Erdogan replaces finance minister as Turkey’s lira crashes

Business News

A woman changes Turkish lira for USD and Euro at a currency exchange shop, in Ankara, Turkey, Tuesday, Nov. 23, 2021. The Turkish currency weakened by nearly 10% against the U.S. dollar Tuesday, a day after President Recep Tayyip Erdogan insisted there would be no turning back from his unconventional policy of cutting interest rates despite high inflation. The lira plunged to a record low of 13.44 against the dollar before recovering some of its losses. It was trading at 12.51 against the dollar in the late afternoon — down 9.9% from Monday’s close. The currency was trading at 14.08 against the euro. (AP Photo/Burhan Ozbilici)

ANKARA, Turkey (AP) — Turkish President Recep Tayyip Erdogan appointed a new treasury and finance minister Thursday after the previous one stepped down as the country’s currency has tumbled to record lows.

Erdogan named deputy minister Nureddin Nebati to the post, according to an announcement published in the Official Gazette. It said Lutfi Elvan asked to be “pardoned from the job” and that his request was accepted.

His resignation comes as the Turkish lira has been plummeting to successive all-time lows over concerns about the government’s economic policy. The lira’s plunge follows a series of cuts in borrowing costs despite soaring consumer prices that have made it difficult for people to buy food and other products.

The Turkish currency has lost about 40% of its value since the start of the year.

Erdogan strongly argues that high interest rates cause inflation — contrary to conventional economic thinking — and has made clear that the country would press ahead with rate cuts.

Nebati, 57, who has a doctorate in political science and public administration, is known to be a supporter of Erdogan’s drive to reduce interest rates even with inflation running at around 20%.

Nebati said Thursday that high interest rates would not be a “priority.”

“We will experience a process in which steps are taken within the scope of policies that are determined by our president,” the state-run Anadolu Agency quoted him as saying as he took office in a brief ceremony.

The president also has dismissed three central bank governors since 2019 over differences on interest rates, raising concerns about its independence.

Elvan, who stepped down as finance minister, had himself replaced Erdogan’s son-in-law, Berat Albayrak, who resigned last year.

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