The old Ottoman empire is gone, and we need to accept it. It has happened to others in the past. Just remember the Spanish empire covering America, Europe and Philippines…, and see Spain now. Or the British empire, still influential but losing pace every year.
Turkey has a powerful military and has been trying to be a key piece in the Middle Eastern political turmoil, supporting one or another. Perhaps it is time to focus on itself and start sending a modern, positive message of a business oriented country with a wonderful young generation.
The currency in most cases reflects the country´s situation, but to change the macro variables and the perception abroad takes time, and meanwhile, instead of lowering interest rates that only decreases the faith in the lira, a possible solution could be the creation of a currency board. It will protect the currency but it will limit the Government mobility.
With a currency board, the exchange rate and money supply is managed by an independent money authority, which more often than not, backs the domestic currency with a basket of different foreign currencies (ideally in a proportion similar to its trading).
It has been done more or less successfully in Bulgaria in 1997 (link).
