PM: Economic effects of coup attempt not greater than Russian jet crisis

Prime Minister Binali Yıldırım has evaluated the effects of the coup attempt on July 15, saying the damage has not been greater than was faced after the Russian jet crisis. Yıldırım admitted that the coup attempt has caused some damage to the economy, however he notes that damage remains limited to a decline in stock market values and the depreciation of the Turkish lira. The prime minister maintains his optimism, saying these fluctuations will return to normal in a few days.

After Turkey downed a Russian warplane for violating its airspace near the Syrian border on Nov. 24 , the furious Russian government responded by announcing sanctions on Turkey. A blockade on Turkish food imports at Russian border gates on Jan. 1 was echoed by calls from Moscow for Russians to stop visiting Turkey, and this resulted in the launching of investigations into Russian tourism agencies organizing tours to Turkey. Russia refused to issue work permits for Turkish citizens and called for an end to visa-free travel.

The foreign trade volume between Turkey and Russia soared from $26.2 billion in 2010 to $31.2 billion by the end of 2014; marking a 17.3 percent growth. That growth reversed after the Russian jet crisis. While Russia was Turkey's seventh-largest import partner in 2014, as of May it ranks 20th. For the first five months of this year, Turkey's exports to Russia fell by nearly 75 percent, a dramatic drop compared to the same time period in 2014.

However, despite losing this valuable trade partner during the crisis, Turkey reached a growth level of 4.8 percent for the first quarter of 2016.

Comparing the effects of the attempted coup with the tense period that came in the wake of the Russian jet crisis, Yıldırım said that Turkish officials are evaluating the damage. "It is obvious that our economy is facing setbacks. I say this to give you my opinion about the extent of the damage. The volatility in economic figures has been equal to the volatility we experienced after the jet crisis with Russia. We have not experienced a change that would turn our economy upside down."

Yıldırım also said that global investors should not worry and should continue to invest in Turkey. "We cannot ignore the coup attempt," said Yıldırım, stressing that the Turkish economy is strong enough to overcome this coup attempt. He noted that his government will continue to support investments to ensure substantial economic growth.

On July 14, the day before the coup attempt, the Turkish lira was traded at 2.9034 against the U.S. dollar. The lira peaked at 3.0501 on Friday night and reached a historic high of 3.0963 against the dollar after the government announced a state of emergency on July 20. Just yesterday, the lira was being traded at 3.0284 against the dollar.

The Borsa Istanbul BIST 100 index has begun to recover, regaining some of its value Monday, reaching 73,848 in the first session, a 2.46 percent increase.