Dark days for Turks as Erdogan atones for economic errors
After years of inflation crisis, new pain from rate hikes
Policy showing successes but deepening poverty for some
Retirees, workers mourn diminished living standards
Test of Erdogan's popularity and patience with programme
By Birsen Altayli
ISTANBUL, July 18 (Reuters) -Many Turks feel anxious and ashamed about their eroding living standards, paying the price for President Tayyip Erdogan's past economic missteps even as there are signs that the country is beginning to exit its cost-of-living crisis.
Six years of punishing inflation, combined with a sharp clampdown on credit over the last year, has given retirees and salaried workers a chilling brush with poverty, data shows, testing Turkey's social fabric more than at any other time during Erdogan's more than two decade rule.
Turks say they are now slipping cash to retired parents and grandparents, in a reversal of Turkish custom, even as they themselves struggle to pay monthly bills and forgo modest luxuries such as restaurants.
Erdogan has urged patience but 2024 is emerging as the most trying in a generation for Turks, whose economic fortunes have rapidly deteriorated since the first in a series of currency crashes in 2018.
"I may still be walking, but I am not really living," said Fettah Deniz, 73, whose monthly pension of 13,000 lira ($393) is three times below the designated poverty line of a person in his situation, so his children help him out.
At holiday gatherings he has even avoided his grandchild because he had no extra cash to give - "the plight of many honourable and traditional people in our society," said Deniz, who helps run a retirees association in Istanbul's working class Bayrampasa neighbourhood.
Another retiree, Mustafa Yalcin, 69, said he stayed overnight in a hospital during a trip to Gaziantep because he couldn't afford a hotel and didn't want to burden relatives there who would feel obliged to feed him.
The government proposed a boost this month that should raise the average monthly pension to about 14,000 lira from 12,000.
More than half of workers meanwhile live on or around the minimum wage of 17,002 lira, which is not expected to rise despite calls from the political opposition.
That compares to an estimated poverty line that has shot up to 61,820 lira ($1,870) for a family of four in Ankara, Turk-Is, a top union, said in a report last month. Another union, DISK, found that last year's average pension was one-sixth of those in central European countries.
REINVENTING ERDOGAN
Such hardship could erode support for Erdogan, pollsters say, especially after pensioners helped hand his conservative AK Party its worst ever loss in March local elections.
As the economy slows further and employers trim jobs as expected in coming months, it could also test Erdogan's patience with the turnaround programme that he launched last year when he picked Mehmet Simsek as finance minister.
Since June 2023, the central bank's new leadership has hiked interest rates from 8.5% to 50% - the highest in emerging markets - in order to cool inflation that topped 75% in May.
It's a shock reversal of the preceding five years in which Erdogan - describing himself as an "enemy" of interest rates - pushed an easy-money policy to boost economic growth despite soaring prices, and sacked five central bank governors.
Largely as a result of this unorthodoxy, the lira shed more than 85% to the dollar since 2018, foreign investors mostly fled the country and FX reserves touched all-time lows before finally rebounding this year.
Erdogan has repeatedly backed the new programme, while the central bank says rates will remain high. Analysts say inflation began what will be a sustained fall in June, while ratings agencies have upgraded Turkish assets and many foreign investors have returned.
'TRAPPED'
But on the streets, fallout is harsh.
Silan, 28, has earned regular pay rises working in the private sector but says she still cannot live comfortably in Istanbul on only 50,000 lira a month and cannot afford to leave.
"I feel trapped," she said. "It's not possible to live the life we think we deserve."
Renters and landlords often quarrel bitterly over prices given housing inflation nearly doubled over the last year, while house prices jumped nearly 50%, data shows.
In Istanbul, restaurant prices are approaching those of London and Dubai.
"Eating out and vacationing is entirely out of the question," said Aynur, 58, who works at a financial firm.
"You don't want people to come over because you can't afford to host them. My social life has ended."
A recent poll by Konda found half of respondents could "barely" make ends meet, while 30% fared worse still. Some 83% said Turkey was in an economic crisis.
The rate hikes have left credit unaffordable for many, but have also left lira deposit rates attractive for those with assets. The annual rate has roughly doubled to more than 60% in a year, data shows.
Gulseren, 64, said she sold a few properties in Izmir and invested in some high-interest accounts "to maintain" living standards. "But even this is not sustainable because our total savings are also diminishing against inflation," she said.
($1 = 33.0689 liras)
Deposits pay the bills, if you've got the money https://reut.rs/4d9hlQd
Expenses and wage gap https://reut.rs/3Sej3Yh
Gaping cost crisis https://reut.rs/3y1wOCM
Reporting by Birsen Altayli; Additional reporting by Can Sezer and Jonathan Spicer in Istanbul and Zeynep Berkem in Ankara
Editing by Gareth Jones
免責聲明: XM Group提供線上交易平台的登入和執行服務，允許個人查看和/或使用網站所提供的內容，但不進行任何更改或擴展其服務和訪問權限，並受以下條款與條例約束：（i）條款與條例；（ii）風險提示；（iii）完全免責聲明。網站內部所提供的所有資訊，僅限於一般資訊用途。請注意，我們所有的線上交易平台內容並不構成，也不被視為進入金融市場交易的邀約或邀請 。金融市場交易會對您的投資帶來重大風險。
所有缐上交易平台所發佈的資料，僅適用於教育/資訊類用途，不包含也不應被視爲適用於金融、投資稅或交易相關諮詢和建議，或是交易價格紀錄，或是任何金融商品或非應邀途徑的金融相關優惠的交易邀約或邀請。
本網站的所有XM和第三方所提供的内容，包括意見、新聞、研究、分析、價格其他資訊和第三方網站鏈接，皆爲‘按原狀’，並作爲一般市場評論所提供，而非投資建議。請理解和接受，所有被歸類為投資研究範圍的相關内容，並非爲了促進投資研究獨立性，而根據法律要求所編寫，而是被視爲符合營銷傳播相關法律與法規所編寫的内容。請確保您已詳讀並完全理解我們的非獨立投資研究提示和風險提示資訊，相關詳情請點擊 這裡查看。
