Countdown to The Next Election

Countdown to The Next Election


The Government has not announced a full-fledged “new economic plan” yet, which indicates that this hybrid model will continue until the local elections. Given this fact, we should know that the following problems will remain unaddressed during the process.


– Exchange rate fluctuations will continue at full pace.

– Interest rate hikes rates will continue as well, with a growing gap between deposit and loan interest rates.

– Although the year-end inflation expectations will increase slightly, the cost of living will soar further high.


After the recent VAT increase, people fear that the Government may decide to hike the SCT rate as well. ” I can’t say that they would not do it. But I know how taxes are determined, and I don’t think that the citizens will tolerate such an overload of compulsory contribution. Since the SCT base and the VAT base are set similarly in the law, the cost of living may reach an unbearable level as a result of an increase in both taxes. However, considering the country’s severe primary deficit, the Government may actually decide a SCT hike as an attempt to improve its revenue-spending balance.


Let’s recall how the CPI is calculated: “The CPI is calculated based on the cash sales figures of domestic products, excluding certain taxes such as VAT and SCT.” This means that although the CPI will not increase significantly, we will see that the cost of living goes up rapidly. As the gap between the CPI and the cost of living widens, expectations will deteriorate further and further.


“Diplomacy Can Solve Many Problems.”


Coming up with permanent solutions to these problems is obviously not an easy job. However, the steps that will change this vicious circle are actually political rather than technical. It is certain that policy changes like re-initiating talks with the EU and designating EU membership as a primary objective, gradually but surely reducing dialogue with Russia to a sufficient level, and engaging in a more comprehensive dialogue with China will serve us more in the medium term.


Unfortunately, foreign policy is not as effective as expected in elections anywhere in the world. Although it can help improve your economy, it is not a matter that voters take seriously. Except, of course, it is used as a tool to raise the number of votes. Likewise, our Government turned Sweden’s NATO membership into a domestic matter by bringing it to the consideration of the Grand National Assembly.