Correspondent Mitra Nazar on Erdogan’s motivation to keep cutting interest rates
“It is known that Erdogan has never been in favor of high interest rates, partly because of an Islamic ideology. And he makes that argument every now and then, mainly because it gives his conservative supporters a form of confidence.
But what Erdogan is doing now has mainly to do with his desire to quickly turn Turkey into an export country. A weak lira makes Turkish products cheaper abroad. He calls it a war for economic independence and speaks of a new economic model that is not subject to the whims of the financial markets.
Economists see it as a dangerous experiment, because Turkey is economically inextricably linked with the rest of the world. But Erdogan has taken a road that no one seems to be able to pull him off. And the Turks have to pay the price, literally and figuratively.”
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