Facts about Turkey prior to the June 24 elections

Published 14.06.2018 21:25

The budget's revenue from the debt restructuring and relief for illegally constructed areas and houses in Turkey totals TL 70 billion ($15 billion). Despite this figure, the claims that the "budget is deteriorating in Turkey" and "unnecessary expansionary fiscal policies are implemented" should no longer be valid.

As an answer to those claiming these implementations are for one time only, I do not know whether the growth-related recovery on the budget's revenue side and the saving's measures to be taken after the elections on the spending side will be sufficient.

This week, President Recep Tayyip Erdoğan also pointed to the budget revenues increasing with the growth and explained how they returned to the public as investments. Turkey's budget performance reflects growth on the overall prosperity and general economic equilibrium over the years. This is a social feature that does not exist in any country today. But what is clear is that Turkey seems to be one of the few countries in the world in terms of budget stability and sustainability in both 2018 and 2019. It is already clear that the budget targets are going to be achieved.

We never discuss the ratio of public debt to GDP for Turkey. Here we know that Turkey has one of the lowest rates in the world (28.3 percent).

In the meantime, Turkey is among the world's least indebted countries in terms of the total indebtedness/GDP ratio. Here the private sector's recently increasing debt is discussed. The national income rate of the private sector borrowing is 68 percent, and there is no short-term open position as external debt here. All these rates are below the world average for the private sector as well.

Of course, there are oddities that our national accounting system cannot measure here, which are included in the short-term external debt of the private sector. For example, the engine imports of a foreign car company engaged in the production in Turkey from the main center are Turkey's short-term external debt until the book entries are closed. In addition, credit-like entries received by firms in return to international banking are considered as short-term external debt.

In contemporary international/national accounting calculations, calculations, that will not create a real effect at the end of the day and will be corrected with a book entry, are extracted from foreign trade accounts. Many developed countries are doing this. But even if we accept these repeating and fictitious oddities as real, external debt of Turkey cannot be of concern.

But despite this, what is being done for this black propaganda, while these figures are on the table, there is not even the slightest sign of a debt crisis for Turkey; on the contrary, the developed countries' level of indebtedness to the national income is around 200 percent?

We will answer this question, but let's also add this distortion: "For example, Japan and the United States are the most indebted countries in the world compared to the national income, but they do not have debt turnover problems, yet you might have." So where will the capital go? Is it to Europe, where negative interest rates, financial and political instability are on the rise again, or to Pacific Asia, which is now saturated in growth? Turkey, undoubtedly, will be one of the few countries in the world with strong political and financial stability after the elections. Today, Turkey is one of the few countries in the world to which the global capital will go whether it likes it or not.

It is clear why and by whom this kind of black propaganda is done through the exchange rate and the lie of indebtedness despite our floating exchange rate regime, and who has willingly become a part of it. All I ask is that while these facts are so clear, aren't the people telling these lies and writing them repeatedly in their reports, deceiving the investors by serving as economic shooters?

However, the facts about Turkey do not stop there. In terms of both human capital and energy and market, Europe is now in need of and dependent on Turkey.

With the first gas recently given to the Trans-Anatolian gas pipeline (TANAP), Turkey's European dependence finished, while Europe's dependence on Turkey began. As TANAP is the backbone of the Southern Gas Corridor, it is the only energy corridor that will consolidate the Mediterranean energy basins and take them to Europe. As such, gas producer countries other than Azerbaijan will have to be involved in this project. Also, the project that completes TANAP in the north is TurkStream carried out by Russia and Turkey. So, Europe is now dependent on Turkey in energy with both northern and southern axes.

Meanwhile, projects such as TANAP are a response to the notion that thinks of economy nothing more than financial markets and sees economic stability and even economic development as financial-capital efficiency.

Ensuring the passage between Azerbaijan-Georgia and Turkey in this way and the direct access of the Azerbaijani gas to the European market outside Turkey is not only an energy move. Turkey does not regard this project solely as an energy project and but sees it as a project of peace, democracy and integration.

Another project that completes TANAP is the Baku-Tbilisi-Kars (BTK) railway project. This project is also the most important line of the New Silk Road. The BTK does not merge three countries alone like TANAP, but is also one of the main commercial exit-transportation projects of Asia and Europe, especially Kazakhstan and Turkmenistan ports. Central Asia is connected to Turkey (Marmaray) across the Caspian with BTK. This line, along with the Southern Gas Corridor with TANAP as its backbone, will link ports in the China Sea to Europe via Turkey.

The world economy and politics are moving toward a great integration. Do not mind people like Donald Trump rowing against the tide. Their protectionist delusions will be cut short. We are heading toward capitalism in which structural differences such as economic efficiency, technology, labor costs, infrastructure, the environment and education will gradually be removed on the global level. Turkey will respond to this major change with a new presidential system.

But the interesting thing is that none of the opposition parties and the leaders opposing Erdoğan at the rallies are aware of this fact. They do not even know what to do and what to manage when they become the head of the state.

However, as part of the black propaganda, they make promises that they will never be able to keep. Today the burden of the Republican People's Party's (CHP) populist promises on the budget is $250 billion. There is no program or strategy in front of the CHP. Their election declarations are copy-and-paste texts collected from here and there. Erdoğan's victory on June 24, from this perspective, is also the beginning of a major transformation not only for Turkey but also for the Eurasian geography.

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