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Recent Period Economic Problems and Reasons Behind the Curtain in Turkey
Problems which taking place in real life are having bad effects on many units in Turkey, and arousing curiosity by many fractions for possible solutions. First and most, it is necessary to mention that the reasons haven’t occurred recently. Internally and internationally, many causes brought Turkish Economy into hardships. Inevitable rise of dollar since 2012, stagnation in Istanbul Stock of Exchange, being unable to decrease unemployment rate and moreover currently soaring one, can be rooted to the those causes.
International reasons:
- Problems regarding to U.S. public financing, hitting U.S. Debt Ceiling again and again , 
- Stagnation in European Economies, economic crises in Mediterranean countries  , 
- China’s dream for ruling the world by economy and after 2012 economic stagnation in China  , 
- Bad effects of China’s economic stagnation over world distribution channel  , 
- Rise of rightist views in the world and leaving liberal ideas  ,
- Increase of popularity of racist views in the world regarding to President-Elect Trump  ,
- Regarding to oil prices, capital owners sank into economic problems  ,
- Middle East crises after Arab Spring and staying far away from Middle East countries by investors  . 
All those reasons had bad effects on Turkish Lira and decreased cash flow into Turkey.
Internal reasons:
- Planning and calculation for future cash flow without interruption from foreign investors
- Solid support for construction sector  ,
- Insufficient support for research-development, despite the fact that Turkey is one of the 20 largest economies in the world, in 2016 according to Global Innovation Index Turkey is 42nd country on the list  ,
- Interest rate decrease in an artificial way, no room for market conditions, 
- For huge infrastructure projects, state guarantee given in U.S. Dollar terms  ,
- Over years, the parity between consumption and production levels deepened,
- Immigrants from outside of Turkey without skills and/or education who are heavy burden for economy,
While all those reasons caused to increase U.S. Dollar- Turkish Lira parity, also made investors stay away from developing countries as well as from Turkey.
Let’s come to how to zero out those problems or at least minimize them:
- To understand and execute requirements of floating rate regime, intervention to the market according to the market conditions,
- Taking, cash flow wouldn’t come sufficiently or even would stopped completely for the country anymore, into the account and in that way taking necessary steps, moreover make a start for capital accumulation (for example implementing Individual Retirement System in a smart way would bring profit),
- To become Start-up Country for increasing technical and technological accumulation (embracing and supporting everybody who is creating technology), 
- Decreasing support for construction sector, understanding importance of domestic demand but seeing consumption without production is harmful,
- Subsidies from state agencies must be given in a more simple way and moreover sectors supported must be selected smartly,
- Deepening the subsidies for exports, providing these supports for every possible candidate,
- Creating an education system based on imagination and innovative thinking system, staying away from dogmatic mentalities,
As long as those steps implemented, it can be foreseen Turkish economy grows stronger and stronger.
1) http://www.marketwatch.com/story/us-debt-ceiling-of-20-trillion-plus-to-be-reached-soon-in-next-presidency-2016-09-13
3) dailysignal.com/2016/12/02/is-the-chinese-economy-hitting-stagnation
4) https://www.ft.com/content/30441208-b548-11e5-b147-e5e5bba42e51
5) http://www.bbc.com/news/world-europe-36150807
6) http://www.huffingtonpost.com/entry/donald-trump-racist-examples_us_56d47177e4b03260bf777e83
7) http://www.climatechangenews.com/2015/02/19/gulf-states-facing-social-and-economic-crisis-as-oil-revenues-crash/
8) http://www.climatechangenews.com/2015/02/19/gulf-states-facing-social-and-economic-crisis-as-oil-revenues-crash/
9) http://www.ito.org.tr/itoyayin/0000400.pdf
10) https://www.globalinnovationindex.org/gii-2016-report
11) http://www.ntv.com.tr/ekonomi/osmangazi-koprusunde-arac-garantisi-ne-kadar,RyGIQAm5qkCrVXTRRLG93g
Mustafa Salim Erek, Analyst, Strategic Outlook
5.12.2016 - Hit : 985

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