Turkey Increases Tariffs on US Products

Turkey Increases Tariffs on US Products

Troy Powers
August 16, 2018

In response to Trump's tariffs, Turkish officials said they will impose a 50 percent tax on USA rice, 140 percent on spirits, 60 percent on tobacco and 120 percent on cars while increasing duties on a variety of other goods.

Turkish Vice President Fuat Oktay said that the tariff hikes were ordered "within the framework of reciprocity in retaliation for the conscious attacks on our economy by the U.S. administration".

The lira has dropped over 40 percent against the USA dollar so far this year.

Following the announcement, the lira firmed briefly to 5.8699 from 6.04 to the us dollar, but later eased back to 6.0200 at 1538 GMT.

The hikes were published in Turkey´s Official Gazette in a decree signed by President Recep Tayyip Erdogan, who has repeatedly described the crisis as an "economic war" that Turkey will win.

The escalating feud between the longtime North Atlantic Treaty Organisation allies is playing out against a backdrop of economic tumult in Turkey, which has seen steep drops in the country's currency, the lira.

Andrew Brunson's continued detention with charges of terrorism and espionage was cited as the basis of USA sanctions on two Turkish ministers on 1 August, which was followed by a doubling on 10 August of United States tariffs on Turkish steel and aluminium to 50% and 20% respectively.

On Tuesday, he said Turkey would boycott United States electronic products. Though it was unclear how the boycott would be enforced or encouraged.

But a gift from Qatar on Wednesday of $15 billion in direct investment has helped buoy the currency. Turkey will continue talks with the United States if it shows a constructive stance to resolve the diplomatic row, Ibrahim Kalin said, adding that no discussions were planned.

Turkey and Qatar - which is also a very close USA ally - have become close economic and political partners in recent times.

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"Turkey responds to the recent US sanctions with additional tariffs worth of 533 million dollars", state-run Anadolu agency quoted Turkish Trade Minister Ruhsar Pekcan as saying.

The move by Turkey's Gulf ally offered further support to a lira rally after the Turkish central bank tightened liquidity and curbed selling of the currency.

Qatar's banking sector has considerable exposure to Turkey, whose currency has lost almost 40% this year.

In a Wednesday phone conversation with Erdogan, the German chancellor expressed her country's commitment to strengthening its cooperation with Turkey through reciprocal visits at the highest levels, Turkey's Anadolu Agency quoted presidential sources as saying.

The paper said the feud between Turkey and the USA was "escalating".

Turkey and Qatar have traditionally maintained good ties and Ankara stood by Doha after Saudi Arabia and other Arab states severed diplomatic, trade and travel ties with Qatar past year, accusing it of financing terrorism, a charge Doha denies.

Bar owner Burhan Coban said consumer and distributor prices for American whiskey are the same, for now, despite the currency plunges and the new Turkish tariffs.

Brunson works as a pastor at the small Izmir Resurrection Church and leads a congregation of around two dozen.

Turkey said it would not be strong-armed into releasing Brunson, whose second appeal for release was rejected on Wednesday.

That's according to Turkish state media, which also reported a higher court will likely review the appeal.