The economic difficulties facing Turkey have become a daily reality affecting all aspects of life (French)

Istanbul

- With the local elections approaching in Turkey, attention is turning to the critical economic situation prevailing over the country, as high inflation rates and the decline in the value of the lira cast a heavy shadow on the lives of citizens, as the economic difficulties facing Turkey are not just numbers and statistics;

Rather, it is a reality of living every day that affects all aspects of life, from the increase in the prices of basic goods, to the rise in housing and transportation costs.

Against the backdrop of these crises, the Turkish government established a new economic strategy last year, aimed at restoring stability and stimulating growth, known as the medium-term economic program for the years 2024-2026, which President Erdogan announced, defining the features of the country’s future economic policy.

The program expects the economy to grow by 4% during the current year, with the inflation rate reduced to 33% by the end of the year. It also predicts that the ratio of the budget deficit to gross domestic product will reach 6.4%, and that the unemployment rate will remain at 10.3%.

The program also sets an ambitious target for exports worth $267 billion and imports worth $372.8 billion by the end of 2024, an indication of the government’s efforts to boost foreign trade and improve the balance of payments.

Economic plans color election speeches

In the midst of election campaigns, the main parties in Turkey stand out by presenting their economic projects aimed at meeting the urgent needs of citizens, especially in major cities.

Such as: Istanbul, Ankara, and Izmir.

Murat Kurum, the People's Alliance candidate in Istanbul, revealed his economic vision that aims to address the main dilemmas facing the population.

Such as: the sharp rise in rent and transportation costs, in addition to the difficulties that young people face in getting married.

He also announced financial support for the beneficiaries of the urban transformation project to be implemented in the city, in addition to promises to build more than 650,000 earthquake-resistant apartments.

On the other hand, Ekrem Imamoglu, the candidate of the opposition Republican People’s Party and the current mayor of Istanbul, adopted an approach that focuses on strengthening the social and entertainment structure of the city, by establishing public facilities that provide educational, recreational and family services at affordable prices to all residents of Istanbul, in addition to continuing to criticize the Turkish government, Holding it responsible for the rise in prices and the exacerbation of high prices that burden citizens.

According to the latest opinion polls conducted by Tosyar regarding voters’ preferences for the next mayor of Istanbul, Murat Kurum advanced with 41.7%, while Imamoglu, the current mayor, came in second place with 40.2%.

The current administration of Turkey is in the crosshairs of criticism due to its new economic measures, which some analysts see as an attempt to gain a new achievement, by alleviating the economic difficulties faced by citizens on the eve of local elections, in steps that fall under what is known as the “electoral economy.”

For example: raising the minimum wage by 49% in the last month of last year.

The Turkish Central Bank fixed the main interest rate at 45%, while inflation reached nearly 65% ​​at the beginning of this month (Anatolia)

When will inflation decrease?

The Turkish Central Bank announced that the main interest rate was set unchanged at 45% last Thursday for the first time since May 2023, which is in line with expectations after raising the interest rate last January, and added that it may take more stringent measures regarding policy. cash, if there appears to be a clear and persistent risk to the stability of inflation expectations.

Inflation on an annual basis reached approximately 65% ​​at the beginning of this February, according to figures from the Turkish Central Bank, while the bank maintained its estimates of the inflation rate at the end of 2024 at 36%, according to its first report issued this year, with expectations that inflation will decline. To 14% by the end of 2025, and to 9% by the end of 2026.

For his part, Minister of Treasury and Finance Mehmet Simsek expressed his expectations of observing a significant decline in annual inflation rates, starting from the second half of this year, indicating that he “does not believe that the emergency factors that affected the inflation rate last January will have long-lasting effects.” term in the general trend of inflation.

Economic researcher at the Sta Research Center, Deniz Istikbal, presented conservative forecasts indicating that inflation may decline to around 50% during the middle of this year, continuing its downward path towards 30% by the end of the year, and is expected to reach 15% by the end of 2025. He also stressed the importance of Acknowledgment of the challenges that may face this process, especially in light of the experience of Turkey, which is expected to experience what is known as “reverse inflation” (which means that the prices of goods and services are constantly declining, and price rates are constantly declining).

He warned that the increase in interest rates and monetary tightening measures cause a slowdown in economic growth and a decrease in productivity, which may force companies to make employment cuts and reduce production, leading to a contraction in public consumption and a scarcity of financial resources, thus causing losses for companies.

Opportunity for voters

In his conversation with Al Jazeera Net, economic researcher Muhammad Abu Alian pointed out that the local elections represent an important opportunity for citizens to show the extent of their dissatisfaction with the current conditions, especially in light of the increasing economic challenges facing them, explaining that the decline in the living situation, represented in particular by the rise in basic life costs. ;

Such as: rents, which put great pressure on household budgets, especially in major cities;

Such as: Istanbul and Ankara. He added that these pressures may lead to prominent electoral results, as happened in the last elections, where the government lost control of these municipalities in light of a severe economic crisis.

The researcher pointed out that the economic crisis that the country witnessed, which was characterized by a contraction of the economy at a rate of 2.4% in the period between the last quarter of 2018 and the second quarter of 2019, was pivotal in shaping voters’ attitudes during that period.

He pointed out that the small difference in votes between opposition candidate Kemal Kilicdaroglu and President Erdogan in both Istanbul and Ankara reflects the continued economic factors to play a decisive role in voter trends in major cities.

He also stressed that the deteriorating economic conditions and high inflation rates in major cities put more pressure on residents, making economic issues, including inflation, the housing crisis, and rental problems, a top priority for voters.

Source: Al Jazeera