Populism to blame for Turkey’s economic crisis

Times are hard in Turkey. The lira has fallen by over 40 per cent this year, inflation is hovering in double digits and general confidence is at a low. On top of that, the country is at loggerheads with the US over a range of issues right from the arrest of US pastor Andrew Brunson over the charges of terrorism and espionage; Turkey’s involvement in Syria; purchase of Russian missiles; and Turkey’s restriction on American use of the Incirlik Air Base. Yet, it is not the US to blame for the economic mess that Turkey is in, but Turkish President Recap Tayyip Erdogan’s policymaking. For years, Erdogan’s government has insisted on low interest rates to fuel growth, which has instead stoked inflation. It now hovers at above 15 per cent, and is pinching household budgets. The country has been borrowing heavily, and its foreign currency debt stands at around 30 per cent of its GDP. Lack of policy vision and reforms haven’t helped key sectors to grow.

What’s more worrisome is monopolisation of power over the last couple of years. Erdogan has used his power aggressively for his own gains rather than for the country. Sweeping changes have been made to the constitution since the attempted coup in 2016, and ever since he has managed to win the elections again, he has been appointing his family and friends to all important positions in the cabinet. At a time when the economy is in dire straits, he has appointed Berat Albayrak, Ergodan’s son-in-law, as the new head of Treasury and Finance ministry. Merit does not matter, as Erdogan is reshaping Turkey with his strongman politics. There was a time when the US was a supporter of Turkey. Washington was among the few allies that staunchly supported Istanbul’s bid for accession to the European Union. In 1970s, to prove its point, the US administration had even clubbed Turkey with the European category for its administrative work. Much has changed in the last few decades. But again, for once it is not the US president to blame for this economic and social mess. The world is not waging an ‘economic war’ against Turkey, but Erdogan himself who is pushing the country into chaos with his populist policies.