Connect with us


Analysis: President Erdogan’s rate cuts are high-risk gamble ahead of 2023 elections

Turkish President Recep Tayyip Erdogan is putting his political life on the line with a risky wager that driving down interest rates will reverse his skidding opinion polls, despite what is already a heavy economic toll on voters.
The country’s leader of nearly two decades is ploughing on with a “new economic model” he says will boost jobs, growth, exports and cheap credit – and ignoring for now a resulting historic drop in the lira, as well as soaring inflation.

For all the latest headlines follow our Google News channel online or via the app.

The policy shift could signal a last-ditch attempt by Erdogan and his ruling AK Party (AKP) to shore up his socially conservative, working and lower middle class voter base ahead of presidential and parliamentary elections in 2023, analysts said.

But surging prices and currency devaluations are already wreaking havoc on Turks’ household budgets and future plans.

In Istanbul’s working class Kasimpasa district, an AKP bastion where Erdogan, a pious Muslim, studied the Koran and played soccer as a boy, few can ignore the rocketing cost of living – and some said it could sway their votes.

“People who come by my teahouse are complaining a lot about prices. The economic struggle is on everyone’s agenda,” said Abdurrahman Erenli, serving tea to a handful of customers across the road from a mosque where Erdogan used to pray.

“People are changing their views due to the situation in the economy. I think votes for the AKP will come down in the next election, for sure, though they still have very solid support.”

It is a far cry from the early years of AKP rule when its pursuit of free market policies and orthodox monetary policy helped to rebuild Turkey’s economy after a deep crisis in 2001.


Under pressure from Erdogan, Turkey’s central bank has slashed its policy rate by 400 basis points to 15 percent since September. It will likely cut again this month, despite inflation that is near 20 percent and is expected to approach 30 percent.

The fallout has been dramatic.

The lira shed some 30 percent in November alone, its second-worst month ever, reflecting Turkey’s deeply negative real rates as well as its high foreign debt and heavy reliance on imports.

Turks are now struggling to find some medicines and buy some other imports such as mobile phones. Opposition leaders are demanding snap elections.

“This country cannot be abandoned to this ignorance anymore,” said IYI Party leader Meral Aksener.

Erdogan’s Islamist-rooted AKP and its nationalist allies MHP are now at level-pegging with an opposition alliance, each with about 39 percent support, according to a MAK Danismanlik poll published on Saturday.

A Metropoll survey showed Erdogan’s job approval has hit a six-year low. Polls also show he would lose to likely presidential candidates including Aksener and Istanbul’s mayor, Ekrem Imamoglu of the main opposition CHP.

“It is clear the ruling alliance is losing support. The steps in the economy need to yield results, otherwise there may be vote losses,” said a senior government official who requested anonymity.

Digging in

A senior AKP official said the new measures would yield benefits by the time of the election.

“Of course we have entered a difficult period (but) what is needed now is time,” the official said.

Reuters has reported, citing sources, that Erdogan ignored appeals in recent weeks, even from within his government, to reverse what he has called Turkey’s “economic war of independence.”

Erdogan has defended the rate cuts six times in the last two weeks and said there is “no turning back,” with almost every speech driving the currency to new record lows.

The lira touched 14 to the dollar on Tuesday, down from 6.9 in February before Erdogan sacked the previous central bank governor and began aggressively pushing his easy-money views.

The depreciations stoke import prices and broader inflation expectations in a country where food prices are up nearly 30 percent from last year.

“The most acute issue is high inflation,” said Can Selcuki, general manager of Istanbul Economics Research, a consultancy.

“I expect the elector sentiment regarding both the government and Erdogan to sour further.”

Read more:

Recent depreciation in Turkey’s lira is adding to inflation pressure: Fitch

Turkey’s Erdogan stays firm on interest rates, lira weakens four percent

Protests in Istanbul, Ankara calling on Erdogan’s govt. to resign after lira crash

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *


CyberArrow and Mobily Announced a Strategic Partnership for CyberArrow’s AI-Powered GRC at Black Hat 2023

In a groundbreaking collaboration, Mobily, one of the largest telecom companies in Saudi Arabia, and  CyberArrow , a leading UAE- based Compliance Automation Platform and Cyber Security Awareness Platform provider, proudly announced their strategic partnership at Black Hat 2023. This partnership marks a significant step towards revolutionizing the approach to compliance in the Kingdom of Saudi Arabia. The announcement cements Mobily as a strategic partner using CyberArrows AI-Powered GRC to boost cybersecurity compliance in the region. CyberArrows latest AI GRC was featured at the center of Black Hat 2023.  Key Highlights of the Strategic Partnership
The strategic partnership between CyberArrow and Mobily is a dynamic collaboration aimed at
reshaping the landscape of cyber security and compliance in Saudi Arabia. As a strategic partner,
Mobily helps organizations across Saudi Arabia enhance compliance processes and streamline
governance, risk, and compliance by utilizing CyberArrows AI-Powered GRC. This collaboration goes beyond physical presence; it symbolizes a shared vision for transformative advancements in compliance. The strategic partnership is designed to provide organizations in Saudi Arabia with intelligent solutions for navigating the complexities of cyber security and compliance with unprecedented efficiency. The partnership highlights the profound impact of integrating Artificial Intelligence (AI) into cyber security and compliance. Through cutting-edge solutions and strategic partnerships, CyberArrow demonstrates its commitment to leveraging AI as a catalyst for transformative change. As CyberArrow strategically partners with Mobily, these key messages echo their shared vision, amplifying the call for utilising CyberArrow’s AI-powered GRC platform and fortifying the digital landscapes of businesses in Saudi Arabia. “The collaboration with Mobily signifies more than just a partnership; it's a shared vision to make cyber security compliance accessible and robust for businesses in Saudi Arabia”, said Amar, Co-founder of CyberArrow

Continue Reading


TÜYAP will host the Carpet and Flooring Expo 2023

Around 400 companies will converge in Istanbul for Carpet and Flooring Expo
2023. This event, taking place from 5-8 December, will open new market avenues
for these companies. Türkiye, a nation responsible for crafting 40% of the worlds carpets, is playing host to this prestigious event.Türkiye, a key player in the global carpet industry, is gearing up to host the Carpet and Flooring Expo (CFE 2023) in Istanbul. This pivotal event, orchestrated by TÜYAP – the country’s foremost exhibition organizer – in partnership with the Istanbul Carpet Exporters’ Association and Southeastern Anatolia Carpet Exporters’ Association, will take place at the Istanbul Expo Centre from 5-8 December. The Expo, expected to attract around 400 companies from across the globe, will showcase an extensive array of products, providing an invaluable opportunity for manufacturers to tap into new markets. Türkiye has a 40% market share of global carpet production İlhan Ersözlü, General Manager of TÜYAP Fairs Productions Inc., highlights Türkiye’s significant role in the global carpet trade, stating, “Türkiye currently accounts for 17% of the worlds carpet trade volume. Through CFE 2023, we aim to foster new agreements, boosting our
export volume to 25%.” The global carpet market, valued at USD 64.99 billion in 2022, is anticipated to soar to USD 97.41 billion within a decade. Türkiye, producing nearly half of the worlds carpets, is a pivotal player in these global gatherings. 400 companies expected to participate in CFE 2023 Ersözlü stated, “Currently, our fair features nearly 400 participants, with 75% from Türkiye and 25% being international stakeholders. We’ve seen substantial interest from manufacturers in countries including Iran, China, England, Pakistan, Afghanistan, Uzbekistan, Russia, Indonesia, Morocco, Ukraine, Egypt, and Jordan. Our goal is to host one of the largest fairs in this sector.” He added, “The fair will display a spectrum of products, from traditional to contemporary designs. Registered visitors from 81 countries will have four days to explore these offerings. Additionally, well host discussions and workshops on future trends, designs, colours, and
recycling. Li Edelkoort, a renowned trend forecaster, will be present to deliver a talk titled ‘2025 Interior Trend and Colour Forecasts’ on 6 December at 16.00. This event will be an enormous source of inspiration for professionals in the carpet industry as well as designers, decorators, and

Continue Reading


Gulf Scientific Corporation Achieves ISO 9001:2015 Certification, Setting New Standards in Quality Management

Gulf Scientific Corporation (GSC) has recently achieved a significant milestone by obtaining the ISO 9001:2015 certification, reinforcing its commitment to quality and excellence in the field of scientific solutions. This certification, awarded by the International Organization for Standardization (ISO), is a testament to GSCs dedication to meeting and exceeding global standards in its operations. ISO 9001:2015 is the latest version of the international standard for quality management systems, emphasizing a process-oriented approach to ensure organizations consistently deliver high-quality products and services. GSCs successful certification process reflects its adherence to rigorous quality management practices and continuous improvement initiatives. One key aspect of ISO 9001:2015 is its focus on customer satisfaction. GSCs commitment to understanding and meeting customer requirements is highlighted through this certification, as it demonstrates the company’s dedication to providing products and services that consistently meet or exceed customer expectations. This customer-centric approach is crucial in todays competitive business environment, where customer satisfaction plays a pivotal role in the success of any organization. Furthermore, the ISO certification positions Gulf Scientific Corporation as a reliable and trustworthy partner for businesses seeking high-quality scientific equipment and solutions. It enhances the company’s reputation and opens doors to new opportunities and collaborations on a global scale. By implementing a robust quality management system, GSC will also be better equipped to manage risks and seize opportunities, ensuring the organizations resilience and adaptability in a dynamic market. Internally, the certification process has led to improved operational efficiency within GSC. Through a thorough examination of its processes and procedures, the company has already identified areas for enhancement and optimization. This commitment to continuous improvement not only aligns with
ISO 9001:2015 requirements but also positions GSC as a forward-thinking and adaptive organization. Gulf Scientific Corporations attainment of the ISO 9001:2015 certification underscores its dedication to quality, customer satisfaction, and ongoing improvement. This achievement not only enhances GSCs reputation in the industry but also instils confidence in its customers, partners, and stakeholders. As GSC continues to uphold these high standards, the ISO 9001:2015 certification serves as a symbol of the company's commitment to excellence in the ever-evolving landscape of scientific solutions.

Continue Reading