Businesses feel the impact of TL crisis
THE worst-ever economic crisis to hit the TRNC, with more hikes in electricity and fuel prices predicted, is now forcing farmers to sell livestock they can no long afford to feed, according to an agriculture industry leader.
“With the latest increases in the cost of fodder, fuel and electricity, some of our members are unable to cope financially and have now started to sell their animals,” said Mustafa Naimoğulları, leader of the Animal Breeders’ Union.
“On Wednesday last week, our sector received eight million TL from the government as a fuel subsidy for the period 2016 to 2017 but the price hike of the same day instantly reduced the value of it to some six million TL,” he said.
“Producers can only survive with tax-free diesel because fuel is our biggest expenditure. In the South, subsidised, coloured diesel is available for farmers and we want the same system here as well. That is the only way future production will be possible. Under the present circumstances, we are unable to compete with the South or with Turkey.”
Another industry sector leader, Hürrem Tulga of the Artisans’ and Craftsmen’s Chamber, also claimed that many of his members were on the verge of bankruptcy.
“With price increases coming one after another, it is difficult to manufacture or to sell,” he said.
“We import virtually everything, including students and workers, and when they do not come, the economy suffers.
“We have failed to do things properly and have created a country with an unsustainable economy. Tourism and universities have not been properly developed and the economy has been shrinking since 2007.
“Every time there are protest demonstrations, it is to voice demands and not to improve anything.”
Economist Okan Şafaklı said rises in the price of fuel, which went up again last week, inevitably triggered increases in everything, from electricity to bread. However the government was in an invidious position, and if it cut taxes, as some had demanded, it would be unable to pay state sector salaries.
Erdal Güryay, head of the Business Administration Department of Kıbrıs İlim University, said: “The only hope [for the TRNC] is that foreign investors consider as credible a statement made last week by Turkish Finance Minister Berat Albayrak, who said the escalation of foreign exchange rates would stop and the Turkish lira would strengthen.
“We will just have to wait and see.”