The economic side of Erdoğan's government

I know that Erdoğan, who established a single-handed government system in Turkey, also has many fans in Azerbaijan. We would not be mistaken in describing him as a very charismatic leader of the brotherly country in recent decades. He is a historical figure with many advantages, from the quality of leadership to Turkish fanaticism, from being a strong-willed statesman to being an orator.

However, with so many economic downturns, squaring people who have no compatibility with public administration with the society under the name of the technocratic corps is a real challenge. It is truly astonishing to see a president who behaves as if nothing happened, creating the impression of a leader left alone, losing so many colorful team members (those with academic backgrounds, intellectuals). Listening to the speeches of a statesman who is known for his emphasis on populist projects and has many shortcomings in terms of basic economic thinking, I ask myself: either the president does not have an advisory body, or he does not listen to anyone and is extremely self-confident, regardless of outside opinions. Personally, it sometimes seems to me that Erdoğan is too stubborn or bad-tempered. He is a person who believes in his own ideas terribly and is intolerant of outside opinions, tolerating no alternative.

There are many macroeconomic indicators that show the strength of Erdoğan's economic team. However, there are a few that offend the eye: a persistent negative balance of payments (current account deficit), double-digit annual inflation, an increase in the number of low-income groups with increasing dependence on the state, an increase in the double-digit unemployment rate approaching 20 percent, increase of foreign public debt to a critical level, etc. These are so important macroeconomic indicators that they are very important for unbalanced situations.

Economic growth in Turkey

Analyzing the table above shows how sensitive and unsustainable economic growth is. However, when he was Prime Minister in 2011, when announcing the challenges facing the economy in 2023, Erdoğan spoke of completely different goals:

• Annual GDP will be $ 2 trillion;
• National per capita income will be $ 25,000;
• Annual exports will be $ 500 billion;

Despite the fact that only 3 years left for achieving the goals, it is possible to measure macroeconomic indicators according to the results of 2020. The current situation in the economy is as follows:

• Annual GDP is $ 717 billion (1/3 of the goal)
• National income per capita is $ 8,000 (1/3 of the goal)
• Annual exports reach $ 170 billion (1/3 of the goal)

Is it possible to believe that they will be able to do what they have not been able to do in 228 months since 2011 in the next 28 months? This is a serious reason to think deeply.

It is necessary to pay attention to the negative balance of payments, which Turkey has suffered for many years. In the years since the AKP came to power in 2002, it has become very clear how negative the current account balance has been.

Since Erdoğan came to power, the balance of payments has had a negative balance (current account deficit) of $ 570 billion for 2003-2020. However, in the period from 1980 to 2002, it was at the level of $ 27.2 billion.

In general, when analyzing the last 17 years, the economic aspects of Erdoğan's government from 2003 to the present can be assessed on the basis of several important economic parameters and results:

• When Erdoğan came to power, Turkey's share in high-tech exports fell from 6.12% in 2003 to 3.23% in 2020.
• Turkey's share in developed countries fell from 3.57% in 1980 to 2.15% in 2019.
• If the per capita public debt was 12,400 TL in 2018, it was 22,150 TL in the first quarter of 2021 (March).
• According to official data, 11 million people are unemployed in the country. However, according to alternative calculations, the number of unemployed is over 20 million.

It is understandable that the Turkish lira is shaking the markets in the context of such elements of economic recession. There is a "cold" money problem in the country. How to stabilize the markets with "hot" money?

The AKP government must clearly acknowledge that despite Erdoğan's important place in Turkey's political past, the Turkish community, investors, and other actors of the community do not seem interested in going with him to the future.

Mammed Talibli