Albayrak stresses Turkey’s low indebtedness as lira tumbles

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Turkish Treasury and Finance Minister Berat Albayrak said Turkey has low consumer and public borrowing compared with global averages, accusing unnamed persons of spreading “lies” about the country’s debt levels.

Albayrak spoke after the lira hit a record low of 7.39 per dollar in Istanbul on Monday. Investors and analysts have warned that a borrowing boom by consumers and businesses is causing imbalances in the economy. Albayrak did not mention corporate debt.

The minister said household debt in Turkey averaged $1,291 per person compared with an average of $6,271 globally. The country’s public sector borrowing of around $2,900 per person is one-third of the average, he said in comments published on Twitter on Monday.

Turkey’s economy would emerge stronger from the current global crisis caused by the COVID-19 pandemic, Albayrak said.

The lira has hit an all-time low partly due to concerns about the level of foreign currency debt owed by corporations. State-run banks have also led a lending splurge to help spur economic growth since a currency crisis in the summer of 2018.

The lira fell to as low as 7.4017 per dollar on Tuesday morning local time in Istanbul, extending its weakest level on record.

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