Turkish Lira Tumbles As Erdogan Sworn In, Changes Central Bank Law

As Turkey completes its transition from a parliamentary model to an all-powerful presidency, the Lira has tumbled, erasing overnight gains, following reports that Recep Tayyip Erdogan – sworn in as Turkey’s first executive president – has issued a decree changing central bank governance laws.

Having fired 18,000 civil servants over the weekend, Erdogan is scheduled to take the oath of office at the Grand National Assembly in Ankara at 4:30 pm (1330 GMT), as Turkey completes its transition from a parliamentary model to an all-powerful presidency.

As DPA reports, the radical changes were approved by a razor-thin majority in an April 2017 constitutional referendum.

Erdogan will become both the head of state and government, with the prime minister’s post abolished. He will have sweeping new powers, including over the judiciary and the ability to rule by decree.

On the campaign trail, the opposition repeatedly warned of “one-man rule,” but Erdogan’s motto was steadfast: “A great Turkey needs a strong leader.”

His mandate under the executive presidency makes him solely responsible for cabinet and vice presidential appointments.

Under the new system, cabinet ministers cannot be members of parliament, so they would have to give up their seats.

Hours before the swearing-in, Turkey issued two new executive decrees, reworking past legislation on ministries, including merging some of them, as part of the transition to the new system.

Under the new decree, Erdogan has removed the ‘Governor advice’ clause from the CBRT laws (and removes the five-year term limit for CBRT governors), basically enabling Erdogan to directly appoint central bankers for life without any oversight.

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Author: Tyler Durden

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