Wednesday, October 28 2020 19:00
Alina Hovhannisyan

Expert: The ban on the import of Turkish goods to Armenia will be a  drop in the bucket for Turkey, but it will still have an impact

Expert: The ban on the import of Turkish goods to Armenia will be a  drop in the bucket for Turkey, but it will still have an impact

ArmInfo. The ban on the import of Turkish goods to Armenia for Turkey, even if it is a "drop in the bucket", will still have an impact. Economist, former mayor of  Yerevan Vahagn Khachatryan said this at a press conference on October  28. The expert conditioned his opinion on the existing difficulties  of the Turkish economy.

In particular, he noted that the embargo by Armenia does not have  such a significant impact on the Turkish economy, as a similar  decision on the part of Saudi Arabia, whose trade turnover is $ 3  billion (with Armenia, the trade turnover is about $ 270 million),  nevertheless it will lead to certain economic difficulties. Saudi  Arabia not only stopped importing Turkish goods, it was also decided  to close and sell off its business in Turkey. Moreover, about 1.3  million tourists from Saudi Arabia visit Turkey annually, which on  average will spend about $ 15 billion for tourism purposes. <In  addition to this, it can be noted that 40% of hotels, due to the  epidemiological situation, are not loaded with tourists, which is  fraught with more serious problems, "he said.

Khachatryan noted that the Turkish economy has been in crisis for the  last 3-4 years, which is deepening more and more. This is due, among  other things, to military actions, entailing crazy costs. In view of  the policy pursued by the authorities, according to the economist,  there is an outflow of investors in Turkey.  Last year alone, their  number fell by 40%. To all these facts, one can add the devaluation  of the Turkish lira. In addition, to date, Turkey's total national  debt has exceeded 60% of GDP.

''Erdogan took over the duties of the head of the Central Bank, and  ordered to issue cheap money. But this is possible only if there is a  machine that prints dollars and euros, and if there is none, then the  local currency is not enough for such a policy, and today's response  to such actions is devaluation, "Khachatryan explained.

He also noted that Moody's and Fitch downgraded Turkey's ratings,  bringing it to the level of countries such as Uganda and Rwanda. Due  to the lack of independence of the Central Bank, many organizations  have no desire to work with Turkey.  <That is, even this $ 270  million matter for Turkey and play their role, "he stressed.  To  note, the World Bank (WB) and the International Monetary Fund (IMF)  predict a deeper decline in the Turkish economy for 2020 than in  Azerbaijan's GDP. According to the June forecasts of the global  economic outlook for 2020, the Turkish economy will sag by 3.8%  according to the WB estimates, and according to the IMF's  expectations, the decline will be more - by 5%.  It is pertinent to  note that these forecasts were made long before the military actions  of Azerbaijan, with the support of Turkey, against the Republic of  Artsakh, which began on the morning of September 27 and are ongoing.  It is easy to assume that taking these events into account in the new  forecasts of the World Bank and the International Monetary Fund will  further aggravate the negative expectations for the economies of  Turkey and Azerbaijan for 2020, as a result of which the prospects  for 2021 may be revised towards a long- term recession. 

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