Turkey: How Russia-Ukraine war could set back recent economic gains

Turkey's economy has been taking a beating in recent years, it's fair to say.

The Ukraine-Russia conflict is likely to be a further blow to the country's finances, wiping out whatever small recovery had been made.

MEE spoke to many Turks who fear this is just the beginning of more woes:

There are many causes for concern: the closure of airspace in Ukraine, the fear that Turkey will not maintain its neutral stance in this conflict, as well as the memories of 2015, when Turkey downed a Russian jet for allegedly violating Turkish airspace, triggering a political and economic crisis with Russia. 

“This war will be a huge blow to us,” Nizamoglu said, fearing that Russian state employees were now no longer allowed to leave their country. 

But it's not just the tourism sector in Turkey that will be stung by the fallout of the war. 

On Thursday, Turkey’s trading markets woke up with a shock as Russia launched a full-scale invasion of Ukraine. The stock exchange fell by more than nine percent, while the Turkish lira (TRY) suffered a more than five percent loss against the US dollar.

This agitation in the markets came at a time when Turkey had been struggling to stabilise the lira and prevent inflation hikes through the introduction of several economic measures, tax reductions and state subventions.

Turkey: How Russia-Ukraine war could set back recent economic gains