Turkish gov’t does not have financial resources to battle pandemic - economists
The Turkish government does not have the funds it requires to hold back the tide of the coronavirus pandemic and is asking for public donations to stem the issue, DW Türkçe reported.
While Turkey is expected to take additional measures set by the government to stimulate the economy, Turkish President Recep Tayyip Erdoğan has sparked controversy with the aid campaign he announced on Monday, DW Türkçe said.
The government, which used Treasury resources in 2019, no longer has resources, DW Türkçe said, citing economist and author Mustafa Sönmez.
Sönmez said Turkey’s finances should be transparent to explain the economic package, like other countries do.
"Why doesn't the (ruling Justice and Development Party) do this when the whole world is willing to do it? Because the AKP ran out of gunpowder in 2018-19. Treasury resources have been depleted so that the crisis in 2018 does not get deeper," he said, adding that the only move the government can take now is to rein in the budget deficit.
There is no other solution other than for the Central Bank to print money, Sönmez said.
The Turkish lira hit record lows in 2018, following a diplomatic row between Ankara and Washington over the almost two year detention of an American pastor. Turkey has been facing difficulties in repaying its foreign currency-denominated debts ever since.
The macroeconomic indicators, especially the budget deficit, already at drastic points before the pandemic grew enough to threaten the Turkish economy, said Altınbaş University economics professor Hayri Kozanoğlu.
“It is time to meet the most basic needs of citizens by applying to all public resources and overcome them with minimal human harm, leaving aside the concerns of whether the budget deficit increases or inflation jumps," he said.
Kozanoğlu believes those who manage Turkish economy have yet to realize the magnitude of the situation. Sonmez said government considers the pandemic issue a “short-term storm" to ride out.