Qatar decides to support Turkey with US$ 15 billion investment as lira continues to lose value against dollar

Qatar decides to support Turkey with US$ 15 billion investment as lira continues to lose value against dollar
Posted on: 6 Sep 2018

As the conflict between USA and Turkey continues and the Turkish lira fails to stop losing value Turkey has received a meaningful support from Qatar, its reliable ally in the Gulf region.

After talks in Ankara between the emir of Qatar, Sheikh Tamim bin Hamad Al-Thani, and Turkey’s President Recep Tayyip Erdogan, Qatar promised to invest US$15 billion into Turkish financial markets and banks which would apparently not please US President Trump who has started a trade war against Turkey due to the dispute over Turkey’s detention of an American pastor on some security charges.

The USA believes these charges are baseless and Turkey should have freed the pastor by now and thus Donald Trump has decided to use the economic power of the USA to make Turkey kneel down and send over the pastor to the USA, by imposing sanctions and new additional taxes on Turkish import goods.

This strategy has had more impact than it would normally do as Turkey has already been going through a difficult period in terms of economy and the lira has been in a downward trend for a while.

It is right at this point that Qatar has shown solidarity and decided to side with Turkey defying the American strategy against this country by announcing it would invest US$ 15 billion in the Turkish financial sector. It is no doubt while doing this Sheikh Tamim bin Hamad Al-Thani, the emir of Qatar, has also taken the risk of suffering the rage of Donald Trump as Qatar is dependent on Washington for both military and political protection, being a US ally.

Just to recall, the USA increased tariffs on aluminum and steel imports from Turkey, by two fold while Turkey launched a boycott on US electrical products and sharply increased tariffs for other US imports. All this happened as the lira lost approximately 40 percent against the dollar in 2018 so far based on worries over Erdogan’s growing influence on the economy and his refusal to raise interest rates despite high inflation.

Turkey and Qatar have been close economic and political partners for quite a while now and Qatar has a US$ 20 billion investment in Turkey, not to forget Turkey is one of the emirate's largest exporter as well. Moreover, Sheikh Tamimi was the first foreign leader to call Erdogan after the failed coup attempt in Turkey in 2016 and Turkey is among the few countries to support Qatar against the boycott by the Saudi-led group of Gulf countries over allegations of financing terrorism.

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