‘We don’t deserve this’: Inflation hits Turkish people hard

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Many people in Turkey are facing increased hardship as the prices of food and other goods have soared.

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The 59-year-old’s money selling sweatpants and other garments in Istanbul’s Ortasilar market is no longer there, and she’s struggling to buy food, few and far between.

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“I had never experienced such a depressing life. I go to sleep, I wake up and the prices go up. I bought a 5 liter can of (cooking) oil, that was 40 lira. I went back, this 80 lira,” she said. “We don’t deserve this as a nation.”

They claim that lower borrowing costs will spur growth, although economists say the exact opposite is a way to control rising prices. The Turkish lira has been faltering to a record low against the US dollar as the country’s central bank slashed interest rates, fueling concerns about its independence.

The Turks caught in the middle are trying to make ends meet.

“Everything is so expensive, I can’t buy anything,” said Suhela Poyraj, browsing the food stalls at the Ortasilar market in Istanbul’s Ipsultan district.

The 57-year-old housewife voted for Erdogan’s party and called on the government to act to end inflation.

“If you are the government and if we are voting for you to fix things, why are you not intervening? Why are you not stopping the rising prices?” Poyraj said.

High inflation is hurting the popularity ratings of Erdogan, whose early years in power were marked by a strong economy. Opinion polls indicate that a coalition of opposition parties that have formed a bloc against Erdogan’s ruling party and its nationalist allies is rapidly narrowing the gap.

The Turkish government says inflation rose nearly 20% in October from a year earlier, but an independent inflation research group made up of academics and former government officials put it astonishingly closer to 50%. In comparison, US prices rose by about 6% from a year earlier – the highest since 1990 – and inflation exceeded 4% in the 19 EU countries that use the euro, the most for 13 years. in the most.

As a result, the Turkish currency hit an all-time low of 10 against the US dollar last week and has lost nearly 25% of its value since the start of the year. This is driving up prices, making imports, fuel and everyday goods more expensive. While some argue that a weaker lira would make Turkish exporters more competitive in the global economy, much of Turkey’s industry depends on imported raw materials.

There are concerns about Erdogan’s impact on monetary policy. He has appointed four central bank governors since 2019 and fired bankers, who are said to have opposed lowering interest rates. The bank has hiked rates by 3 per cent since September and will issue its latest decision on Thursday.

Conversely, central banks in other pandemic-hit countries are raising rates or considering doing so in the coming months as backups in ports and factories, labor shortages and rising energy costs have pushed up prices.

Foreign investors are dumping Turkish assets, and Turks are converting their savings into foreign currencies and gold.

“This intervention for central bank independence has resulted in a huge sell-off in financial markets,” said Ozlem Derisi Sengul, an economist and founding partner at Istanbul-based Spin Consulting. “There are many factors that drive both inflation and financial market prices … (but) the major factor is central bank policy.”

He estimates that more than half the population is “struggling with income.”

Meanwhile, Erdogan stressed that the economy is strong and the country is emerging from the pandemic in a better position than others.

“The shelves are empty in Europe, they are empty in the United States. Praise be to God, we continue with abundance and abundance,” he has said.

His government has blamed exorbitant food prices on supermarket chains and ordered an investigation that resulted in fines. He has also ordered agricultural cooperatives to open 1,000 new shops across the country to keep food prices low.

Earlier, he accused a group of students of “terrorism” of sleeping outside in parks to protest high housing and hostel prices. Meanwhile, rents have skyrocketed and prices for home sales, pegged mostly on the dollar, are rising.

Labor and Social Security Minister Vedt Bilgin said this month to ease the pain that the government was working to adjust the minimum wage to protect workers from rising prices.

“We are working to remove the issue of minimum wages from the agenda – I can already say that it will bring relief,” he said.

Economists say this is not enough.

“If the government continues to focus on low interest rates, loose monetary policy and election preparedness, inflation and low income and unequal income distribution will have more side-effects in 2022 and 2023,” Sengul said.

Musa Taimur, owner of a grocery store in Istanbul, said rising prices have made it difficult for him to replace products.

“Any products we sell – we can’t get them at the same prices,” he said.

He said his customers are no longer able to afford a variety of food and mostly buy bread, pasta and eggs.

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Fraser reported from Ankara, Turkey. Associated Press journalists Zeynep Bilginsoy and Ayse Witting contributed in Istanbul.

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