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Main opposition to pay damages to ex-minister for questioning $128 bln missing forex reserves

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Turkey’s main opposition Republican People’s Party (CHP) has been ordered to pay damages to President Recep Tayyip Erdoğan’s son-in-law and former finance minister Berat Albayrak, under whose watch the country’s forex reserves dropped sharply, for questioning $128 billion sold from the central bank’s reserves in 2019-2020, local media reported on Friday.

Although Erdoğan and his monetary policymakers had tried to downplay the issue, the public, experts and the opposition parties, especially the CHP, had called on Erdoğan and his Justice and Development Party (AKP) government to explain what happened to the central bank’s $128 billion in foreign reserves.

The main opposition CHP turned “Where’s the $128 billion?” into a political slogan after the central bank used vast sums to try and support the lira when it fell to historic lows against the dollar and euro over the past three years.

The unorthodox policy began around the 2019 municipal elections and was ramped up in 2020, when the pandemic exposed the lira’s vulnerability and Turkey’s reliance on external funding.

According to a written statement released on Twitter on Friday by Albayrak’s lawyer, Sinan Göktaş, an İstanbul court ordered the CHP to pay TL 60,000 ($3,580) in damages to the former finance minister for slander and libel.

“As stated in … the petition, there is no possibility that the central bank’s resources in any amount in foreign currency or Turkish lira will be transferred to a different location, destroyed or evaporate. …  As a matter of fact, this slander, which is the subject of such a big and organized lie, was eliminated … and the CHP … was found to be unjust … at the end of the judicial proceedings,” Göktaş said.

The lawyer added that the damages in the amount of $3,580 paid to Albayrak would be donated to the Turkish Veterans and Relatives of the Martyrs Foundation.

Albayrak has frequently been blamed for the deterioration of the Turkish economy when a decline in the value of the Turkish lira, nearly 30 percent in 2020 under his ministry, led to higher inflation via imports priced in hard currencies.

The CHP first posed the question “Where’s the $128 billion?” about the sales in February 2021, prompting Erdoğan to defend the legacy of his son-in-law, who had overseen the policy, claiming that a significant part of the forex reserves was used to enable the country to overcome the pandemic with minimal damage.

“They’re hung up on where the money is. The money is in the people’s Treasury and the central bank. Nothing was lost,” Erdoğan also said on March 10, 2021, in reference to the opposition politicians.

However, Erdoğan’s remarks didn’t reflect the truth, media reports said at the time, since the central bank’s net forex reserves were at their lowest level since 2003 of $10.68 billion as of April 2, according to bank data, and its outstanding swaps stood at $41.116 billion, which meant the reserves were in deeply negative territory once the swaps were deducted.

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