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Turkey pumps brakes on car imports

Driven by some peculiar dynamics, demand for imported cars has grown in Turkey despite the coronavirus pandemic, leading Ankara to hike taxes to suppress a trend that has worsened the country’s currency woes.
A picture taken on March 30, 2018 shows the traffic jam at the Eminonu district, in Istanbul. - Uber has enjoyed growing popularity in Istanbul, and this has stoked tensions with the official taxi drivers, who have brought legal cases against the firm in Istanbul in a bid to have the app blocked in Turkey, AFP reports. Tensions have also spilt over into violence, with Uber drivers complaining of being verbally harassed, beaten up or even shot at. (Photo by OZAN KOSE / AFP)        (Photo credit should read O
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The Turkish government has enacted drastic tax measures to curb car imports as it scrambles to ease a foreign exchange crunch. The move aims to encourage the sale of locally produced vehicles, but its impact remains questionable in a country where demand for imported cars has been traditionally high.

An ongoing flight of foreign capital, coupled with a sharp decline in hard currency revenues from exports and tourism during the coronavirus pandemic, have brought Turkey’s current account deficit to some $30 billion, with Ankara losing control of foreign exchange prices despite costly efforts to keep them in check. The price of the dollar shot up more than 7% in a mere month, hitting the region of 7.35 liras in mid-August. 

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