Why Pakistanis are buying up the Turkish lira

The currency won't buy much - if anything - in Karachi or Islamabad, but Pakistanis rally at exchange markets to push back against the US

The currency won't buy much - if anything - in Karachi or Islamabad, but Pakistanis rally at exchange markets to push back against the US

KARACHI, Pakistan – They may be thousands of kilometres apart and share minimal trade ties, but a Pakistani campaign is encouraging people to show their support for Turkey as it goes through rough times.

The Turkish economy has lost more than 45 percent of its value this year over worries about President Recep Tayyip Erdogan’s influence over the economy, his repeated calls for lower interest rates in the face of high inflation and worsening ties with the United States.

To cap it off, after US President Donald Trump doubled steel and aluminum tariffs earlier this month in retaliation for Turkey’s refusal to release an imprisoned US pastor, the lira went into freefall.

For many Pakistanis, that meant one thing: Buy lira.

Shoaib, an IT worker based in Karachi, said he used part of his savings to buy 300 Turkish lira ($50) to show his unwavering support.

“I am Pakistani by birth, but I am Turkish by heart

- Shoaib, IT worker in Karachi”

“Many people are unaware that the Pakistani flag is derived from the Ottoman Empire, this is why I feel so strongly about Turkey,” he said, pointing to a framed insignia of the Ottoman coat of arms. “I am Pakistani by birth, but I am Turkish by heart.”

Ibrahim, who was at a currency exchange market in Islamabad, said: “I do not have words to describe the bond between the people of Pakistan and Turkey. You tell me of any other leader that has spoken in our parliament three times, nobody has graced our assembly on this level.”

Dozens of Pakistanis have followed a call from civil society actors earlier this month to buy up Turkey’s currency, even as their own country heads towards yet another IMF bailout.

The amounts they have bought are minimal, between 125 and 300 liras on average, according to dealers who spoke with Middle East Eye. And there is very little, if anything, they can buy in Pakistan with the currency.

Billboards of former Pakistani PM Nawaz Sharif, Tajikistan President Emomali Rakhmon and Turkish President Recep Tayyip Erdogan for an economic summit in Islamabad last year (AFP)

But the two countries are both at odds with the Trump administration, which cut $255m in aid to Pakistan earlier this year, saying the south Asian country had given sanctuary to militant groups launching attacks in Afghanistan. This shared frustration at the United States is fuelling the campaign to buy lira, said analysts. 

“Pakistan and Turkey share many commonalities and faltering economies is one of the strongest denominators. The main connection at this moment in time is both countries are on President Trump’s radar,” said Sikander Lodhi, a Lahore-based journalist.

Lodhi said Pakistanis were particularly inspired after Trump announced the doubling of the tariffs against Turkey on 10 August.

I have just authorized a doubling of Tariffs on Steel and Aluminum with respect to Turkey as their currency, the Turkish Lira, slides rapidly downward against our very strong Dollar! Aluminum will now be 20% and Steel 50%. Our relations with Turkey are not good at this time!

— Donald J. Trump (@realDonaldTrump) August 10, 2018

Shoaib, the IT worker agreed: “You have to understand: this is a symbolic protest against the USA, whether my contribution or others impacts the economy is an entirely different matter."

But beyond challenging the US, there are other factors behind Pakistani support for Turkey, including devout Muslims in both countries who identify with one another and share similar causes.

“What really draws these two nations together is Turkey being vocal on issues such as Palestine and other massacres in the Muslim world,” said Nazir Hussain, professor of international relations at Quaid-i-Azam University in Islamabad.

Hussain also said that, in the past, Turkey has offered Pakistan support without requiring anything in return. "Not many people know, but Turkey was instrumental in assisting Pakistan during the 2005 earthquake," he said.

Many of the "Buy lira" events were supported by Jamaat-e-Islami, a socially conservative Islamist political party in Pakistan, which Hussain said explained their backing of the campaign.

“Turkey is an ardent supporter of the Muslim Brotherhood, the Muslim Brotherhood is having strong support across the Muslim world especially now in Pakistan with Jamaat e Islami,” he said.

“It was natural that Jamaat-e-Islami would come out in support of Erdogan and the Turkish people, these religious parties have a natural affinity and strong bonds of friendship.”

A lira customer at an exchange shop in Karachi's Clifton neighbourhood (MEE/Suddaf Chaudry)

There’s even a historical precedent: during the Turkish War of Independence from 1919 to 1923, Muslims in the British Raj - the area of British control of the Indian subcontinent which included territory that would later become Pakistan - sent financial aid to the declining Ottoman Empire.

Ibrahim Qazi, an international affairs commentator based in Lahore, said that "the inspiration came from our Qatari brothers. We accept there is minimal trade with Turkey, but this campaign is a gift for Turkey with the hope for progress.”

The campaign, he added, has entered a new phase, calling on Pakistanis to boycott US products. “We are gearing towards supporting Turkish products from diapers to apparel. We will buy in favour of Turkey,” he said.

While analysts and participants agreed the campaign was unlikely to shore up Turkey’s economy on its own, the moment has seemingly opened the possibility for further engagement between the two countries.

On behalf of the people of Pakistan & myself, I want to let President Erdogan & the people of Turkey know we are praying for their success in dealing with the severe economic challenges confronting them, as they have always succeeded against adversities in their glorious history.

— Imran Khan (@ImranKhanPTI) August 14, 2018

Erdogan has asked Pakistan to join a new economic bloc with Russia, Iran, and China to combat US sanctions. Newly elected Pakistani Prime Minister Imran Khan has sent Erdogan messages of support.

Many believe the rise of Erdogan and Khan could represent a new paradigm in Muslim leadership - one that will not succumb to US pressures so easily.

However, with trade dwindling and budget deficits to contend with, Pakistan's capacity to challenge the status quo remains up in the air.