Hard-hit Russian economy may affect Turkey

Fall of purchasing power in Russia may impact tourism in Turkey, says head of Union of Chambers and Commodity Exchanges

Hard-hit Russian economy may affect Turkey

World Bulletin/News Desk

While low oil prices are beneficial for Turkey's current account deficit, the effects on the Russian economy may also bring certain disadvantages, said Rifat Hisarciklioglu, head of the Union of Chambers and Commodity Exchanges in Turkey, on Tuesday.

Hisarciklioglu said tourism and foreign trade in Turkey could be affected by plunging oil prices hitting the Russian economy, which is based on energy exports, hard.  

"It has been said before that Russia had $500 billion in reserves but (...) because of low oil prices, its purchasing power has decreased," he said.

The global benchmark Brent crude oil price has decreased nearly 50 percent since June, and has stabilized at around $60 per barrel this week. The Russian ruble took a major fall last week, losing more than 20 percent of its value in a single day. Although the currency has since managed to make modest gains, it still remains at lows not seen since 1998.

Russia has also suffered from a rapidly deteriorating economy wracked by international sanctions and massive capital flight. 

According to Hisarciklioglu, the situation that Russia is currently facing can have negative indirect effects on Turkey, namely a decrease in the number of Russian tourists and with regards to exports of agricultural goods and manufactured products.

The number of Russian tourists visiting Turkey in 2013 amounted to more than 4 million. Russians constitute the second biggest tourist group in Turkey, after Germans, according to the Turkish Ministry of Culture and Tourism.

 

Last Mod: 24 Aralık 2014, 11:30
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