Turkish Minister Simsek Privately Criticizes Lira Savings Scheme
- New economy boss expresses strong dislike of KKM program
- Simsek says he’d terminate program when resources allow
Customers use automated teller machines in Ankara, Turkey. The Turkish lira has lost 28% of its value against the dollar so far this year, one of the worst performances in emerging markets.
Photographer: Moe Zoyari/BloombergTurkey’s Treasury and Finance Minister Mehmet Simsek expressed strong criticism of the nation’s flagship lira savings tool during a private meeting with foreign investors on Thursday, according to people familiar with the discussions.
Creating the so-called KKM program, or “FX-protected lira deposit accounts,” was a bad idea that has created significant challenges, Simsek said. The program was designed to encourage more savings in Turkish liras rather than foreign currencies by guaranteeing returns on lira deposits that compensate for any potential exchange-rate losses.