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Begin New Search Topic Financial Crisis Political Geography Middle East

1. Mitigating the Political Cost of Financial Crisis with Blame Avoidance Discourse: The Case of Turkey

Author:
Büşra Söylemez-karakoç
Publication Date:
08-2024
Content Type:
Journal Article
Journal:
Uluslararasi Iliskiler
Institution:
International Relations Council of Turkey (UİK-IRCT)
Abstract:
How do centralized governments mitigate the political cost of severe financial crises? The economic voting scholarship has established that the clarity of responsibility, i.e., government accountability for economic conditions to the mass public, is a necessity for electoral reward or punishment for economic performance. On the one hand, political centralization, which reduces the number of veto players, may increase the visibility of the role of the executive in policy success or failure. On the other hand, it allows an uncontested blame avoidance discourse, especially when accompanied with democratic backsliding. Furthermore, the recent backlash against globalization has enabled blame shifting to international actors in many countries. Against this theoretical framework, we comparatively analyze the responsibility attribution discourses for the 1994, 2001, and 2018-2022 financial crises in the statements of incumbent presidents, ministers, and parliament members of Turkey. We find that while blame avoidance discursive strategies have been attempted in all three cases, the responsibility attribution for the 1994 and 2001 crises mostly targeted the executive. In contrast, for the ongoing crisis, the responsibility discourse is dominated with blaming international political economy factors, creating ambiguity, and targeting domestic non-governmental actors.
Topic:
Economics, Globalization, Politics, Financial Crisis, Voting, and Democratic Backsliding
Political Geography:
Turkey and Middle East

2. Financial Turmoil, Uncertainty, and Institutions: Turkey’s Political Economy in Crises

Author:
Serhan Yalçiner
Publication Date:
12-2024
Content Type:
Journal Article
Journal:
Uluslararasi Iliskiler
Institution:
International Relations Council of Turkey (UİK-IRCT)
Abstract:
Financial turmoil damages national and global economies, but the causes of financial crises vary, with a combination of financial and political factors creating them. By asserting that every financial crisis necessarily involves political aspects, this study aims to certify that the poor policy response of Turkey, which has relied heavily on a “president over institutions” approach, has contributed to the ongoing severe currency and debt crises. Focusing on the two predominantly domestically induced crises of 2001 and 2018, this article analyzes secondary literature and data to put forth a framework that combines the fiscal policy response with a look at the country’s institutional strength and shows how financial uncertainty and instability exacerbated the conditions of the ongoing 2018 crisis. The study also finds that deteriorating political institutions in Turkey, marked by a lack of governmental efficacy that has led to compromised financial and fiscal sustainability, has played a considerable role in the onset of the 2018 crisis.
Topic:
Political Economy, Financial Crisis, Authoritarianism, Institutions, and Democratic Backsliding
Political Geography:
Turkey and Middle East

3. CPR for the Turkish Economy: The 2001 Financial Crisis and its Aftermath

Author:
W. Robert Pearson
Publication Date:
02-2024
Content Type:
Journal Article
Journal:
American Diplomacy
Institution:
American Diplomacy
Abstract:
On February 19, 2001, at a formal government meeting, the president of Türkiye, Ahmet Necdet Sezer, accused the prime minister, Bulent Ecevit, of incompetent management of the country’s banking system and threw a copy of the Turkish constitutional code book across the table at him. The prime minister stormed out, called a press conference, and verbally attacked the president. Immediately, the stock market panicked, the lira plunged, and interest rates skyrocketed. My wife Maggie and I were celebrating a belated Valentine’s lunch that day. An embassy colleague rushed in to say the Turkish lira was crumbling. I called the prime minister and urged him to buy lira with Turkish reserves as fast as possible. He ignored my advice and by day’s end the lira was in the basement. Overnight, the savings of many ordinary citizens were devastated, and millions of dollars of value had vaporized. The causes of the collapse were many. Türkiye had experienced high inflation throughout the previous decade. The government had run large deficits and funded them with high interest bonds that avoided short-term defaults. The increased borrowing and growing public debt created a dangerous economic risk. The Turkish banking sector faced significant issues, including inadequate regulations, poor risk management, and high levels of non-performing loans. Many banks had debts that were difficult to collect. Türkiye depended greatly on foreign borrowing to finance its economic growth, but, as economic imbalances worsened, changes in investor sentiment added to concerns. Foreign investors withdrew over $70 billion from 2000 to 2001 as the economic situation deteriorated.
Topic:
Diplomacy, Financial Crisis, Economy, and Memoir
Political Geography:
Turkey and Middle East

4. The Egyptian Financial Crisis: Implications for the region, and for Israel too

Author:
Eran Lerman
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
Egypt continues to play an active role in regional affairs, including the Aqaba emergency meeting on the Palestinian situation (February 26) and the ongoing effort to prevent escalation in Gaza. At the same time, Cairo is in the middle of a significant financial crisis. The effects of the war in Ukraine – specifically, grain shortages – brought the Egyptian pound to more than 30 to the dollar, up from 20 in November and 15 in early 2022, facilitated by deliberate government action in response to demands by the IMF. Inflation still soars, and so does youth unemployment. All this could destabilize a nation of 105 million on our border, with dire consequences.
Topic:
Financial Crisis, Conflict, Fiscal Policy, and Financial Stability
Political Geography:
Africa, Middle East, Israel, Egypt, and MENA

5. Cash Cabal: How Hezbollah Profits from Lebanon's Financial Crisis

Author:
Samara Azzi and Hanin Ghaddar
Publication Date:
06-2023
Content Type:
Policy Brief
Institution:
The Washington Institute for Near East Policy
Abstract:
In March 2020, Lebanon opted for a “hard default” on $32 billion in sovereign debt, allowing the government to avoid negotiating with its Eurobond holders and investors. Beirut thereafter showed little interest in addressing the consequences of default, and the country’s economic meltdown worsened. As usual, the Lebanese people were the casualties, suffering amid what the World Bank has called a “deliberate depression.” This official negligence has cleared the way for a proliferating cash economy—which in turn has spawned a currency exchange scheme involving the central bank, foreign exchange agents, and Lebanese politicians. Hezbollah specifically has profited in areas ranging from real estate to solar energy, pharmaceuticals, and the illicit Captagon trade. In this Policy Note, authors Samara Azzi and Hanin Ghaddar—a venture capitalist and a former Lebanese journalist—skillfully diagram the corrupt status quo and explain why entrenched actors want to avoid systemic change. But as the study makes clear, the future health of the Lebanese economy requires an overhaul, and the international community must now press for deep reforms and personal accountability.
Topic:
Politics, Non State Actors, Financial Crisis, Economy, Hezbollah, and Shia Islam
Political Geography:
Middle East and Lebanon

6. Can the Lira be saved?

Author:
Fadi Nicholas Nassar and Mike Azar
Publication Date:
03-2023
Content Type:
Video
Institution:
Middle East Institute (MEI)
Abstract:
MEI's US-Lebanon Fellow Fadi Nicholas Nassar speaks to Beirut-based international finance professional Mike Azar on Lebanon's financial crisis. What is the state of Lebanon's banking system, and how did it become so dysfunctional? What does Azar recommend to get Lebanon's economy back on track, and can the Lira be saved?
Topic:
Financial Crisis, Economy, and Banks
Political Geography:
Middle East and Lebanon

7. Lebanon in Crisis

Author:
Randa Slim and Edward M. Gabriel
Publication Date:
03-2022
Content Type:
Video
Institution:
Middle East Institute (MEI)
Abstract:
Randa Slim and Amb. Edward Gabriel discuss the daunting trifecta of economic, financial, and political crises Lebanon currently faces and what they anticipate for the country's future.
Topic:
Financial Crisis, Political Crisis, and Economic Crisis
Political Geography:
Middle East and Lebanon

8. Economic Diplomacy: The impact of Russia’s growing role on the Lebanese crisis

Author:
Nawar Samad
Publication Date:
07-2021
Content Type:
Commentary and Analysis
Institution:
Future for Advanced Research and Studies (FARAS)
Abstract:
A Russian business delegation visited Lebanon in late June 2021 to offer support to the country by cultivating projects in the oil sector, development plans for the energy industry as well as the ports in Beirut and Tripoli. For the past two years, Lebanon, which is going through the worst economic and financial crisis in its history, and has been trying to secure international aid to survive, is now facing the attractive Russian economic bailout offer. Although such an offer is welcomed by Lebanon, the Russian initiative raises concerns across the West, and particularly in the United States, which is in control of Lebanon’s banking system and still has significant influence on the state’s politics and financial sector. The United States believes that it is not possible to dissociate this Russian offer from Moscow’s desire to expand its influence in a region, in which it already established military presence and gained access to the Eastern Mediterranean, where a conflict is underway over investment of newly-discovered gas fields.
Topic:
Diplomacy, Economics, Financial Crisis, and Gas
Political Geography:
Russia, Eurasia, Middle East, and Lebanon

9. Lebanon’s Pandemic in Context

Author:
Ziad Abu-Rish
Publication Date:
06-2021
Content Type:
Special Report
Institution:
Center for Contemporary Arab Studies (CCAS)
Abstract:
ADF Fellow Ziad Abu-Rish takes a deeper look at COVID-19’s spread in Lebanon and how it intersects with the country’s ongoing crises.
Topic:
Poverty, Financial Crisis, Crisis Management, Unemployment, Public Health, Pandemic, and COVID-19
Political Geography:
Middle East and Lebanon

10. The Eye of the Storm

Author:
George G. Namur
Publication Date:
01-2020
Content Type:
Journal Article
Journal:
Harvard Journal of Middle Eastern Politics and Policy
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Lebanon is in the throes of an unprecedented crisis in its modern history. Starting 17 October 2019, the people of Lebanon have been protesting in the streets in a broad-based uprising. This paper highlights key post–civil war realities and practices that led to the country teetering and proposes a solution package to what ails the country and threatens its future.
Topic:
Corruption, Financial Crisis, Governance, Social Movement, Revolution, and Political Crisis
Political Geography:
Middle East and Lebanon