Turkey said Wednesday it is increasing tariffs on imports of some US products, escalating a feud with America which has helped trigger a currency crisis.
The Turkish government said it will impose extra tariffs on imports of products including rice, vehicles, alcohol, coal and cosmetics. Tariffs on American cars were doubled to 120%, while tariffs on alcoholic drinks soared to 140%.
Overall, the duties will amount to 533 million dollars (£417 million), a relatively small sum meant as retaliation for US president Donald Trump’s recent decision to double tariffs on Turkish steel and aluminium.
Turkish vice president Fuat Oktay said on Twitter that the tariffs on certain products were increased “within the framework of the principle of reciprocity in retaliation for the deliberate economic attacks by the United States”.
The tariffs come a day after President Recep Tayyip Erdogan said Turkey would boycott US electronic goods, singling out iPhones.
He suggested Turks would buy locally-made or Korean devices instead.
The Turkish lira has dropped to record lows in recent weeks, having fallen some 42% so far this year.
It recovered by 5% to around 6.05 lira per dollar on Wednesday, after the government took steps to shore up the currency by reducing the daily limit in bank foreign currency swap transactions.
Meanwhile, Turkish officials said Qatar had pledged 15 billion (£11.7 billion) of direct investments for Turkey, in a bid to help the economy.
The officials said Qatar’s Sheikh Tamin bin Hamad Al Thani pledged to “quickly implement” the investment package during a meeting with Mr Erdogan in Ankara.
Presidential spokesman Ibrahim Kalin later confirmed the pledge on Twitter, saying: “Turkish-Qatari relations are based on solid foundations of true friendship and solidarity.”
Also helping the Turkish currency are moves by Turkey to gain favour with European countries.
As part of this, Ankara decided to release two Greek soldiers from prison. Then, on Wednesday, Amnesty International’s honorary chairman for Turkey, Taner Kilic, was freed from prison pending the outcome of his trial on terror charges. Mr Erdogan has also held a phone call with German chancellor Angela Merkel and planned to speak this week also with France’s Emmanuel Macron.
Fundamental concerns about the economy persist, however.
Investors are worried that about Mr Erdogan’s control over the central bank and his pressure to keep it from raising interest rates. Higher rates would slow economic growth, which he wants to encourage, but are urgently needed to support the currency and tame inflation, experts say.
The currency drop is particularly painful for Turkey because it has accumulated a high debt in foreign currencies.
Attention will turn to an address on Thursday by the finance minister to foreign investors for clues on any change in economic policy.
Mr Erdogan has reacted to the financial instability by blaming foreign powers, in particularly the United States, a longtime Nato ally, which he says is waging an “economic war” as part of a plot to harm Turkey.
Washington has imposed financial sanctions on two Turkish ministers and doubled steel and aluminium tariffs on Turkey, as US president Donald Trump tries to secure the release of Andrew Brunson, a 50-year-old American pastor being tried in Turkey on espionage and terrorism-related charges.
On Wednesday, a court rejected an appeal for Mr Brunson’s release from detention and for a travel ban against him to be lifted, the state-run Anadolu Agency reported. A higher court is scheduled to review the appeal.
Although he was released to home detention, Mr Brunson faces a prison sentence of up to 35 years if he is convicted on both counts at the end of his ongoing trial.
The evangelical pastor, who is originally from Black Mountain, North Carolina, has lived in Turkey for 23 years and led the Izmir Resurrection Church.