Everyone is watching carefully the recent rise in exchange rates. On the other hand, we are all waiting to see when these election debates will finally be over. Most people say that this election mess already became too boring. I can’t say they’re wrong.
Turkey faces many problems in many areas, including agriculture, industry, high inflation and high interest rates. Meanwhile, budget performance gives signs of trouble while there are ongoing debates whether CBRT is raking in reserves with borrowed money. And to top it all, there’s the East Mediterranean issue and escalating tensions with the United States.
Investors used to request an “immediate action plan” when confronted with so many problems. Some of them still think that an action plan is urgently required. I don’t think this is an effective approach. A remedy or a road map would simply not be enough to solve all economic and political problems.
Maybe the most rationalist approach today would be to accept the presence of problems and come up with a solution to persuade the parties to talk these problems through and eventually come to a mutual understanding. As there are many groups with different interests, customs or habits, there are also domestic and international investors having different expectations. Trying to please everyone may result in a general unhappiness.
So, in order to manage expectations the right way, we need a calm, phlegmatic voice, a policy to solve each problem one by one without hurry. Although violent incidents that emerged right after the elections are just not acceptable, I think we should consider them some sort of challenge designed to test our faith in democracy and keep our cool until things get better.
“Pessimism is the worst…”
Unemployment, recession and inflation usually arise under particular circumstances of the conjuncture and out of our mistakes that we tend to make when things are going quite well. They’re not unsolvable yet we need to give efforts to eliminate them. To achieve this end, however, we need a strong, persuasive tone of voice. The results of recent elections show us that the Government has a lot of people to convince, especially the young people living in urban areas. They need to be convinced that they have a bright future ahead. If people’s minds get stuck in pessimistic thoughts, demand would fall, company profit would fall, from finance to industry, the pace would fall, eventually employment, general income and obviously GDP growth would suffer a huge decline.
Similarly, the parties should keep talking to come up with a solution to problems. However, late solutions or markets seating under huge problems hung by a single hair, just like the sword of Damocles, would not bring any good to anyone. Sometimes, it may be better to let the time to solve the problems, but sometimes it may not. There are no miracles in diplomacy. Things would only get better if someone comes up with an unprecedented idea or offer previously non-preferred solutions.
It’s important to listen to internal and external stakeholders when governing the State and State agencies. But, in the end, it is the post-holder who has responsibility for rightfully and properly performing his/her duties. Senate Majority Leader Mitch McConnell said, “Know when to listen and when to govern”.
You can only make the right decision after listening to each party. If stakeholders do believe that they are being listened to, they would not have such a hard time to make peace with the administrators’ decisions. To achieve this, the notion of “equality and justice” should be strongly and constantly emphasized.
In short, I do not believe that the problems we’re currently facing are unsolvable. I’ve never been a pessimistic man and I don’t intend to become one. My only wish is that Turkey can avoid polarity and conflicts.
PS: Tomorrow’s report will tackle CBRT’s interest rate decision, which is due to be announced today. CBRT is expected to keep rates intact.