The international media's campaigns on what should be considered a "threat" continues in full swing, along with countries who want to ensure that certain issues be perceived as “threats.” However, the perception of a "threat" can sometimes change according to the geographical location and domestic and foreign political conjunctures the countries are in. For instance, a top threat for the U.S. is cyberattacks, followed by Daesh, climate change, North Korea's nuclear program and Russia's growing power. For the British people, on the other hand, the threats of cyberattacks and Daesh have equal importance. Interestingly enough, despite the U.S. administration's tension with China, China's power is in sixth place as a perceived threat. And is the last for the Britons. South Koreans see climate change as the highest threat and even though high, China's power as the second threat, while North Korea's nuclear program is in the fourth spot.
Of the 26 countries in the recent Pew Research survey I cite here, South Korea, Japan and Mexico are the three countries with the highest scores to perceive the U.S. power as a threat. For South Korea and Japan, they perceive Russia's power as a much lower threat than that of the U.S. while the Mexican people perceive Russia and China as a low threat, they see U.S. power as the second-highest threat. For the Russian people, climate change and U.S. power are the top threat priority areas, while the state of the world economy is perceived as the second-highest threat. Greece, South Korea and Argentina are the top three countries to perceive global economic conditions as threats. The least afraid are Poland, Sweden and the Netherlands. Italy's highest threat, interestingly, is Daesh. This is followed by climate change and the North Korean nuclear program. The perception of the North Korean threat in Italy is almost equal to that of the Americans and 50% above that of the Russian people. For Israel, although the Daesh threat is at the top of the list, with regards to the perception of the Israeli people to see Daesh as a threat, interestingly, they’re second to last among 26 countries. The countries with the highest scores in perceiving Daesh as a threat are respectively France, Indonesia, Tunisia, Italy and the Philippines. The countries which perceive global climate change as the highest as a threat are Greece, South Korea, France, Spain and Mexico. The lowest rate in perceiving the U.S. as a threat is naturally by the Israeli people. Japan and South Korea are two countries that see cyberattacks as the highest threat.
Turkey is not included in the research. However, another study showed that Turkish people perceived climate change as the highest threat. As a country that has been carrying out the most effective fight against all terrorist organizations in the world for the last 40 years, whose exports are breaking records despite the world economy and global trade, that is ready to face tension with the U.S. as a courageous country, no doubt cybersecurity would be the second-highest threat. Therefore, we will augment our cybersecurity units and measures. Rapid economic normalization Following the Central Bank of the Republic of Turkey's (CBRT) Monetary Policy Committee (MPC) meeting on Oct. 24, the decision was to cut interest rates by 2.5 percentage points. Thus, the basic monetary policy interest rate was reduced to 14%. In this case, if there will be another 0.5 or 1 point interest rate cut decision after the CBRT's December meeting, as stated in my previous article on Wednesday, we will end the year at a rate of 13.5% to 13% in terms of the monetary policy interest rate. However, we will undoubtedly make this prediction prior to seeing the November inflation rate. Should November inflation positively surprise us, the CBRT may take another front-loading step in December. Interestingly, international financial experts and foreign economists who weave around or get dragged to a very pessimistic angle or even talk nonsense in terms of pessimism, especially in times where uncertainty goes up, this time, have been more successful than domestic economists on predicting the decision of the PPK’s October meeting. Therefore, as the expectations of foreign economists are already focused in the direction of such a decision, the market has correctly and conformingly priced the CBRT decision to cut the interest rate by 2.5 points. The two-year bond interest rate, which exceeded 26% on May 16, 2019, has fallen by half with the latest decision of the CBRT, forcing to go below 13.30%.
With regards to this, we have now reached a point where we took back 90% of the interest rate hikes carried out by the CBRT in order to weaken the influence of the economic operation that the U.S. launched on Turkey in August 2018 and the related dollar exchange rate operation and to stop excessive volatility in interest rates. We are 0.5 points away from returning to the level of August 2018 and 1 point to fall behind. To emphasize again, if the November inflation also shows a positive outlook and if the CBRT makes another 1.5-point interest rate cut at the December meeting, we can even end the year at 12.5%. This picture shows significant normalization successes in 14 months due to Turkey’s strong immune system and the ability of our banking system to absorb shocks. The CBRT, in turn, is taking all the expected steps without delay in order for this “normalization success” to be reflected on the Turkish economy in terms of investment, employment and the revival of the economy. With the probability of strong positive growth in the last quarter of the year, we are one step closer to the possibility of ending 2019 with positive growth.
About the author
Kerem Alkin is an economist, professor at Istanbul Medipol University. He currently serves as the Turkish Permanent Representative to the Organisation for Economic Co-operation and Development (OECD).