Exporters living in Erdogan’s world find no place is like home

Turkish exporters achieved a record performance last year, but face challenges due to an overvalued local currency and a cooling demand in Europe. The government's economic policies, including a requirement for exporters to convert 40% of foreign income into lira, have led to trade imbalances. Despite high inflation, companies like System Denim find it easier to pass costs to local consumers. President Erdogan aims to make Turkey a manufacturing hub, but industries are calling for a devaluation of the lira to boost competitiveness. The upcoming election adds pressure as Erdogan showcases policy successes and aims to stabilize inflation with a steady lira. Turkey's ambition to become a top 10 global exporter is still distant, with companies weighing domestic sales against foreign currency earnings.

Turkey’s Budget Swings to Deficit That Reaches Biggest This Year

Turkey's central government budget recorded a deficit of 78.6 billion liras ($4.2 billion) in September, marking the largest shortfall this year due to increased spending and decreased corporate tax revenues. This follows a surplus of 3.6 billion liras in August, driven by a surge in tax revenue, according to data from the Treasury and Finance Ministry.

Turkish Officials Suspect Terrorism in Istanbul Explosion

A bomb explosion in Istanbul's popular tourist district killed at least six people and injured 81, with Turkish officials suspecting a terrorist attack. The explosion occurred on İstiklal Street, a busy area with bars, cafes, and shops. Authorities have arrested the person who planted the bomb. The incident comes as Turkey prepares for presidential and parliamentary elections in six months, highlighting the ongoing threat of terrorism. The Turkish government has imposed media restrictions and slowed internet access for security reasons.

Lira Slumps as Erdogan Adds to Rate-Cut Angst Before Decision

Turkey's lira hit a record low as President Recep Tayyip Erdogan reiterated his stance against high interest rates, fueling speculation of another rate cut by the central bank despite rising inflation. The lira fell for the seventh consecutive day, with economists predicting a further 100 basis point cut in the benchmark rate, exacerbating the currency's depreciation.

Turkey May Back Finland’s Bid for NATO Membership, Reject Sweden

Turkey may ratify Finland's bid to join NATO while rejecting Sweden's due to Sweden's perceived leniency towards Kurdish militants and recent incidents that have angered Turkey. Erdogan's statements suggest a strategic move that could delay Sweden's NATO membership.

Turkey Central Bank Resumes Interventions to Stem Lira Rout

The Turkish central bank intervened in the currency market for the second time this week to counteract the lira's depreciation, which has lost nearly half its value this year. The intervention, involving the sale of around $200 million, temporarily boosted the lira before it fell back. This move follows a significant rise in consumer inflation and concerns over President Erdogan's policy of lowering borrowing costs. The central bank's actions highlight the lack of investor confidence in Turkey's economic policies, exacerbated by the recent replacement of the finance minister. Turkey's net currency reserves are significantly negative, reflecting the severe financial strain.

Turkish Companies Go Solar at Record Pace to Cut Energy Costs

A record number of Turkish companies are installing solar systems to mitigate soaring electricity costs driven by a currency collapse and global energy price spikes. Over 300 companies recently applied for solar panel installation approval. The demand for solar power has surged due to higher gas prices and a weakened lira, compounded by the Russia-Ukraine conflict. Turkey's simplified process for selling surplus renewable energy has further boosted the market. Major companies like Turkcell plan significant investments in renewable energy, expecting substantial cost reductions. Affordable green financing from banks and international institutions like the EBRD has also supported this trend, encouraging both local and foreign investments in solar panel manufacturing.

Railway Talks With China Collapse as Uganda Turns to Turkey

Uganda has terminated its $2.3 billion railway project deal with a Chinese contractor due to the failure to secure financial backing from Beijing. The country is now in discussions with Turkish company Yapi Merkezi to take over the project, with an expression of interest expected in the coming weeks. This decision ends Uganda's eight-year pursuit of Chinese funding for the 273-kilometer railway project.

Exporters Living in Erdogan's World Find No Place Is Like Home

Turkish exporters are facing a challenging economic environment as President Recep Tayyip Erdogan balances competing priorities ahead of elections. Despite a record year for exports, local companies are finding domestic demand more appealing due to an overvalued currency and recession fears in Europe. The Turkish government has implemented policies to stabilize the lira and stimulate the economy, but businesses are calling for a more competitive exchange rate. The situation is further complicated by high inflation and a significant trade deficit. Key stakeholders, including the Aegean Exporters’ Associations and Treasury and Finance Minister Nureddin Nebati, are advocating for strategic adjustments to support local production and exports.

Turkey to Impose Refugee Quotas as Pre-Election Outcry Mounts

Turkey, hosting the world's largest refugee population, is imposing residency quotas in certain areas to address rising anti-immigrant sentiment ahead of national elections. Asylum-seekers will be restricted from moving to 16 provinces where they already form 25% of the population, including Istanbul, Ankara, and Hatay. The policy aims to contain discontent fueled by economic decline and competition for jobs and health services. President Erdogan's popularity has been affected by these issues, with about 5 million refugees, mostly Syrians, perceived as economic and social threats. Interior Minister Suleyman Soylu mentioned voluntary relocation of some refugee families to less populated areas.