Agricultural Turkey rapidly becoming importer of farm goods
MUSTAFA SÖNMEZ – Hürriyet Daily News, December/15/2014 Inflation is continuing to be a major issue…
With its economy already fragile, Turkey now braces for a widening budget deficit, fresh inflationary pressures and a blow to its gross domestic product (GDP) after a pair of massive earthquakes devastated vast areas in the country’s southeast.
The disaster struck in the lead-up to the May 4 elections, turning up the pressure on President Recep Tayyip Erdogan, who faces the toughest yet re-election race in his two-decade rule. With annual inflation running at nearly 58%, Erdogan had hoped to deliver some economic relief to an electorate exasperated by skyrocketing prices before the crucial polls.
The disaster response now requires a significant increase in public spending to meet the needs of 13.5 million affected people — 15.7% of Turkey’s population — and rebuild massive destruction across 10 provinces. As a result, the government’s budget deficit, projected at 3.5% of the GDP in 2023, is likely to grow to up to 5% of the GDP, threatening to exacerbate Turkey’s current account deficit and other economic fragilities.