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Berat Albayrak was Turkey’s finance minister for nearly five years, now President Erdogan’s son-in-law resigns. Cite health problems as the reason, but there could be more.
The Turkish President’s son-in-law Recep Tayyip Erdogan surprisingly announced his resignation as finance minister on Sunday. Due to health problems and because she wants to spend more time with her “abandoned” family, she leaves her position, announced Berat Albayrak on her Instagram account. Turkey is in the midst of a serious currency crisis.
“After holding ministerial positions for almost five years, I made the decision not to continue in my position (as finance minister) due to health problems,” said Albayrak’s position. The 42-year-old took over as finance minister in 2018 after having been energy minister for three years. Albayrak is married to Erdogan’s eldest daughter, Esra.
The Turkish lira is losing value drastically
It is not yet clear whether Erdogan will accept the resignation of his son-in-law. When Interior Minister Süleyman Soylu announced his resignation earlier this year, Erdogan did not accept it. Soylu later withdrew his resignation: today he is still Turkey’s Interior Minister.
Albayrak’s withdrawal came just a day after the removal of Turkey’s central bank director Murat Uysal. According to a presidential decree published on Saturday, Uysal has been replaced by former Finance Minister Naci Agbal. Uysal only took office in July 2019.
Uysal’s firing and Albayrak’s resignation come at a time when the Turkish lira is in the middle of a slump. The lira has depreciated dramatically in recent months. On Friday night, 8.52 Turkish liras were trading at one dollar. Since the beginning of the year, the Turkish currency has lost almost 30 percent against the US dollar.
Turkey is fighting record inflation
Markets expressed concern about persistently high inflation and the sharp decline in Turkey’s foreign exchange reserves. In addition, the country is going through an economic crisis. Despite the economic situation, the Turkish president is opposed to a rate hike. Last weekend, Erdogan declared that Turkey is fighting a “diabolical triangle of interest rates, exchange rates and inflation.” Erdogan believes that interest rate hikes will increase inflation, rather than slow it down, as prevailing economic theory says.
In September 2018, the key Turkish interest rate was at an all-time high of 24 percent; the central bank wanted to curb record inflation and the falling rate of the lira. Since then, the bank has gradually lowered the interest rate. In October, however, the central bank was expected to raise the main interest rate, but no decision was made.
