Turkey: a no-fly zone for investors

Turkey's equity market and the Turkish lira, which had fallen sharply in the wake of the country's failed coup, have recovered some of their lost ground. But the gains may not last: there is still a great deal to worry about.

A day after the failed coup attempt in Turkey, Prime Minister Mehmet Simsek tweeted that there was "no need to worry". The equity market and the Turkish lira, which had fallen sharply when the news broke, appeared to heed his advice early this week, making up some of the lost ground. But the gains may not last: there is, in truth, a great deal to worry about. For starters, Turkey's increasingly authoritarian president, Recep Tayyip Erdogan, is likely to centralise political power further, and may also be inclined to meddle even more with the economy. All of which could mean that Turkey becomes a "no-fly zone for investors a few years down the road", Bruce McCain of Key Private Bank told Bloomberg.com.

Already, the country "looks more and more like a political basket case", says Harvard's Dani Rodrik in the FT. This year alone has seen a prime minister deposed, two general elections and a wave of terror attacks. The attempted coup, moreover, is an unwelcome reminder of the military's three previous power grabs in the 1960s and 1970s.

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Andrew Van Sickle
Editor, MoneyWeek

Andrew is the editor of MoneyWeek magazine. He grew up in Vienna and studied at the University of St Andrews, where he gained a first-class MA in geography & international relations.

After graduating he began to contribute to the foreign page of The Week and soon afterwards joined MoneyWeek at its inception in October 2000. He helped Merryn Somerset Webb establish it as Britain’s best-selling financial magazine, contributing to every section of the publication and specialising in macroeconomics and stockmarkets, before going part-time.

His freelance projects have included a 2009 relaunch of The Pharma Letter, where he covered corporate news and political developments in the German pharmaceuticals market for two years, and a multiyear stint as deputy editor of the Barclays account at Redwood, a marketing agency.

Andrew has been editing MoneyWeek since 2018, and continues to specialise in investment and news in German-speaking countries owing to his fluent command of the language.