Relative calm abroad, confidence crisis at home
While Chancellor Merkel and President Erdogan disagreed on Libya and East Med drilling rights during her visit to Istanbul, Merkel said Germany is willing to support efforts to build shelters in northern Syria for refugees displaced by fighting in Idlib.
Since the Turkish state lender Halkbank refuses to defend itself at the Manhattan federal court trial on charges of violating Iran sanctions, the prosecution team offered the bench to impose a penalty of $1 million per diem for each “diem” Halkbank failed to show up. The bench will probably levy a much smaller fine.
The Turko-Russian alliance is not delivering any results in Syria or Libya. How Erdogan intends to handle this relationship without losing Syria shapes up as one of the biggest challenges of the near future, but we still don’t rule out a military campaign to defend Idlib City, as refugees pile up at our borders.
A bitter and dry winter in the Western parts of the country finds Turkey in the midst of a confidence crisis, which we expect to deepen. Turkish citizens aren’t sure about the presidential system, lack trust in the Republic’s institutions, believe the media is lying to them and express deep pessimism about the future. Major changes in polls may be afoot.
It was a relatively uneventful week on the economy front. We just look at a few numbers inside, such as the consumer confidence index and the so-called IMF-defined budget data. We also share some confusions on the broader state of the economy as well as economic management because we genuinely fail to see how the current state of affairs could possibly be sustained through 2023.
Cosmo thinks Turkey being too far removed from the epicenter of coronavirus, it might positively decouple from EM this week.
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