With Turkey’s currency, the lira, falling to record lows, Turks have been thrown into a currency crisis which has resulted in the prices of imported everyday items rising. Yet tourism from Britain is rising due to a favourable exchange rate that has made holidays in Turkey cheaper than usual. In light of this, should Turkey be your next student-friendly holiday so that you can experience rich culture and beautiful beaches without a hefty price-tag? Are there benefits to Turkey’s economic slump that should be reaped by tourists?
Firstly, there are many reasons which have contributed to the fall of the lira in recent years. The diplomatic crisis between the USA and Turkey has threatened to become an economic crisis after the USA imposed an asset freeze on two Turkish officials, which resulted in retaliation from the Turkish government on two members of Donald Trump’s cabinet. Along with the US doubling the tariff of steel and aluminium in Turkey, this resulted in the fall of the lira to record lows against the US dollar for six consecutive days.
President Erdogan has opposed higher interest rates to combat the high inflation rate at 15% and excessive borrowing, claiming that they ‘make the rich richer and the poor poorer’
The increase in debts for Turkish companies, especially as Turkish debts that were borrowed in pounds and euros due to lower interest rates, have increased due to the currency drop. Expensive imports such as fuel and food paired with the increase in company debts have resulted in higher inflation for Turkish consumers.
President Erdogan has opposed higher interest rates to combat the high inflation rate at 15% and excessive borrowing, claiming that they ‘make the rich richer and the poor poorer’. In fact, appointing his son-in-law as finance minister resulted in a sharper drop of the lira, which, not only hit Turkey, but also emerging economies such as Argentina and South Africa.
As the cost of imports for Turks rose, the price of its exports dropped dramatically. As a result, tourism in Turkey has flourished as the currency has fallen by almost 40% since last year. British package holidays company TUI has reported that Turkey has once again become the most popular holiday destination for Brits, while Thomas Cook has reported a 63% rise in booking for holidays to Turkey. In short, savvy Brits have taken advantage of the low currency and have started booking last minute holidays to Turkey, making it one of the most popular holiday destinations in 2018.
As the Turkish lira is low against the dollar and European currencies, the cost of spending money in Turkey has also dropped since last year
Despite warnings by the British Home Office to only visit Turkey for essential travel due to its proximity to the border of Syria, tourists have been flocking to its attractive beaches and historical sites. As the Turkish lira is low against the dollar and European currencies, the cost of spending money in Turkey has also dropped since last year.
Although Turkey has been thrown into an economic crisis, its once-struggling tourism industry is booming as record numbers of Europeans book last-minute holidays to the sunny country. High inflation, loss of confidence in businesses and growing debts continue to plague the nation, exacerbated by Turkey’s leader who refuses to raise interest rates as a possible solution to the economic crisis. As a result, the Turkish lira has continued to plummet, thus rejuvenating the tourism industry for last-minute holidays for both foreign students and families alike.