Northern Cypriots take to the streets over falling lira

PAINFUL PLUNGE::Turkey’s currency crisis has seen the lira lose 25% against the US dollar over a month, pushing power prices up 50% and making imports unaffordable

AP, NORTHERN NICOSIA, Northern Cyprus

Sat, Sep 08, 2018 - Page 10

Hundreds of Northern Cypriots took to the streets of ethnically divided Nicosia on Thursday to protest huge hikes in the prices of electricity, fuel and other goods sparked by the sharp devaluation of the Turkish lira.

Holding banners and chanting slogans decrying the hardship besetting blue-collar Northern Cypriots, protesters ended a march organized by a coalition of trade unions near the Northern Cypriot Assembly of the Republic to voice their disgruntlement.

Northern Cypriots use the lira as their official currency and its devaluation of about 40 percent against the US dollar has hit them hard by severely diminishing their purchasing power. For example, electricity prices have risen 50 percent since February, while the price of imported goods has almost doubled.

Protester Kemal Gucveren told reporters that the crisis is Turkey’s doing and no fault of Northern Cypriots, who should be left to decide their future for themselves.

Northern Cypriots declared independence nearly a decade after the island was split in 1974, when Turkey invaded following a coup by supporters of union with Greece. Only Turkey recognizes the breakaway north, and it has propped up its economy to the tune of 500 million euros annually to cover a budget shortfall.

Turkey also keeps more than 35,000 troops in the north. Although Cyprus joined the EU in 2004, only the internationally recognized southern Republic of Cyprus enjoys membership benefits.

Northern Cypriot Chamber of Commerce President Turgay Deniz said that Northern Cypriots have no choice but to depend on Turkey and to use its currency, as Ankara bankrolls all major infrastructure projects, and acts as a conduit for trade and commerce with the rest of the world.

“Everyone was in shock, because no one expected the devaluation of the Turkish lira to be at this level,” Deniz said in an interview. “Everyone expected a quick recovery and now they’re waiting to see how low it will go.”

The IMF on Thursday urged Turkish authorities faced with a falling currency and surging inflation to pursue “sound” economic policies to stabilize the situation.

However, the government in Ankara has not requested financial support from the global crisis lender, IMF spokesman Gerry Rice told reporters.

“We continue to monitor developments closely,” he said.” Again, I want to be clear, there has been no request from Turkey for an IMF financial program.”

The crisis has hammered the nation’s currency, which has lost about 25 percent over the past month, and pushed inflation last month to a 15-year high.

Additional reporting by AFP