Turkey’s opposition party leaders criticized the “economic model” supported by President Recep Tayyip Erdoğan, who believes high interest rates cause high inflation — the exact opposite of conventional economic thinking — as the lira’s historic slide continued on Friday.
Erdoğan, who subscribes to the unorthodox belief that lower rates will fight inflation, boost economic growth, power exports and create jobs, has dismissed three central bank governors who opposed his “economic model” since 2019.
Kemal Kılıçdaroğlu, leader of Turkey’s main opposition Republican People’s Party (CHP), on Friday said in a tweet that he spoke over the phone to Simone Kaslowski, a Turkish businessman of Italian origin and president of the Turkish Industrialists and Businessmen’s Association (TÜSİAD), and asked him to speak up about the country’s lira crisis worsening by the day.
“Are we going to watch a person who has lost his mental faculties drive the country to suicide?” the CHP leader said, referring to Erdoğan, and added: “Everyone should speak up now, everyone! We want [early] elections.”
Kılıçdaroğlu vowed to end the economic “tyranny” of the ruling Justice and Development Party (AKP) government if the CHP comes to power in the next elections, accusing the former of having “no shame” and “no heart.”
“Today the lira lost 10 percent of its value. The stock market lost 10 percent of its value. So an ordinary person investing in lira lost nearly 20 percent [of his money]. Why? Because he trusted domestic currency and domestic companies. Erdoğan, how can people invest [in lira] by trusting you on this?” Meral Akşener, İYİ (Good) Party leader and Kılıçdaroğlu’s election ally, also tweeted.
“You ruined people’s families. … Your people are calling on you now, listen to them. [They say], ‘Enough is enough! Get off of our backs!’” Akşener said, addressing Erdoğan, and urging him to step down from office.
Mustafa Sarıgül, leader of the Party of Change in Turkey (TDP), said in a statement to the press on Friday that Erdoğan and the country’s other economy officials are either unable to grasp the true depth of the lira crisis or pretend that they are.
“Turkey is becoming poorer every minute. … We call on Erdoğan once again: Guarantee that you will provide an economic environment based on the rule of law and transparent institutions and rules, that you won’t act against the markets, and that you won’t harm the independence of the central bank,” he added.
Sarıgül warned that otherwise, the rapid loss in value of the lira against the US dollar would result in an economic crisis that would force companies and workplaces to shut down and trigger public protests.
Imprisoned Kurdish leader Selahattin Demirtaş, former co-chairperson of the pro-Kurdish Peoples’ Democratic Party (HDP), blamed the lira crisis on Turkey’s executive presidential system of governance, underlining that nothing other than an early election could solve such an issue.
Through a referendum in April 2017, Turkey switched from a parliamentary system of governance to an executive presidential system, which granted Erdoğan and his ruling Justice and Development Party (AKP) sweeping powers, criticized for removing constitutional checks and balances and thus leading to a further weakening of Turkish democracy.
“The situation is dire. Early elections should be held immediately before the country completely collapses,” Demirtaş said in a tweet posted through his lawyers.
The Turkish lira continued to hit fresh lows on Friday after the central bank cut interest rates on Thursday for the fourth successive month as part of Erdoğan’s so-called “economic war of independence,” hitting 17.17 to the US dollar.
The currency has shed more than half its value since the start of the year — and 30 percent in the last month alone — as policymakers bow to Erdoğan’s wishes to bring down borrowing costs despite rising inflation.