The exchange rate between the Turkish Lira and the US Dollar is deteriorating heaviliy to the disatvantage of the former, indicating a currency crisis.
United World International expert Mehmet Perinçek gave an interview to the Iranian newspaper Tehran Times on the crisis, its historical background and geostrategic dimensions.
Below we present the interview, which can also be read here. Subtitles were set by UWI.
TEHRAN – A Turkish historian and political scientist blames liberal policies for the crash of Turkish the lira against the U.S. dollar.
“One of the most important reasons for Turkey’s lira crash is the neoliberal policies implemented in Turkey for many years,” Mehmet Perincek tells the Tehran Times.
“While liberal policies destroyed Turkey’s productive powers, it also made the Turkish economy dependent on hot money and dollars.”
Once again, Turkey is in the throes of a currency crisis. The lira has lost more than 40 percent of its value against the United States dollar this year, making it the worst-performing of all emerging market currencies.
In November alone, the lira lost nearly 30 percent of its value against the dollar – landing it well into currency crash territory.
“If you cannot produce the products and goods you need yourself, you have to outsource them. This makes the dollar, which is used as a reserve currency in the world, even more, valuable against your own national currency,” Perincek emphasizes.
“Besides, the dominance of the dollar in the Turkish market allows foreign powers to carry out operations against the Turkish economy.”
Following is the text of the interview:
Q: What are the main reasons for the crash of Turkey’s lira to a new low against the U.S. dollar?
A: One of the most important reasons for Turkey’s lira crash is the neoliberal policies implemented in Turkey for many years. While liberal policies destroyed Turkey’s own productive powers, they also made the Turkish economy dependent on hot money and dollars. If you cannot produce the products and goods you need yourself, you have to outsource them. This makes the dollar, which is used as a reserve currency in the world, even more, valuable against your own national currency. Besides, the dominance of the dollar in the Turkish market allows foreign powers to carry out operations against the Turkish economy.
“This is an ecomomic war”
Q: Erdogan has described the currency crash as an economic war? Do think this is a war? If so, who wants to undermine Turkey’s economy?
A: Yes, this is an economic war, because the USA uses the dollar as a weapon. With this weapon, it collapses the national economies of countries that have become dependent on the dollar and create the ground for them to surrender. These developments in Turkey are directly related to the economic operation carried out by the USA.
Turkey is resisting and even disrupting Washington’s plans in Syria, the eastern Mediterranean, the Aegean, and the South Caucasus. Because in the last 5-6 years, Turkey’s breaking away from the Atlantic and taking its place in Eurasia has clearly changed the balances in the region. For this reason, the success of the USA’s plans in our region depends on Turkey’s kneeling down and disintegration. The only way to achieve this is to completely paralyze the Turkish economy by dollar operations.
“The sanctions of the U.S., which have turned into a crime against humanity, should not be imposed.”
Q: Some other countries in the region like Iran and Lebanon have also witnessed a fall in their currencies. What is your opinion?
A: The USA does not just use missiles and bombs as weapons. One of the biggest weapons of the USA is economic sanctions. Through economic sanctions, Washington punishes countries that do not conform to the American order.
The inhuman dimension of these sanctions should also be seen. Millions of people are unable to meet their most basic needs because of these sanctions. This is one of the cruelest aspects of sanctions policy.
In fact, it is not only the governments and people of those countries that are punished. The whole world suffers from this. Because there are other countries, trading with those countries that the USA wants to destroy. For example, the sanctions imposed on Iran also hit Turkey and harm the Turkish manufacturers. Or Turkey is deprived of the opportunity to buy cheap energy from Iran. On the other hand, Germany is one of the countries that suffered the most from the sanctions imposed on Russia.
“The US intends to collapse national economies using the Dollar as a weapon”
For this reason, American sanctions are destroying not only the countries to which they are applied but the whole world.
Q: Turkey witnessed protests against Erdogan’s policies in recent days. What are the repercussions of these protests in the country? Do you expect any change in Erdogan’s policies?
A: As I said, the USA intends to collapse the national economies with the dollar weapon and then organize colorful revolutions by using the dissatisfaction of the people. They wanted to implement these plans in countries such as Iran and Venezuela. However, they failed. They will fail in Turkey either.
However, the Erdogan government should not give such an opportunity to the United States. The immediate rescue of the Turkish economy from its dependence on the dollar; supporting Turkish producers from industrialists to peasantry; allocating Turkey’s resources to production, not rent; state administrators embracing simple life and putting an end to waste are needed. But the most important of all is state planning and the state’s effectiveness in the economy.
If these are done, the USA will lose its chance to intervene in the Turkish economy, and the dissatisfaction of the people is prevented from being used for its own purposes by foreign powers.
Q: How can regional countries join hands to pass this tough period?
A: First of all, the dominance of the dollar must come to an end. The countries in the region transfer resources to the USA every time they trade with dollars. And it gives the United States an opportunity to intervene in their economy. The countries of the region should trade between themselves in national currencies.
The sanctions of the U.S., which have turned into a crime against humanity, should not be imposed and the regional economy should be revived by establishing even common markets. In addition, it is very important to open transportation and energy routes that will improve regional trade.
Regional countries need to cooperate
The countries of the region should establish regional peace and energy security with cooperation. The conflicts between the countries of the region or the civil wars in the countries cause the greatest damage to the regional economy. In this respect, the countries of the region should also stand against the U.S. provocations.
The pandemic process has also clearly shown that the neoliberal economy has gone bankrupt in the world. On the other hand, even Western economists admit that the center of the world economy has shifted from the Atlantic to Eurasia. Therefore, there is no reason why the countries of the region should not solve their economic problems when they come together.