Erdogan wants trade with Russia, China in local currencies

ANKARA: Turkish President Recep Tayyip Erdogan said his country was moving towards allowing trade with Russia, China and Iran to be conducted in local currencies, as he continues his efforts to strengthen the falling lira.

“We are taking steps towards trading with Russia, China and Iran with local currencies,” he said, ahead of a trip by Turkish Prime Minister Binali Yildirim to Russia for meetings on Tuesday.

“If we buy something from them, we will use their money, if they buy something from us, they will use our currency,” Erdogan explained.

He added that instructions related to this proposal had been given to the central bank and previously said that discussions were underway with Moscow, Beijing and Tehran on the issue.

Erdogan repeated a call for Turks to convert the euros, dollars and other foreign currency “under their pillows” into Turkish lira during a speech in the central city of Kayseri.

“Our Turkish lira is blessed,” he told a cheering, flag-waving crowd after opening a museum in the city named after his predecessor and long-time friend Abdullah Gul.

Praising Turks for heeding his words, he said: “My people began to change whatever they found under their pillow within three or four days.”

The government hopes that such actions and demands will help the lira win back the losses it has suffered over the past few months since a failed coup in July when a rogue military faction tried to oust Erdogan from power.

In November alone, the lira haemorrhaged more than 10 percent while it continues to reach record lows against a stronger US dollar. The lira on Friday reached a record low of 3.58 before making up some of the loss.

Meanwhile, the government slashed its growth forecast to 3.2 percent from 4.5 percent for this year as the political turbulence and terror attacks in the past year take their toll.

Hours after the president’s first mention of changing currencies to lira, the Istanbul Exchange said it would convert its cash assets into lira “in support” of his call.

Meanwhile, Metro Holding’s chairman Galip Ozturk said on Twitter that he would give a free ticket to use on Metro Tourism buses to anyone who changed $500 to lira and sent an image of the official receipt to a phone number he provided.