Turkish lira had gained a value of eight percent against the U.S. dollar after Fitch lowered Turkey's rating, Deputy Prime Minister Nurettin Canikli said in a live television interview on Tuesday.
Answering a question on Turkish broadcaster Bloomberg HT about Fitch's decision to lower Turkey's credit rating, Canikli explained that the lowered assessments of Turkish banking system by credit rating agencies were inexplicable.
"The Turkish banking system has passed a real-life stress test with success, and these decisions are not objective," Canikli said.
"We can say that decisions made by credit rating agencies over the last couple of months are not rational. This is part of a political project, however, they have failed to succeed. This is important because all credit agencies have emptied their magazines and have no shots left," he added.
"They were expecting the dollar to hit a historic high against the Turkish lira before Fitch lowered Turkey's rating. However, the Turkish lira has gained an eight percent value against the dollar since the ratings were released."
Canikli also said that they would grant loans to a total number of 460,000 SMEs within the scope of the "Zero-Interest Credit Support" campaign. He added that the amount of loans to be given to SMEs would range between 20,000 and 50,000 Turkish lira.
Emphasizing that the loan plan would give priority to micro-size SMEs, Canikli said, "There are currently 323,000 SMEs that meet the requirements in Turkey, which have annual revenues ranging between 1,000 and 250,000 Turkish liras. We allow them to have this opportunity."
Stressing the importance of the regulation, Canikli said, "Never in the history of the Republic has there been the implementation of such a large-scale, zero-interest credit campaign."
Turkey's Capital Markets Board to introduce new regulations for FX market
Canikli said the Capital Markets Board (SPK) will launch a new regulation against unauthorized foreign exchange transactions, noting that currency trading companies that are not authorized by the SPK will be banned from carrying out transactions. Stressing that the board will prevent such transactions with a new regulation to be introduced over the next two weeks, the deputy prime minister said, "The SPK will prevent access to institutions, websites and organizations which operate in other countries without the SPK's authorization."
He added, "No one will be able to say, 'Turkish citizens can access the website of the company which was established in accordance with the regulations of another country, and carry out transactions there.'" Stressing that it is the Turkish state which is authorized to establish the rules of transactions for the Turkish people, Canikli emphasized that the SPK will prevent access to entities which operate in other countries without its authorization.
In the case of unauthorized transactions, the SPK will warn the relevant company, informing them that "Turkish citizens are banned from accessing this website and carrying out transactions on it. Ban Turkish citizens from accessing it." Turkish citizens will then be banned from accessing these websites. Canikli said that such websites quickly change, adding that the government will trace and notify them.
$3.5 billion loss prevented
According to Canikli, had it not been for a previous currency trading regulation, Turkey would have turned into a "digital gambling house." He said a loss of $3.5 billion has been prevented for small investors since the regulation was introduced. In light of this, the board will not go back on the new regulation.
Forex transactions down $6 billion
Drawing attention to the fact that the volume of leveraged transactions reached between $16 and $17 billion on a daily basis, Canikli said that the volume of transactions had decreased to $10.4 billion as of Feb. 24. The minister noted that the average loss rate in foreign exchange transactions rose by 88 percent while the rate for small scale investors reached 98 percent. "If we had not intervened in the forex market, there would have been an army of forex victims; in fact there is now," said the minister.
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