Abu Dhabi, UAESaturday 11 July 2020

CORONAVIRUS

Coronavirus: Turkey's Erdogan juggles economic and health concerns

With the economy in a fragile state, the president is resisting a total lockdown despite soaring infections

President Recep Tayyip Erdogan speaks about the coronavirus pandemic at Huber Palace in Istanbul on March 27, 2020. AFP  
President Recep Tayyip Erdogan speaks about the coronavirus pandemic at Huber Palace in Istanbul on March 27, 2020. AFP  

As the coronavirus pandemic sparks a global economic downturn, Turkey is trying to keep its faltering economy on track while introducing measures to curb one of the world’s fastest-growing outbreaks.

Since declaring its first case on March 11, Turkey’s infections have soared to put the country on one of the steepest trajectories in the world.

From being the last G20 nation to report a case, Turkey now has the ninth-highest number of confirmed patients in the world – 20,921 by late Friday, with 425 deaths.

However, President Recep Tayyip Erdogan has resisted imposing a full lockdown in an effort to “keep the wheels turning” as the economy recovers from a 2018 currency crisis.

Economic indicators show a severe slowdown. The lira has fallen by about 11 per cent against the US dollar this year, credit card spending dropped 31 per cent last week and the government said export figures for March were expected to fall by about 17 per cent.

Inflation stands at just under 12 per cent while the unemployment level hovers around 14 per cent.

The government has implemented a 100 billion lira (Dh54.5bn) economic support scheme and raised more than 1bn lira in a “national solidarity campaign” to support those hit hardest by the economic fallout.

Zumrut Imamoglu, chief economist at the Turkish Industry and Business Association, said those expecting Turkey’s economic package to mirror America's $2 trillion (Dh7.3 trillion) bailout were disappointed.

“It is not surprising that the government is not willing to dig deeper into the budget this year,” she said. “The recent crisis in Turkish economy fuelled by an exchange rate spike late 2018 has put the budget deficit over 5 per cent of GDP [while] external debt of Turkey is still close to 60 per cent of GDP.

“The tourism sector will not be able to generate the projected foreign exchange income this year. Exports are expected to slow down due to global recession.”

Despite such an unpromising outlook, Mr Erdogan has heralded Turkey’s response to the crisis. “Turkey has fared better than any country comparable in population and threat of pandemic,” he said on Friday.

Although Mr Erdogan has taken pride in not looking for external assistance, Timothy Ash, senior economist at BlueBay Asset Management in London, said the pandemic could provide him with the “cover” to seek support from the International Monetary Fund as forecasts showed Turkey’s economy shrinking by 2.3 per cent this year.

The opposition Republican People’s Party (CHP) claimed that more than 2 million workers lost their jobs and 400,000 businesses closed as a result of coronavirus measures that it said were poorly planned and lacked adequate financial support.

“This current campaign has only led to one thing: unemployment,” party leader Kemal Kilicdaroglu said in a TV interview on Friday.

The CHP mayor of Istanbul has called for the city to be placed under quarantine as hundreds of thousands in Europe’s most populous metropolis continue going about their everyday lives.

The Turkish Medical Association and trade unions have also called on the government to keep people at home across the country and provide more comprehensive financial assistance.

Nearly 60 per cent of Turkey’s confirmed cases have been recorded in Istanbul, a city of 16 million and the country’s economic heart.

Health Minister Fahrettin Koca said each infected person in the city was passing the virus to an average of 16 others, a figure far higher than the World Health Organisation’s global average of 2.6.

Meanwhile, donation drives launched in Istanbul and the capital Ankara, which both fell to the CHP in last year’s local elections, were halted by the government as it launched its own campaign.

On Friday, Mr Erdogan announced new measures to combat the outbreak, including stopping vehicles entering or leaving 31 cities, introducing a partial curfew for people under the age of 20 and forcing people to wear masks in crowded public spaces such as supermarkets, workplaces and public transport.

Turkey had already closed down international flights, limited domestic travel, shut cafes, bars and schools as well as suspended sports events and religious gatherings. However, many workplaces remain open.

The dilemma for many Turkish workers was highlighted last week by a truck driver from the southern province of Hatay who criticised the government’s call to stay at home.

“I can’t earn my bread if I don’t work,” Malik Yilmaz said in a video posted on social media. “I can’t pay my bills and rent. Not being able to pay these is worse than dying. It’s better if I die.”

He was arrested and later released for “inciting hatred and enmity”, according to a police statement.

Updated: April 4, 2020 07:14 PM

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