Butter was just worried: inflation is becoming a problem for Erdogan. Last year, unemployment was at its lowest level since 2001

Anyone in Turkey who complains about inflation in Switzerland only gets a tired smile. Inflation was almost 65 percent in December. Even the head of the central bank can no longer find affordable housing in Istanbul.

When market vendor Sabri Yavuz goes out in the morning to sell white cabbage and lemons, he already knows that he will go home with too little money in the evening. “We can’t make ends meet,” says the 45-year-old.

On the table in front of him are piles of thick coals that he sells at a market in Istanbul. People didn’t buy anything, many complained about the prices, says the father of the family, who often doesn’t know what to do next.

Turkey’s inflation rate recently reached a whopping 64.77 percent year-on-year and is expected to rise in the coming months. This mainly drives people from the middle and lower classes into existential crises.

The reason for the high inflation is the economic policy pursued by Turkish President Recep Tayyip Erdogan in the past. Low interest at any price. Inflation skyrocketed and reached over 85 percent in October 2021.

Only after the elections in May 2023 and a change at the top of the central bank and the Ministry of Economic Affairs did Erdogan initiate a change of course. The policy interest rate was increased sharply and currently stands at 42.40 percent. But the fight against inflation is taking a long time.

Butter and toothpaste secured by alarm

The fact that things have become considerably tighter financially for many people is also evident from supermarkets, where butter, toothpaste, olive oil or baby food are sometimes only put on the shelves with alarm protection. Last year, communications designer Mahir Akkoyun designed a sticker to express his dissatisfaction with the price increases. «Is this product too expensive? Thanks to Erdogan,” it said next to a photo of the Turkish president. The author was quickly arrested and charged, although he was acquitted at trial.

Housing in particular has become unaffordable for many people. In November 2023, prices nationally were on average 86.5 percent higher than the year before. In no other OECD country did rents rise as sharply as in Turkey in the fourth quarter of 2023, statistics from the organization show.

Because rent increases are legally limited to 25 percent, many landlords try every possible means to evict their tenants. Civil courts are reportedly suffering from a flood of lawsuits against rental evictions.

The head of the central bank, Hafize Gaye Erkan, recently lamented the real estate crisis in an interview that caused a stir. She could not find an affordable home in Istanbul and therefore moved back in with her mother. According to reports, the head of the central bank earns around 5,000 euros per month and her statements were therefore met with much incomprehension among low incomes.

Ten credit cards in my wallet

Erol Günes sells handbags at markets six days a week. With ten credit cards in his wallet, the 50-year-old Kurd and father of two children tries to make ends meet. So far he has debts of 200,000 lira (more than 5,684 francs). Everyone did it that way.

In late December, debt prompted a 42-year-old father of four to throw himself into the foyer from the third floor of an Istanbul shopping center. He clung to the parapet and shouted, “I am hungry, my children are hungry, I am in debt.” The man survived with serious injuries.

‘Inflation destroys the middle class and leads to extremes. The rich are getting richer, the poor are getting poorer,” says economist Seref Oguz. Street research shows that people go to bed hungry and when they are over 70, have to go back to work because their pension is not enough to survive.

The minimum wage, which the government says 37 percent of people receive, was recently increased to 17,002 liras (483 francs). Unions criticized this as clearly not enough. According to the workers’ representative body Türk-Is, the poverty line in December was 47,000 liras (about 1,336 francs).

Economist Oguz does not believe the government’s forecast that inflation will fall to 34 percent by the end of the year. “To overthrow them in the long run, orthodox economic policies must be strictly pursued. At the same time, the government must also abandon its populist rhetoric and implement strong austerity measures in public spending.

Last year, the government repeatedly made election gifts worth billions. Observers assume she will also dig deep into her pockets to win Istanbul, the country’s most populous province, before the March 31 national local elections. (sda/awp/dpa)