Despite efforts to stop lira fall, Turks still worried

Turkish Lira banknotes are seen in this October 10, 2017 picture illustration. (Reuters)
Updated 26 May 2018
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Despite efforts to stop lira fall, Turks still worried

ANKARA: After the embattled Turkish lira weakened against the US dollar this week, Turks remain troubled over the economy despite the government’s reassurances.
The lira’s drama worsened on Wednesday when Japanese investors sold Turkish assets, after comments by President Recep Tayyip Erdogan spooked investors earlier in May.
The lira hit 4.92 against the dollar before paring back some of its losses on Wednesday after an emergency central bank interest rate hike, but for many it’s not enough.
In a busy bureau de change on one of Ankara’s popular streets, thoughts turn to the worsening situation and fears that the country is already in a “currency crisis,” as experts at Commerzbank have described it.
During AFP’s visit, dozens came in to change their liras into gold, dollars and euros.
Ali Yilik indicated he was not convinced by Ankara’s reassurances as he changed his money into dollars for work.
“Who wouldn’t be worried about the exchange rate (situation)? This is not something that happens in normal conditions. It is extraordinary,” Yilik, who sells construction material, said.
Ali’s son Yahya Yilik, who is the manager at Tunali Doviz, said more Turks were coming in buying euros and dollars amid worries that the lira would fall further.
“They think the lira will keep losing value,” Yilik told AFP, adding that interest rate increases were a “temporary measure.”
In the past “one or two weeks,” the manager said the center had sold more foreign exchange than those wanting to buy lira.
The fall followed Erdogan comments during his UK visit mid-May when he indicated he wanted a greater say in monetary policy if he won in June 24 polls. This then raised concerns over economic policy becoming more unpredictable.
Student Necdet Guven was in the bureau de change to obtain dollars ahead of a trip to the US in mid-June but said he was “really worried” about the economy.
“Because everyday our economy gets worse. In the past, Turkey used to be among the top countries for agriculture and livestock, but now we import meat from Serbia and straw from Russia,” Guven lamented.
“We are not that developed a country in terms of industry,” he added, saying he believed Turkey had the potential to develop the economy further.
The lira appeared to show no signs of dramatic improvement and was at 4.70 against the dollar on Friday. In the past month, the lira has lost over 16 percent of its value against the greenback.
In a bid to ease concerns, Deputy Prime Minister Mehmet Simsek — an ex Merrill Lynch economist trusted by markets — on Friday said the central bank “would do whatever is necessary” during an interview with NTV broadcaster.
“There is no question of taking steps back on either the independence of the central bank or the rule-based market economy,” Simsek vowed.
But not everyone looked at the situation pessimistically.
Orhan Albayrak said the euro and dollar’s value was increasing because of “outside forces’ economic pressure on Turkey,” adding there was “an artificial rise.”
But Albayrak, a wholesaler, was hopeful the lira’s fortunes would improve toward the date of the presidential and parliamentary elections.
“But when there are five, 10 days to the elections, I believe this increase will reverse,” he added.
Albayrak said the three percent key rate rise had some impact, but believed the lira could improve and “reach 4.2, 4.3” with further central bank moves supported by the government.
After the rate hike on Wednesday evening, Erdogan insisted Turkey would adhere to the global governance principles on monetary policy in the new system post-election.
But, Erdogan added he would not let those principles “finish our country off.”


Ghosn appeals against Japan bail rejection

Updated 17 January 2019
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Ghosn appeals against Japan bail rejection

  • The court has previously refused to release Ghosn on the grounds that he could present a flight risk and destroy evidence
  • If the bail appeal is turned down he faces at least a two-month period in pre-trial detention

TOKYO: Lawyers for former Nissan boss Carlos Ghosn on Thursday appealed against a decision by a Tokyo court to refuse him bail, as he faces charges on three counts of financial misconduct.
Since his stunning arrest on November 19 the auto tycoon has languished in a Tokyo detention centre, facing questioning over allegations he under-reported his salary and tried to shift personal losses onto the company.
On January 11 he was formally charged on two of the counts and his request for bail refused again. Even his own lawyer has admitted he is likely to be kept behind bars until a trial -- which could take six months.
The court has previously refused to release the 64-year-old Franco-Lebanese-Brazilian businessman on the grounds that he could present a flight risk and destroy evidence.
The appeal came as the French government called for him to be replaced at the head of Renault, the only one of the three companies he used to head that has retained him.
Japanese firms Nissan and Mitsubishi Motors jettisoned him as boss almost immediately after his arrest, but Renault was more cautious and appointed an interim leader while Ghosn fought the charges.
If the bail appeal is turned down he faces at least a two-month period in pre-trial detention. This can be extended almost automatically by one month at a time.
His wife Carole has appealed to Human Rights Watch over his detention, saying he was being held in "harsh" conditions and subjected to round-the-clock interrogations in an attempt to extract a confession.
Ghosn has been seen only once in public since his detention, in a dramatic court appearance.
He had clearly lost a lot of weight but seemed otherwise in good health. He passionately proclaimed his innocence and his love for Nissan, a company he is widely credited with saving from the brink of bankruptcy.
"I have been wrongly accused and unfairly detained based on meritless and unsubstantiated accusations," Ghosn told a packed courtroom.