Power companies hit with Turkish currency deprecation

Power companies hit with Turkish currency deprecation

Mubasher: The Central Bank of Turkey has recently asked people to borrow in the local currency, which is struggling against the US dollar.

The warning may have come too late for the country’s energy companies, as reported by Bloomberg, after they plowed billions of dollars into new power generation, distribution projects and deals over the past 15 years.

The falling lira means that some utilities are earning less per year than what they have to repay in foreign-currency loans, especially as prices are tied to long-term contracts.

The Turkish currency lost 69% of its value against the USD since the beginning of 2010.

President Recep Tayyip Erdogan is blamed for the economic uncertainties that affected his country in recent years.

Especially as about $51 billion of the $95 billion debt still needs to be repaid, which represents 15% of the $340 billion national reserve.