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Erdogan Calls On Developing Countries To Trade In Local Currencies | The Precision

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Turkish President, Recep Tayyip Erdogan
Countries from the so-called “D-8” group of
developing nations should trade with each other in their local
currencies, Turkish President Tayyip Erdogan said on Friday, to
alleviate the forex pressure inherent in dollar-based trade. 

“If
we are to use local currencies for trade within the D-8, our currencies
will be rid of the pressures from foreign exchange and the dollar,”
Erdogan told a summit of the eight developing nations, which is being
held in Istanbul. 
“When we trade with our national and local currencies, our countries will benefit from this,” he said. 
The
D-8 Organisation for Economic Cooperation includes Bangladesh, Egypt,
Indonesia, Iran, Malaysia, Nigeria, Pakistan and Turkey. 
Turkey
and Iran’s central banks have already formally agreed to trade in their
local currencies, a move to help reduce the cost of currency conversion
and transfer for traders. 
Such agreements also
help Iran’s efforts to avoid unilateral U.S. sanctions, which remain
intact despite the lifting of international financial sanctions on
Tehran last year. U.S. banks are still forbidden to do business with
Iran. 
European lenders also face major
problems, notably with rules prohibiting transactions with Iran in
dollars – the world’s main business currency – from being processed
through the U.S. financial system. 
Erdogan has
been on a push to increase local-currency trade to avoid further
weakness in the lira currency. The lira has weakened about 4 percent
against the dollar this year, after double-digit declines in the
previous two years. 
 
Reuters

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