Turkey’s economy is on the right track and interest rates will soon decrease while the Turkish Lira will rise in value, President Recep Tayyip Erdoğan has said, hailing newly-appointed Treasury and Finance Minister Berat Albayrak, who is also his son-in-law, for his “practical and theoretical background” in the finance sector.
“Turkey is on the right track. Our investments are obvious. The fact that international [finance] institutions and creditors grant loans to those who invest in Turkey is a clear indication of it. For example, the necessary financing for building the 18 March Bridge [over the Dardanelles Strait] has been received from abroad,” Erdoğan told reporters travelling with him to Azerbaijan and Turkish Cyprus on July 10.
Erdoğan’s comments came after the lira plunged severely immediately after he announced his cabinet. International experts expressed concerns over the composition of the economy management team that placed Albayrak in charge of the economy and excluded figures like former Economy Minister Mehmet Şimşek and Finance Minister Naci Ağbal.
“There is no problem,” Erdoğan said, expressing his hopes that everything “will be much better afterwards.”
Erdoğan has been inaugurated as the first head of Turkey’s new governmental system, which designates the president as the sole executive power with extensive authorities.
Accusing international media and international credit rating agencies of portraying the Turkish economy wrongly, Erdoğan said he does not care what these international bodies are saying about his government.
‘Albayrak has a background in finance sector’
Erdoğan stressed Albayrak has a practical and theoretical background in the finance sector and had staged a successful performance while working in the private sector. “Recently, he also lectured on this issue at Marmara University. I am sure that he will, as soon as possible, set things on the right track and will run successfully thanks to his background,” he said.
The decision to merge finance and treasury aims at creating an efficient coordination in running the Turkish economy, the president stressed. “These two ministries were united in the past but separated afterwards. Leaving aside any benefit, this brought damages on to the economy, because each ministry was acting in separate ways. Now, after a trial-and-error period, we have decided to re-unite them,” he said.
“Thus, the Treasury and Finance Ministry, in its new structure, will constitute a stronger source in providing finance to the state.”
Rates will be decreased
When asked about the devaluing national currency, Erdoğan said he was very sure that the lira will gain value in the coming period.
“Our treasury and finance minister will do whatever is necessary. We have many instruments to use. I believe that we will also see a decrease in interest rates. I am sure. Not only state banks but also our private banks will carry responsibility,” he said
High interest rates negatively affect employment, Erdoğan said, adding that it could only be boosted if convenient conditions would be created for investors and entrepreneurs.
‘Ministers know the world well’
On a question about the composition of the cabinet with many surprising figures from professional and bureaucratic life, Erdoğan said: “Our friends know the world well. They have no problems integrating with the world. Their best qualification is their honesty, eligibility and merits.”
Culture and Tourism Minister Mehmet Ersoy founded and has been operating one of Turkey’s best tourism agencies, Trade Minister Ruhsar Pekcan comes from the business world, Health Minister Fahrettin Koca is tasked with introducing the practices of the private health sector to the state’s services, Erdoğan elaborated.
General Staff ‘may be subordinated to Defense Ministry’
Erdoğan also explained the new military structure and its relationship with the government in the new governmental system.
He appointed Hulusi Akar, formerly the chief of General Staff, as defense minister.
On a question on whether the office of the Chief of General Staff may be subordinated under the defense minister, Erdoğan did not rule out the option, stressing it was one of the requirements of the EU from Turkey in the accession process.
“We will evaluate this with our friends under the new system. It’s not true to have a dual management. We now have to find a way to this. I am sure we will resolve this,” he stressed.
Relations between Akar and his successor Gen. Yaşar Güler as well as Land Forces Commander Gen. Ümit Dündar are very strong and sincere, Erdoğan said, ruling out any suspicion over their ties.
“We got rid of the civilian-military division. Ties between the Defense Ministry and Turkish Armed Forces will be based on solidarity. There will be no division in the decision-making processes.”