Greek businesses monitoring Turkey interests as lira plunges

Greek companies with billions of euros of investments in Turkey are closely monitoring developments in the neighbouring country as its currency marks record lows against the U.S. dollar, signalling a full-blown crisis, the Greek Reporter said Friday.

The ailing lira has shed as much as 25 percent since the beginning of last week due to what analysts are calling reckless interest rate cuts urged by President Recep Tayyip Erdoğan.

The country is now facing a second currency crisis in just three years. The lira has lost about 40 percent of its value since the beginning of the year,  and 32 percent against the euro.

Greek investment holding Fourlis has said the company might pull out of Turkey, but has stopped short of making a decision, it said, adding that the company has already trimmed the number of Intersport branches it operates in Turkey from 23 to 12, citing weak economic performance.

In recent years, Greek companies have been actively investing in recent years in Turkey’s $720 billion economy, despite the tensions between Ankara and Athens, the Greek Reporter said.

The stock of direct investments from Greece is around $6.8 billion mostly in information technology (IT), agricultural applications, packaging, plastics, pharmacy, cosmetics, fisheries, tourism and construction sectors,  according to Turkey’s Foreign Ministry.

Inversely, Turkey’s stock direct investments in Greece, including investments made via other European countries, registers at approximately $500 million, with Turkish investors focusing on investing in investing in marinas, ports and the overall tourism sector in the neighbouring country.

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