Central Bank Increases Interest Rate & more– 29th Aug 2023

Merhaba from Keswick Village! This is the Rorshok Turkey Update from the 29th of August twenty twenty-three A quick summary of what's going down in Turkey.

Let’s kick off this edition with some economic news…

On Thursday the 24th, the Central Bank announced the new policy interest rate. The bank increased the rate from 17% to 25%. The surge exceeded expectations, as many forecasted the bank to increase it to 20%.

Following the interest hike, the Turkish Lira gained value against the US Dollar, dropping to as low as around twenty-five liras per US Dollar. Of course, it has increased since then, one US Dollar is over twenty-six liras now.

The new economic team of the country, the central bank, and the ministry of finance decided to return to more traditional economic policies after the elections in May, and this hike shows that they are following through on their decision.

On the topic, Reuters reported that the interest rate hikes apparently got foreign investors’ attention. Many investors have been hesitating to invest in Turkey because the economic model wasn’t very trustworthy. Now, it seems, they may be reconsidering their stand.

Speaking of the economic team…

On the weekend, the news that Mehmet Şimşek, the finance minister, requested the International Monetary Fund, better known as IMF, to visit the country and write a report on its economic situation broke out on social media. However, the ministry denied such news. It said that the IMF might visit the country to get to know the new economic team and get familiar with Turkey’s new economic policies as part of a routine visit, but that the ministry didn’t invite the IMF. The IMF also denied the allegations.

Meanwhile, the people are struggling with economic hardships.

Schools are starting on the 11th of September and reports say that the cost of back-to-school shopping increased by up to 75% compared to last year. On average, school supplies cost about a thousand liras, around forty dollars, per child, which is one-tenth of the minimum wage in the country.

Let’s talk about housing now. Knight Frank, an international real estate consultancy firm, reported that housing prices increased over 130% in the first quarter of this year compared to the prices of twenty twenty-two. In addition, a study the firm conducted on housing prices in 150 cities over fifty countries revealed that İstanbul, İzmir, and Ankara were the top three cities with the highest price increases.

On to some news on international relations…

On Saturday the 26th, the Turkish Foreign Minister visited Zelensky, the Ukrainian President, in Kyiv. During the meeting, they discussed the Black Sea grain export deal. Previously, the United Nations and Turkey aided in a deal between Russia and Ukraine, in which the latter would continue exporting grain in order to eliminate the risk of a shortage of the commodity in the world. However, last month, Russia pulled out of the deal. After the meeting, Turkey expressed that renewing the deal was the country’s top priority. The Ukrainian Foreign Minister added that, even though they are looking for alternative ways to export grain, the Black Sea corridor is the ideal solution.

Now, let’s talk about the presidential election that took place in May…

Evaluating the loss of her party’s alliance in the elections this year, Meral Akşener, the head of the opposition Good Party, said that the alliance system was harming political dynamics, polarizing the public, and also worked in favor of the ruling Justice and Development Party. Recall that during the elections, many parties gathered together to form alliances and three coalitions participated in the elections, accounting for over fifteen parties. Akşener called on all those parties to participate in the twenty twenty-four local elections on their own.

On the local elections, Akşener also added that her party will nominate its own mayoral candidates in every city and that the party isn’t planning on making strategic agreements like not nominating candidates for other parties’ favor. The party previously teamed up with the main opposition the Republican People’s Party, or CHP, and didn’t nominate any candidates where the CHP had a strong chance of winning and vice versa.

Before the election, an imam, a Muslim preacher, called civilians to take up arms on the election day during a sermon. A video of his speech went viral on social media and he was suspended shortly after for spreading hate. However, people recently found out that he was reinstated in his position three months later and he continues working as if nothing happened.

The move was called into question on social media, as he might have been reinstated because he spoke against the opposition.

Let’s move on to some health-related news…

A prosecutor filed a lawsuit against Dr. Yusuf Eryazğan, the head of the city of Urfa’s Family Physicians Association, for sharing misleading information with the public. Reportedly, he said during a TV program that Turkey had a vaccine shortage.

After the lawsuit, the doctor revealed that his remarks were about a supply problem for Hepatitis B, polio, and tuberculosis vaccines. He added that the problem has been prominent in Urfa, as well as across the country, especially since the end of twenty twenty-two. He further said that he contacted authorities on the matter, but the issue was still unresolved, and that it caused problems between family physicians and patients.

Still on public health…

The health ministry uses an online prescription system that makes it more accessible for pharmacists and doctors to keep up with prescriptions. The ministry recently announced that the system was made available in five foreign languages, including Arabic and Russian. However, Kurdish wasn’t on the list. It was called into question, as Kurdish is one of the most spoken languages in Turkey, and there are many Kurdish citizens within the country. The move caused backlash, since now Russians and Arabs, both tourists in the region, can receive the service in their own languages, but the Kurdish minority in the country cannot.

On to air pollution…

Experts say that the air pollution level in the city of Hatay is at an alarming level. Recall that Hatay is one of the cities that were heavily affected by the February earthquakes and nearly the whole city collapsed. Experts say that people in the city, especially the ones working with the collapsed buildings are at risk of developing cancer.

Here’s an update on the water shortage in İstanbul…

Reportedly, on Tuesday the 29th, the water level in the city’s dams dropped below 30%. The municipality and the governorate have been warning residents to save water as much as they can.

And to close this edition, an update on an earthquake.

In the early hours of Tuesday the 29th, there was an earthquake measuring five on the Richter scale in the city of Konya. Reportedly, people in the surrounding cities, including the country’s capital Ankara, felt the earthquake. Luckily, there haven’t been any reports of injuries or damaged buildings, but rescue teams are still investigating just in case.

And that’s it for this week! Thanks for joining us!

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