Erdogan says Turkey will boycott US electronic goods, including Apple’s iPhone

Key Points
  • Turkish assets are under pressure over concerns about U.S. sanctions and the economy's management.
  • Turkey's president made a televised address Tuesday, saying Turkey would boycott US electronic goods.
  • Erdogan said "If they have iPhone, there is Samsung on the other side."
A tourist takes a photograph on an iPhone near a foreign currency exchange store, center, in Istanbul, Turkey, on Monday, Aug. 13, 2018. 
Bloomberg | Bloomberg | Getty Images

Turkish President Recep Erdogan has said Turkey will boycott U.S. electronic goods, including Apple's flagship iPhone device.

Erdogan maintained an assertive stance in a speech Tuesday and claimed he had been taking necessary measures to arrest the recent slide in Turkish assets.

Speaking at a Symposium in Ankara, Erdogan said Turkish businesses must continue to produce and export the country's own goods. He added that U.S. electronics would have sanctions placed on them.

"If they have iPhone, there is Samsung on the other side. And we have our own telephone brands," he said.

"We are going to produce enough for ourselves. We have to serve better quality goods than we are importing from them," Erdogan added in a translation provided to CNBC.

Pricing for the iPhone X starts at 7,499 Turkish lira, which at the current exchange rate is around $1,143.

Turkish President Tayyip Erdogan addresses his supporters at the Presidential Palace in Ankara, Turkey, April 17, 2017.
Umit Bektas | Reuters

Erdogan also namechecked Vestel Venus phones as a home-built alternative for Turks to buy, prompting shares in that company to rise almost 5 percent.

Turkish stocks rebounded Tuesday after the country's struggling lira pulled back from record lows, sparking a Europe-wide relief rally. The currency gave up some of its gains as Erdogan spoke and at circa 5:30 a.m. ET was sitting at around 6.5160 to every dollar.

Erdogan again called on Turks to change U.S. dollars into lira in order "maintain the dignity" of the currency.

The president suggested that Turkish people would stand against dollar strength and inflation in the same way that an attempted coup of his presidency was defeated in 2016.

Turkish lira volatility won't be fixed any time soon, expert says
Turkish lira volatility won't be fixed any time soon, expert says

Turkey's economy is seen as particularly fragile due to its high level of debt that is priced in dollars. The more the lira weakens, the more expensive that debt becomes. The latest estimates from the International Monetary Fund (IMF) show that the total amount of Turkish debt payable in other currencies is more than 50 percent of the country's gross domestic product (GDP).

Investors have shown concern that the government is influencing the central bank, persuading it not to raise interest rates to a level that would slow rampant inflation.

A sell-off in Turkish assets accelerated after President Donald Trump said Friday that he would increase tariffs on steel and aluminium originating from Turkey. The tariffs are a direct attack on Turkey's refusal to free jailed American pastor Andrew Brunson.