Turkey's Treasury and Finance Ministry said the new economic steps would be aimed at securing economic growth of three to four percent in 2019 and at tackling inflation. The lira traded down ahead of the announcement.

At one point on Friday, August 10, 2018, the Turkish lira traded at over 6.3 to the US dollar, but has since recovered a little.
At one point on Friday, August 10, 2018, the Turkish lira traded at over 6.3 to the US dollar, but has since recovered a little. ( Reuters Archive )

Turkish Treasury and Finance Minister Berat Albayrak is set to announce on Friday a "framework for a new economic model", the ministry announced on Thursday.

The much-anticipated announcement comes as the Turkish lira traded to an historic low against the US dollar early on Friday, but later recovered some ground.

The new set of economic steps are aimed at securing an economic growth of 3-4 percent in 2019 and decreasing the inflation rate to single-digits, the ministry said.

"It is expected that current account deficit would be balanced around 4 percent," the ministry said.

The ministry added that it will continue to take steps to cut the budget deficit to around 1.5 percent of the country's GDP.

"The Treasury's debt rollover ratio to be reduced below 100 pct," the ministry said.

The statement also mentioned the ministry targeted a non-interest surplus of 5 billion Turkish liras ($927.3 billion) by end of 2018 through savings and income-generating measures.

The Turkish banking system is capable of managing financial fluctuations effectively thanks to its strong capital structure and balance sheet, according to the ministry statement.

In a statement, Turkish Treasury and Finance Ministry said the new set of economic steps were aimed at securing an economic growth of three to four percent in 2019 and decreasing the inflation rate to single digits.

"It is expected that the current account deficit would be balanced around four percent," the ministry said.

The ministry added that it would continue to take steps to cut the budget deficit to around 1.5 percent of the country's GDP.

"The Treasury's debt rollover ratio will be reduced below 100 percent," the ministry said.

The statement also mentioned the ministry targeted a non-interest surplus of $925 million (5 billion Turkish liras) by the end of 2018 through savings and income-generating measures.

Turkey's lira

The lira traded down on Friday ahead of Albayrak's announcement, at one point falling to 6.3 to the US dollar before recovering ground. The lira has lost around 30 percent of its value against the dollar this year.

TRT World's senior business producer Mobin Nasir explains the reasons behind the lira's drop.

Moves in the value of the lira have in part resulted from tension between Turkey and the US.

The US has refused to extradite Fetullah Gulen, the head of the FETO terrorist organisation, while voicing support for an American pastor charged with terror-related offences.

The NATO allies are also at odds in Syria, where the US continues to back the YPG, the Syrian arm of the PKK terrorist group.

A Turkish delegation was in Washington earlier this week to address the issues, and is expected to brief President Recep Tayyip Erdogan. 

No concrete results were announced after the DC meetings, but the US state department said the conversations would continue. 

TRT World's Andrew Hopkins has more from Ankara.

Source: TRT World