By Sumeyye Dalkilinc
ANKARA (AA) – Lending in local currencies should be considered as an opportunity to enhance trade relations with countries like Russia and China, head of a Turkish banking watchdog said on Wednesday.
Mehmet Ali Akben, head of the Banking Regulation and Supervision Agency, told Anadolu Agency Turkish banks had already begun the framework for such a mechanism.
“It is very important to conduct trade and implement trade agreements in local currencies with other countries just like Russia and China do,” Akben said.
The Central Banks of Turkey and China concluded their first Turkish lira-yuan swap deal worth 450 million Turkish liras ($132.42 million) on Nov. 30, which was aimed at reducing reliance on the greenback.
Akben said they negotiated with Turkish banks on giving loans in ruble in the tourism sector and added that banks were working on this.
“If a Russian tourist make payments in ruble and banks give loans in ruble, that will be a trade in itself,” he said.
President Recep Tayyip Erdogan said in November that his country was planning to trade with Iran, Russia and China in local rather than foreign currencies in order to strengthen the position of the Turkish lira and reduce dependency on the dollar.
Turkish lira has lost more than 6 percent of its value against the dollar since November. Top Turkish officials, including the president have urged Turks to cash in their foreign exchange holdings and buy the lira to stem the Turkish currency’s decline.
