Strategy for fighting back against inflation is going to be releases a few hours after you finish reading this report. People have questions on their minds whether the 10% off campaign that caused excitement among some retailers is actually the right strategy to fight back against inflation. I just hope this will be nothing like the “let’s sell foreign currency to reduce exchange rates” campaign.
The Late Professor Erdoğan Alkin had taught me one very important fact: “Fighting inflation means, create an environment where the Government reduces productions costs so as to convince the producers of goods and services to sell their products at more rational prices.” Accordingly, efforts to reduce demand or launching discount promotional campaigns can only serve as temporary pain reliefs.
I really am looking forward to the new plan. Markets will only recover morale if this plan involves some substantial projects too, apart from discount campaigns and price controls. If the Government reveals measures to increase market congestion, I think this will bring some significantly negative impacts.
“Paddle our own canoe, revisited…”
I am going to tell this one more time: Turkey is still having difficulties in finding funds. Otherwise, why would Mr. Erdoğan say, “We have gone through a lot. But, we never asked for help, from anyone. Together, we shall overcome our problems!” The fact that he declared the IMF era is officially over and showed that he was pretty serious about the McKinsey, even conflicted with his top economy officials clearly demonstrates that President Erdoğan wants to the one who sets Government’s course of action on this specific matter.
Many of the business people I talked to during the weekend were upset about the fact that their opinions on a number of issues, including the amendment to decree no. 32 or foreign trade regime, are being taken for granted. So, they honestly think that it could be better to talk to the President Erdoğan directly in order to come up with a solution together to their problems since they have started to realize that minister and bureaucrats won’t much of a help when dealing with business affairs. Surely, it must be exhausting for a leader that everyone is depending on you to come up with a solution for a number of various problems. But, it looks like this will be the case for a little while more.
TurkStat’s latest “the data we provide is accurate” statement on inflation data did not go unnoticed either, which I might assume was some sort of reply to some foreign experts’ comments emphasizing that inflation in Turkey is in fact much higher than it seems. I must, however, say that the sudden reassignment of a TurkStat official caused some raised eyebrows.
