations

Turkey’s lira headed for its biggest loss against the dollar in more than a month and bonds fell after the central bank raised a key rate less than expected. The lira fell as much as 2.1 percent and the yield on the nation’s 10-year bond yield headed for a two-week high after policy makers raised the rate on the so-called late liquidity window by 50 basis points, compared with expectations for a 100-basis point increase. Policy makers left all other rates unchanged.

Bloomberg, Lira Slumps as Turkey Rate Hike Falls Short of Expectations, December 14, 2017


The $42 Billion Reason Turkey’s Lira May Not Be Cheap Enough Yet

The Turkish lira hasn’t been this cheap in more than a decade, but that’s done little to correct an economic imbalance that makes it vulnerable to more losses. Turkey’s 12-month current-account deficit widened to $41.9 billion in October, the largest since 2015, even as the currency’s real effective exchange rate (REER) slumped to the lowest in at least 14 years.

Bloomberg, The $42 Billion Reason Turkey’s Lira May Not Be Cheap Enough Yet, December 11, 2017


Domestic Politics:

 

Detention warrants issued for 106 ‘matchmakers’ in Gülen network

The authorities on Dec. 18 issued detention warrants for 106 people believed to have worked as “matchmakers” for the Fethullahist Terrorist Organization (FETÖ), accused of orchestrating Turkey’s July 2016 coup attempt, a spokesman for the Istanbul police has stated.

Hürriyet Daily News, Detention warrants issued for 106 ‘matchmakers’ in Gülen network, December 18, 2017


Number of female officers in Turkish gendarmerie to increase by 10 percent

The number of female officers and non-commissioned officers in the Turkish Gendarmerie Command will be increased by 10 percent as part of a move to establish more balance between men and women in the command.

Hürriyet Daily News, Number of female officers in Turkish gendarmerie to increase by 10 percent, December 18, 2017 


Protestors demand halt of planned construction in Gölcük Natural Park in Turkey’s Bolu

Hundreds of people gathered to protest the decision set to build a mansion and 25 bungalows in the Gölcük National Park, one of the symbols of the northwestern province of Bolu on Dec. 17.  Led by the Gölcük Platform, the crowd formed a human chain, chanted around the park and made a declaration in front of the municipality building, reacting to the Bolu Municipality’s decision to take the natural park out to tender for 22 years on Dec. 19, transferring the park’s remaining operating license.

Hürriyet Daily News, Protestors demand halt of planned construction in Gölcük Natural Park in Turkey’s Bolu, December 18, 2017


AKP, CHP tension escalates further amid off-shore accounts row

Tension between Turkey’s ruling and main opposition parties escalated further over the weekend, with President Recep Tayyip Erdoğan vowing that Republican People’s Party (CHP) leader Kemal Kılıçdaroğlu will “soon pay the price for his claims at court.”

Hürriyet Daily News, AKP, CHP tension escalates further amid off-shore accounts row, December 17, 2017


Turkish Coast Guard in Dramatic Rescue of Stranded Migrants

Turkey’s coast guard launched a dramatic rescue operation Thursday to evacuate migrants stranded on rocks in the Aegean Sea. The coast guard said in a statement that 51 migrants attempted to illegally cross to Greece on a rubber dinghy from the western province of Izmir. Authorities intervened after receiving an emergency call at 01:12 local time (1012 GMT).

The New York Times, Turkish Coast Guard in Dramatic Rescue of Stranded Migrants, December 14, 2017