(MENAFN- AzerNews)
Qabil Ashirov read more Turkish President Recep Tayyip Erdogan reaps the fruit of his
successful foreign policies in hard times.
Erdogan's government played a great role in the development of
the Turkish economy which ranks in the top 20 in the world.
However, the coup attempt organized by the FETO terror group in
2016 cost dearly to the Economy of Turkiye. Following the failed
post-coup, the global pandemic and price hike on oil and gas
further deteriorated Turkish economy. Turkish currency lira has
devaluated 6 times in the last 6 years and the slump of the lira
caused inflation, which in turn raised criticism against Erdogan's
government.
In addition to these, an earthquake hit Turkiye where over
45,000 people were killed and more than 105,000 buildings damaged.
According to the World Bank, reconstruction and recovery costs may
exceed $68 billion.
Of course, all of these happenings could make it difficult for
Erdogan to win the election which will be held in a few months.
It is significant to note that, Turkiye used swaps and deposits
to cope with economic problems even before the earthquake and Saudi
Arabia is not the first country. However, the deposit agreement
with Saudi Arabiya will give some relaxation for Erdogan to
concentrate on the election.
Before Saudi Arabia Turkiye had inked swap or deposit agreements
with China for $6bn, $15 billion with Qatar, $5 billion with the
United Arab Emirates, and $2 billion with South Korea for a total
of $28 billion.
Besides, SOFAZ placed a 6-month deposit with a total value of 1
billion euros with the Turkish Central Bank. According to the local
media, Azerbaijan re-extended the time of deposit.
Saudi Arabia's report of depositing $5bn into the Turkish
central bank through the Saudi Fund for Development (SFD) intended
to gave a gimps of hope for the revival of the Turkish economy.
According to the SFD, Saudi Tourism Minister and Faund's
Chairman Ahmed Al-Khateeb signed the agreement with the Governor of
Turkish Central Bank Sahap Kavcioglu, and the deposit was made on
instructions of King Salman and Crown Prince Mohammed bin
Salman.
Despite there was no any evidence from both Saudi and Turkish
officials about how the cash would be used, we strongly believe
that the deposit surely will pave a way for either stabilization or
in the best-case scenario to boost the long-weakening Turkish Lira
against US dollar.
Besides that, by signing this agreement the Saudi Kingdom
demonstrated its confidence in the Turkish economy, which in turn
it will contribute to directing foreign investment to the Turkish
economy.
The deposit also heralds the restoration of relations between
Saudi Arabia and Turkiye, which deteriorated after the
assassination of Saudi journalist Jamal Ahmad Khashoggi in 2018 and
Turkish yearlong support to Qatar.
Given that Turkiye will hold a presidential election in a few
months, and the depreciation of the lira against the US dollars has
led to a rise in inflation, which in turn has increased criticism
against Erdogan's government, the signing of the deposit agreement
suggests that the Kingdom of Saudi Arabia is interested in Erdogan
staying in power.
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