Competition ended, multiple exchange rates began

Although the Central Bank (CBRT) introduced new rules to banks for foreign currency purchases by companies, the practices became more and more compatible with the market economy as days went by. While the last extraordinary steps of the CBRT completely eliminated a competitive market, they also ushered in the multicurrency period. Earlier in the week, the CBRT sent an order to banks to “buy the dollar at a higher rate for those with currency surpluses”, demanding that the dollar be sold to companies with currency surpluses and individual investors at 19.20 lire. . It was indicated that companies with a net foreign exchange deficit could buy foreign exchange from 19.01 lira. In addition, banks were required to report to the CBRT on a monthly basis the foreign exchange positions of companies with a loan balance of TL 5 million or more. And finally, the claim that exchange houses can make sales of more than 500 thousand dollars with the approval of the CBRT entered the agenda.

SÖZCÜ author Dr. Nedim Türkmen said: “Turkey is becoming a country where capital movements are restricted and de facto multiple exchange rates apply. This transformation will drag our country into a period in which the physical problem of currencies and exchange rates will increase disproportionately.

INSTALL EVERY COMPANY DIFFERENTLY

Türkmen stated that these steps taken by the CBRT to determine the exchange rate in the transaction between the bank and the client will seriously hinder the formation of competition in the market. Explaining that the Central Bank can approve the purchase of foreign exchange of TL 19.10 from company X and TL 19.30 from company Y, which applies to a bank for the purchase of foreign exchange, Türkmen said: “When there are In these situations, the free exchange rate regime can give approval to firm Z. It will be over. The Central Bank will be in a position to dictate and determine the exchange rate. A multi-currency period will emerge. A competitive market will disappear,” he said. .

Capitalism is no longer an illusion

Economist Dr. Mahfi Eğilmez stated on her blog that the expression of free movement of capital in Turkey is now just an illusion. Eğilmez said that the free movement of capital has been suspended, noting that Turkey is an open economy, saying, “It is not easy to keep interest and exchange rates under control for a long time unless foreign trade is suspended in the same way.” Eğilmez said: “According to the triple deadlock hypothesis in the economy; Free movement of capital, a fixed exchange rate, and independent monetary policy cannot exist at the same time.