Published: Mon, August 13, 2018
Finance | By Kristine Clayton

Turkish lira plunges as Erdogan blames crash on 'political plot' against Ankara

Turkish lira plunges as Erdogan blames crash on 'political plot' against Ankara

Relations between the two North Atlantic Treaty Organisation allies have taken a turn for the worse amid dispute over the detention in Turkey of USA evangelical pastor Andrew Brunson on terrorism charges. "This is Turkey", he said.

Turkish President Recep Tayyip Erdogan on Saturday warned the United States that it risked losing a "strategic partner" due to demands made by the U.S. government that Turkey release an American pastor who was arrested on terrorism charges.

Unprecedented punitive sanctions declared by the U.S. President Donald Trump's administration on two Turkish ministers over the detention of an American pastor, as well as doubling tariffs on steel and aluminum, have worsened relations between the North Atlantic Treaty Organisation allies to their lowest over decades.

After Brunson had been in jail for nearly 20 months, a court in July ordered him to be moved to house arrest.

A Turkish delegation visited Washington for talks this week but left with no signs of a breakthrough.

With the dispute intensifying, Trump on Friday doubled steel and aluminum tariffs on Turkey, sending the beleaguered lira plunging 16 percent, part of a 40 percent plummet for the currency this year.

An important emerging market, Turkey borders Iran, Iraq and Syria and has been mostly pro-Western for decades.

On the brink of a full-blown currency crisis, Turkey's lira plunged to a record low on Friday, tumbling as much as 18 percent in its biggest daily drop since 2001.

"I am asking you".

Turkey's presidential spokesman, Ibrahim Kalin, also said Saturday that Washington risked losing Ankara as an ally if U.S. policies against Turkey continued.

Turkish Treasury and Finance Ministry announced a "new economic model", aiming to stabilize their economic growth.

He also repeated his call to Turks to sell their dollar and euro savings to shore up the lira. Do not take a stance saying, "We are bankrupt, we are done, we should guarantee ourselves.' If you do that, that would be wrong". "We will be taking the necessary steps with our banks and banking watchdog in a speedy manner", he said.

He also said it was a pity that Washington chose Brunson over Turkey, its partner in North Atlantic Treaty Organisation, and in an opinion piece in the New York Times, he warned the United States that Ankara had other alternatives as allies. The managing director of the Washington Institute for Near East Policy, Michael Singh, reported that, "Although Pastor Brunson's case is the most visible of bilateral irritants at the moment, tensions in the US-Turkey relationship are manifold and have been accumulating for years".

Turkey, home to the Incirlik air base which is used by USA forces in the Middle East, has been a North Atlantic Treaty Organisation member since the 1950s.

Trump on July 26 threatened to impose "large sanctions" on Ankara if the government did not immediately let Brunson leave Turkey.

The Trump administration has in recent months imposed sanctions against Turkey, Iran and Russian Federation, creating what has been dubbed an "axis of the sanctioned".

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