Turkey’s Finance Minister Rules Out Capital Controls as Lira Slides

(Bloomberg) -- Treasury and Finance Minister Berat Albayrak on Tuesday said it is out of the question for Turkey to even consider capital controls, brushing aside a common concern among investors at times of lira weakness.

“I would like to make it clear that there won’t be capital controls. Turkey is a finance and trade center,” BloombergHT television cited Albayrak as saying during an investor call organized by Citigroup Inc., without saying how it obtained that information.

The minister addressed around 100 companies that participated in the call, which followed weeks of declines in the lira amid rising geopolitical risks. The currency fell to 8.2037 per dollar, a record low, shortly after Turkey’s state media began reporting on Albayrak’s comments. It’s now been depreciating for nine weeks, the longest rout since 1999, according to data compiled by Bloomberg.

For authorities, the lira’s current level is sufficiently competitive to drive a recovery in the $700 billion economy. Albayrak said multinational companies already began diverting production to Turkey, which he said is at a “turning point.”

“The new economic model proved itself by raising exports to the pre-pandemic level through production, investment, job opportunities and a competitive exchange rate,” state news agency Anadolu cited the minister as saying.

©2020 Bloomberg L.P.