What Erdogan Told Us About Rates, Gulenists, and the Kurds
It’s been 10 weeks since an attempted coup failed to unseat Turkey’s President Recep Tayyip Erdogan. Since then, the country has returned to relative stability. Erdogan has jailed—and released—thousands, purged swathes of civil society, and he’s fighting to get an opponent he blames for the rebellion extradited from the U.S.
In an interview with Editor-in-Chief John Micklethwait, Erdogan discussed issues ranging from the U.S. decision to back Kurdish forces in Syria, to the rebellion and its aftermath and his own economic outlook for the country. Here are the key takeaways:
He Thinks Turkey’s Central Bank Should Keep Cutting Rates
“It will be beneficial to continue this steadily,” Erdogan said.
Turkey’s central bank this week cut the country’s benchmark interest rate to 8.25 percent. Pressed on whether cutting rates is the right decision at a time when inflation is 8 percent, the Turkish president repeated his belief that lowering interest rates does not lead to higher inflation. Instead, he said that low interest rates were necessary to encourage more investment in the country.
He’s Very Unhappy With the U.S. for Arming Kurds in Syria
“By giving them weapons, you’re endangering our future,” Erdogan said of the U.S. decision to arm Kurdish forces fighting Islamic State militants along Turkey’s border with Syria.
The Turkish president said the the U.S. was wrong to give shelter to Fethullah Gulen, an aging cleric Erdogan believes was involved in the July 15 coup attempt. While the U.S. has said any extradition request must first go through its courts, Erdogan said it was a matter for Turkey to decide.
“I’m sorry, I can’t wait for the verdict to be issued by a court because this offense has not been committed in the U.S.—it has been committed in Turkey,” he said.
He Thinks Credit Ratings Agencies Are Biased Against Turkey
“I don’t care at all, they’re making mistakes and they’re doing it intentionally,” Erdogan said after a series of ratings firms downgraded Turkey over the summer.
S&P Global Ratings cut the country’s rate after the attempted coup, and Fitch Ratings last month lowered its outlook to negative.
Erdogan said the firms weren’t making decisions based on economics but political bias. “They’re raising [rates of] economies that have collapsed, that are finished,” he said. “On the other hand, they’re either freezing or going towards cutting a country that’s standing on its feet, that’s upright, and where investments are continuing.”
He Wants the Central Bank Cleared of Gulenists
“An important place like the central bank needs to be cleansed of them, it needs to be purified of them,” Erdogan said, referring to followers of the Gulen religious movement. Many of Turkey’s main institutions been through major reshuffles since the attempted coup, but the central bank appears to have survived any widespread purge.
He added: “I can’t know right now who has what kind of influence in the central bank. But if our police or judiciary have determined that there are Gulenist or FETO terrorist organization members inside the central bank, then they’ve removed them from duty, and they need to remove them.”