- Created: Sunday, 31 March 2019 10:26
- Written by Trevor Rayne
The ruling Justice and Development Party (AKP) and President Erdogan have been desperately trying to stop the Turkish lira falling ahead of local elections on 31 March. The lira fell steeply in 2018, forcing Turkey to raise interest rates to 24% to try and stop the drop; the world’s fourth highest rates. With the lira tumbling, inflation is now over 20% and food prices are rising at 30%. Consumption dropped by almost 9% in the last quarter of 2018. The unemployment rate is 13.5% and that for youth is 24.5%. Against this deteriorating economic and social situation, Erdogan and his government have resorted to bizarre and racist tactics to win the elections.
Erdogan has blamed sinister Western forces for Turkey’s economic problems. During the election campaign, he showed a video taken by the Australian perpetrator of the massacres committed at the mosques in Christchurch in New Zealand. Then he issued a warning to Westerners at an event commemorating the Battle of Gallipoli in 1915, held close to the site where thousands of New Zealander and Australian troops are buried. He said that anti-Muslim Westerners would be sent home ‘in coffins’ like those killed by the Ottoman army at Gallipoli. Erdogan has played on reactionary nationalist and religious sentiment and has threatened the Kurds. He dismissed people’s concerns about food saying, ‘All this talk about tomatoes, aubergines and green peppers. Do you have any idea how much a bullet costs? Think about the cost of getting our soldiers ready to fight terrorists. And here you are talking about tomatoes and potatoes.’ Meanwhile, the AKP goes around promising more spending on infrastructure and services.
Erdogan seems to think that he can order inflation and currency speculation to disappear. He and his son-in-law finance minister Berat Albayrak ordered raids on onion warehouses and accused 12 supermarket chains of ‘treason’ and ‘terrorism’ for pushing up prices. When currency speculators noticed that Turkey’s foreign exchange reserves had fallen by $6bn, they presumed that the central bank was trying to stop the lira dropping and so they sold off lira causing it to fall by over 6% on 22 March. Erdogan lashed out, warning speculators that they would suffer a ‘very heavy price’ for ‘trying to provoke us’. Turkish authorities then launched an investigation into JP Morgan Chase, accusing the US bank of ‘misleading’ clients with advice to sell the lira. This is reckless self-destructive behaviour. Corporate debt has soared under Erdogan. Businesses have $285bn foreign currency denominated debt that becomes harder to service as the lira drops. Turkey needs flows of foreign currency or it will not be able to meet its debt obligations and its economy will implode, and here is the President, threatening JP Morgan Chase.
Prior to the election Erdogan warned that if the predominantly Kurdish People’s Democratic Party (HDP) representatives are elected they could be dismissed and be replaced with state-appointed trustees. 95 municipalities that were run by the HDP’s sister party the Democratic Regions Party have been taken over by the government and 94 elected DBP co-mayors have been arrested. We must campaign to make the British government end its support for the Turkish state and in defence of the Kurdish people’s struggle for democracy and self-determination.