The Turkish Government announced a drastic devaluation of the lira on Wednesday (1 March) cutting its value by nearly 30 per cent against the dollar.
GV: Istanbul banking area.
SV AND CUs: Exteriors of banks. (7 shots)
SV INTERIOR: Deputy Secretary-General of Turkish Industrialists and Businessmen's Association Berk Kocer speaking in English
REPORTER: "Do you think that devaluation is good for Turkish business?"
KOCER: "Well there are no hopes for this from previous years and previous devaluations because this time the devaluation has taken with other measures, other complementary measures, and before, devaluation has always been a focus and centre point of economic measures. This time it is not, and this might help. But there must be other measures. There are already some, but fiscal proposals in the case of (indistinct) are very important. Also for this government it is important. They claim to be Social Democrats, therefore the fiscal proposals are the most important instruments of Social Democrats. They must do something about this. And in the case of Turkey fiscal proposals are very important because we have a very high rate of inflation after devaluation I believe, and this can only be controlled by fiscal policies, and also for export problems we need fiscal policies to cut the domestic demand. Turkey in the early fifties used to export eight per cent of its national product, but now this ratio is only four per cent. So we must not go on with consuming the best of products domestically, and save some goods for export if we intend to exploit the benefits of this devaluation."
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Background: The Turkish Government announced a drastic devaluation of the lira on Wednesday (1 March) cutting its value by nearly 30 per cent against the dollar. This was a key move in a package of economic measures aimed at checking the flow of imports which had drained the nation's foreign reserves. According to Reuters, the amount of the devaluation was higher than expected, and reflected the government's concern to close the huge foreign trade gap and to reopen credit lines from abroad.
SYNOPSIS: Since devaluation, a delegation from Turkey has begun negotiations with the International Monetary Fund for a credit agreement to ease the country's shortage of foreign exchange. When the devaluation was announced there was very little protest from the country's business community. Mr Berk Kocer, the Deputy Secretary General of the Turkish Industrialists and Businessmen's Association explains the importance of the new monetary policy.