Experts evaluate the economic reforms announced by Erdogan in Turkey

In the context of macroeconomic stability, the economic reforms announced by Turkish President Recep Tayyip Erdogan have charted a new course for the Turkish economy, especially in the areas of inflation, the financing sector, the current account deficit, debt management, digital currencies and employment, which raises questions about their timing and form.

"We will definitely reach our goals to make Turkey one of the 10 largest economies in the world," Erdogan said in his speech during the introductory ceremony of the economic reform package in Istanbul.

The new package was preceded by a package of measures to confront Corona, called the "Economic Stability Shield" in March 2020, and 100 billion Turkish liras (nearly $ 15.5 billion) were allocated to it, as a step to contain the crisis and avoid the country recording losses.

It is noteworthy that the global economy during 2020 shrank by 3.5%, global trade by 10%, and direct international investment decreased by 42%.

Turkey has become the second country, after China, among the G20 that has managed to develop its economy, after achieving economic growth of 1.8% last year despite the repercussions of the Corona virus.

The economic package includes tax breaks for small business owners (European)

Economic reform

According to a report by the Dutch "Rabobank" for banking and financial services, the economic reforms package included market-friendly elements that could reduce inflation to low levels, indicating the importance of establishing a price stability committee that would lead to structural changes in some of the main factors affecting food prices.

As for the "BlueBay" asset management company, it said that the new economic reforms package constitutes a favorable environment for the business world and investors.

It was indicated that it would be useful in guiding and in the survival of companies that have bad financial loans.

For his part, Turkish economist Alaeddin Schinkolar believes that the economic reform provisions announced by President Erdogan are a temporary treatment and not a real surgical operation that permanently addresses economic problems.

"The Turkish economy needs to direct financial capabilities towards the areas of production, manufacturing and export in order for the country to return to economic growth and stability," Sinkular told Al Jazeera Net, but he pointed out that his country has experience and practice in getting out of economic impasse and mazes without turning into compelling crises.

The Turkish economy needs to direct financial capabilities towards the areas of production, manufacturing and export, according to Schinkolar (European)

As for economic researcher at the Aegean University in Izmir, Muhammad Ibrahim assures Al-Jazeera Net that the economic reform package is important for markets and investors, because it aims to increase the strength of the economy and combat inflation, up to the target inflation rate of 5%, according to central bank data.

He adds that achieving more stability in macroeconomic and public financial indicators will gain the economy more confidence and reduce risks, which will contribute to attracting investments and achieving stability in the markets.

Regarding the Economic Stability Shield plan announced in March of last year, Ibrahim believes it is impossible to evaluate it because it came in abnormal conditions and the beginning of the closure of the economy, pointing out that the plan in general has relatively succeeded in achieving its goal of containing the effects of the measures taken to combat the Corona pandemic, And help the economy to survive and reduce losses and negative impacts to a minimum.

Turkey has launched a digital tax department application that provides its services 24 hours a day, seven days a week (European)

Debt management

During the announcement of the economic reform package, Erdogan pointed out that the government has a strong debt management framework thanks to fiscal discipline applied for years, saying, "We will reduce the share of foreign currency debts from the total debt balance, with the aim of reducing the sensitivity of the debt stock to external shocks."

"We will mainly use Turkish lira banknotes to borrow," he added, noting that the economic package includes tax exemptions for small business owners.

In this context, the Turkish expert, Shinkular, believes that there is no clear and planned measure to manage the debts on the shoulders of the economy, markets and the Turkish citizen, pointing out that the Turkish government is trying to address the deficit by providing renewed debts for the people and companies.

For his part, economic researcher Muhammad Ibrahim believes that Turkey has faced difficulties during the past period in debt management, especially foreign debt due to the decline in "dollar" income due to the impact of the Corona virus, pointing out that the reforms related to debt management announced by President Erdogan will reduce the economy's sensitivity to external shocks. Especially since lira-denominated borrowing is easier.

The Turkish government began planning and organizing rules to control the field of digital currency within the country’s (European) economy.

Digital currencies

In the context of his speech, Erdogan revealed the launch of a digital tax department application that provides its services 24 hours a day, seven days a week, to enable citizens to pay their taxes electronically, announcing the start of preparing the infrastructure to issue laws related to digital currencies.

In turn, the Turkish Ministry of Treasury and Finance announced that it is closely following developments related to cryptocurrencies in the country.

"Within this framework, studies are being conducted under the chairmanship of the deputy minister, in cooperation with the Central Bank, the Banking Regulation and Supervision Authority, the Capital Market Authority and other institutions," she said.

Earlier, Turkish businessman Mekamel Saremsaggi announced that he intends to open up to the cryptocurrency market from Istanbul, in addition to his new projects in the real estate field.

Saremsaggi, known in the international media as "Turkish Trump", indicated that he intends to issue $ 100 million in cryptocurrencies.

He said, "I held talks with official bodies within the framework of the project, and a working group was formed in Turkey of bankers and financiers, whose mission is to work within the Turkish Stock Exchange and open up from Istanbul to investors in regions such as China, India, Russia, Eastern Europe, Africa and the Far and Middle East."

The Turkish expert, Shinkular, confirmed that his government began a year ago to plan, organize rules and set conditions in order to control the field of digital currency within the scope of the country's economy.

As for the researcher Ibrahim, he pointed out the state’s concern about digital currencies, and it seems that it is studying it well and will move towards issuing a digital currency after providing the appropriate legal and technological environment for that.