The International Monetary Fund (IMF) didn't ask to borrow money from Turkey, former Central Bank head Durmuş Yılmaz said to refute President Recep Tayyip Erdoğan's claim. "This is a lie. The issue is technical. In short, the IMF didn't ask to borrow money from us. A commitment was made to a contingency fund and it wasn't realized. The proof: There is no such record on the Central Bank balance," Yılmaz tweeted on Aug. 11.
The IMF has released an update of its World Economic Outlook, in which it projected the global economy contracting by 4.9 percent in 2020, a downward revision from its April forecast of a 3 percent contraction. As for Turkey, the organization has not changed its projection of 5 percent contraction in GDP.
No matter how long or short the COVID-19 crisis lasts, a broad range of working masses, but especially the unskilled labor force will be the ones exceedingly affected. They will lose income and their jobs. As a result, inequality will spread on a mass scale and poverty will soar.
Felicity Party leader Temel Karamollaoğlu has accused the ruling Justice and Development Party (AKP) of planning to rig the next elections. "I'm saying that they will rig the elections. Understand it as you please. They'll intervene in the number of votes, because they did so in the past. They killed people near ballot boxes," he said, referring to the killing of two Felicity Party members during March 31, 2019 local elections.
Zeitgeist Turkey | Episode 7: As Turkish lira weakens to beyond 7 against dollar Erdoğan faces a choice
Duvar English’s editor-in-chief Cansu Çamlıbel and pollster Can Selçuki are joined by political economist Esen Çağlar to discuss the underlying factors behind the accelerating loss of value of the Turkish lira against the dollar. They look for answers to how the Turkish government is caught between a rock and a hard place by rapidly selling the Central Bank reserves. They also discuss whether Ankara can secure a swap line from the U.S. without giving up Russian S-400s.
Upon asking whether or not Turkey should borrow from the IMF in order to alleviate the economic effects of the coronavirus crisis, only 30.8% of participants agreed, while the remaining 69.2% disagreed. The fact remains that the IMF is still negatively connoted amongst Turkish people.
Turkey is in dire need of a source of external funding granted through a credible international institution in order to combat the economic impact of the coronavirus, according to a research of five Turkish economists. The study said that although a swap agreement with the U.S. Federal Reserve as well as the IMF could help Ankara to battle the crisis, the arrangement of a swap line alone would likely be insufficient.
Since the COVID-19 crisis erupted, Turkish Central Bank’s reserves fell nearly 20 billion dollars. Now, the thought of “Can there be a swap line opened from the U.S. Central Bank Fedreserve ?” is in question.
DEVA Party leader Ali Babacan has said that Turkey shouldn't rule out borrowing loans from the international institutions, saying that it should choose cheap IMF loans over high-cost borrowing from markets. "Turkey has the right to use them with unconditional 1 percent interest. Instead of going to the markets and paying 7 percent, we can get loans from these institutions with 1 percent," he said.
Turkey was caught with the coronavirus outbreak at a time when it was weak structurally. Just like in the COVID-19 epidemic, the underlying disease story is the story of those problems in economy which were “swept under the carpet” for a long time. Turkish government's economy policies after 2018 were based on bans, limitations and covering up of the symptoms rather than resorting to necessary steps to solve the problems.
Turkey will send medical aid to Israel and Palestine to help them battle coronavirus, Presidential Spokesman İbrahim Kalın said on Sunday. He added that Armenia’s medicine demand was also approved by President Erdoğan.
Today Turkey’s crisis is not only a health crisis followed by the coronavirus outbreak and an economic crisis triggered by it. Rather, it is a health crisis and an economic crisis triggered by it, on the top of an already ongoing economic crisis due to foreign currency debts of non-financial corporations. Cookie cutter applications of what may work elsewhere will not work in Turkey.
Turkey has held talks with the United States about possibly securing a swap line from the Federal Reserve and has discussed other funding options to mitigate fallout from the coronavirus outbreak, anonymous Turkish officials told Reuters on April 10. “Aside from the IMF, Turkey is looking at every kind of option for resources and is involved in various contacts,” one of the Turkish officials said.
Turkey is not among the non-EU emerging economies in Central and Eastern Europe that has applied for emergency assistance from a $50 billion pool available via the IMF’s rapid financial support facilities, the organization’s European Department Director Poul M. Thomsen said.