Turkey Crisis Highlights a Better Way to Buy Emerging-Market Debt

Berat Albayrak

Turkish Finance Minister Berat Albayrak is to unveil the plan for Turkey's economy on Friday

US President Donald Trump is doubling tariffs imposed on Turkish steel and aluminum, insisting that the relationship between the two countries is 'not good'.

Turkey's financial crisis and further US pressure spurred more concern among investors as fears appeared to spread to American markets.

On Friday, Turkey's currency, the Lira, fell as much as 14%, causing the global financial markets to shudder.

Turkey's woes shook world markets, pushing down stock indexes and lifting the dollar, which traders around the world typically buy in times of concern.

The lira, which has lost a third of its value this year, fell on his comments and was trading at around 6.05 to the dollar after he spoke, almost 9 percent weaker on the day.

President Donald Trump broke the news on social media that he authorized the doubling of existing steel and aluminum duties on imports from Turkey.

"Our relations with Turkey are not good at this time!" he said in an early morning post.

Financial upheaval there risks further destabilising an already volatile region. Speaking in the northeastern province of Gumushane, Erdogan said, "Apparently, those who believe they can force us to capitulate don't know [our] people at all". The White House said he had authorized them under a section of USA trade law that allows for tariffs on national security grounds.

"Section 232 tariffs are imposed on imports from particular countries whose exports threaten to impair national security as defined in Section 232, independent of negotiations on trade or any other matter", White House deputy press secretary Lindsay Walters said in a statement.

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The party will have to seek formal support from smaller parties or independents to get elected the prime minister of its choice. Khan had been summoned by the accountability body on July 18, but had sought more time to appear due to his "busy schedule".

"Some countries have engaged in behaviour that protects coup plotters and knows no laws or justice", he said.

The United States is the biggest destination for Turkish steel exports with 11 per cent of the Turkish export volume.

Those words will further alarm many investors, suggesting that Turkey will neither impose a conventional economic programme to protect its currency nor find a way to come to terms with the U.S. over a tangle of issues that have brought them to loggerheads - chiefly, the jailing of USA missionary Andrew Brunson on terrorism charges.

Trump announced the action Friday on Twitter. The White House said he had authorised them under Section 232 of USA trade law, which allows for tariffs on national security grounds.

Turkey imposed $266.5 million in tariffs against the United States in June, targeting American imports of coal, paper, walnuts, almonds, tobacco, whiskey and machinery, amongst other items.

The diplomatic dispute with the US was one of the triggers that turned market jitters into a full-blown route this week.

The lira's slide came after a USA delegation from Washington, D.C., left Turkey without making progress toward the release of Andrew Brunson, an American pastor detained by Erdoğan's government since 2016. It came as a Turkish delegation returned from the United States, reporting no progress on negotiations involving a US pastor imprisoned in Turkey. Turkey, you see, has hurt itself with bad policies, tried to blame foreigners for this fact, but then, unbelievably, seen Trump seem to vindicate their scapegoating by trying to bring their economy down in retaliation for them bringing it down themselves.

He added: "Relations with countries who behave like this have reached a point beyond salvaging". Graham called Turkey's case against Brunson a "sham". -Turkish relations is a dispute over an American clergyman who has been jailed in Turkey since December 2016.

Erdogan enjoys the support of many Turks even though food, rent and fuel prices have all surged.

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