Turkey’s restauranteurs lack enough money to declare bankruptcy due to pandemic

Aydın Ali Kalaycı, chairman of Beyoğlu Entertainment Locales Association in Istanbul, told Gazete Oksijen on Friday that thousands of bars, restaurants and cafés in the megacity’s once-bustling heart were facing eviction and permanent closures.

“Business owners have so little money left that they can’t pay their backlog in taxes and officially declare bankruptcy,” Kalaycı said.

According to the chairman, more than 3,000 notices from debt collectors have been sent to muhtars, municipal officials for neighbourhoods, as pandemic restrictions resulted in more and more businesses being unable to keep up with payments.

Most of the notices are from landlords, while many bars and restaurants have had to sell their furniture and kitchen equipment to scrap dealers for a fraction of their value, Kalaycı added.

“When the pandemic is over, many won’t have enough left to open back their businesses,” Kalaycı said. “Thousands will be left unemployed and suppliers will also suffer.”

Those who want to sell their business can’t find buyers, and the key money prospective renters would pay has all but disappeared, while it could run into hundreds of thousands of dollars before the coronavirus hit Turkey.

Bars and restaurants have been unable to open for 11 months now, since March 2020. The restaurant industry has more than 100,000 businesses and employs some two million workers, according to Tourism and Restaurant Investors Gastronomic Businesses Association Chairman Kaya Demirer.

The industry has lost 90 billion liras ($12.75 billion) during the course of the pandemic, and especially larger restaurant groups need additional bail outs, Demirer said.

“We demand around 20 billion lira in support, and a six-month moratorim on tax and social security payments, which comes to an additional 25 billion,” he continued. “If this is not provided, the state will suffer bigger losses in the long term. Some 35,000 businesses will close permanently and 700,000 people will be left unemployed.”

The Turkish government is planning to give 3 percent of the revenue restaurants have lost, provided that their 2019 revenue was less than three million lira and they lost more than 50 percent of it in 2020.

Turkish Restauranteurs Federation Deputy Chairman Sayıt Karabağlı proposed a tracking system to help open businesses back up.

“Like we can now enter shopping malls with a code, can do the same,” he said. “There can be limits of two customers per table, or even one. Such support would be a lifeline.”

“We as an industry just want to stay afloat, we don’t care about making money anymore,” Karabağlı said.