Former Turkish Economy Minister, now head of the opposition Democracy and Breakthrough Party, Ali Babacan warned of a serious risk of hyperinflation in the country.
Turkey is going through a period of chronic inflation. If they thoughtlessly, without any plan or program in place, continue to print money, Turkey will enter the stage of hyperinflation, the Sözcü newspaper quoted the politician as saying on Monday.
Babacan, who headed the Turkish Foreign Ministry and the Ministry of Economy from 2002 to 2015, promised to reduce inflation in the country to a minimum if the opposition comes to power in the elections in 2023. “We will reduce inflation to single digits. We have done this before, we will do it again for the first six months,” he said.
The opposition politician, who left Turkish President Recep Tayyip Erdogan's ruling Justice and Development Party in 2019, has been called the "father of the Turkish economic miracle." He is the author of a liberal program, thanks to which the Turkish economy has grown by 6-7% a year for more than 10 years, a record influx of foreign investment has been noted in the country, and the annual per capita income has reached an average of $10,000. Babacan was one of the opponents of the policy of state management of the economy and government intervention in the monetary policy of the Central Bank, which became especially noticeable after 2018, when the presidential form of government replaced the parliamentary form of government in Turkey.
According to official data, the inflation rate in Turkey rose to 69.97% in April, from 61.14% a month earlier. Independent experts claim that the inflation rate in the country has reached 157.86% and warn of the possibility of its further growth. Against the backdrop of inflation, the national currency - the Turkish lira - has lost almost 5% of its value against the US dollar since the beginning of May. On Monday, at the Istanbul Stock Exchange, one dollar was worth 15.5 liras.
Analysts predict that the lira will continue to depreciate due to rising inflation and the Central Bank's unwillingness to revise the discount rate, which has been at 14% since the end of last year.