How Deng Xiaoping was mistaken?
Güven Sak, PhD
30 October 2010
China's integration into the global world economy was the biggest project of the twentieth century. When he initiated the reformation process in China, the target of Deng Xiaoping was evident. He sought to quadruple China's growth rate over the two decades ahead. This corresponded to an annual average of 7.2 percent growth. Back then, everyone thought that this was mission impossible. But China's experience proved everyone wrong including Deng Xiaoping. Today let me introduce you Lin Yifu and tell how China mistaken Deng.
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Three Turks hardly make a French
Güven Sak, PhD
29 October 2010
The way to achieve rapid growth in Turkey is to improve urban labour productivity. OK, I do not know how to start. And it is not politically correct to say 'Turk' with a pop. We are at the age of discovering our ethnical identities. This was not so when I was a child. However this is the only way I can put my point. Sorry in advance for the inconvenience.
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Are you aware of the difference in growth process?
Güven Sak, PhD
26 October 2010
A factor which facilitated structural economic growth in Turkey is about to fade out or it will soon fade out. In 1961, the year I was born, approximately 32 percent of Turkey's population lived in urban areas. Back then, urban areas were not as crowded as today. Today I am almost fifty years old and 70 percent of Turkey's population live in urban areas. We have surpassed Italy with respect to urban population. Have you ever thought what this could imply? What Turkey needs is a wiser economic policy management. Let me explain why.
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If it is OK when it is the US, why is it not when it is China?
Güven Sak, PhD
23 October 2010
We are going through an unprecedented period: from exchange rate wars to raw material wars! China's blocking the export of rare earth minerals to Japan in order to exert political pressure became the top agenda item of today. Do you monitor the rare earth minerals debates? I found it quite interesting.
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Tea Party in the US, Strike in France. What about Turkey?
Güven Sak, PhD
22 October 2010
Though seem different at first instance, the reactions in the two sides of the ocean are quite alike. It appears that the crisis and the developments aftermaths lead to different reactions in the two sides of the Ocean. While Americans hit the streets yelling "downsize the public sector, take it out of our lives" French revolt saying "neither downsize the public sector not take it out of our lives." These might appear as reactions in opposite directions at the first instance, but in my consideration they are quite alike. And I really am not happy with this. Let me tell what is that I am unhappy with.
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What has changed in Turkey since 2001?
Güven Sak, PhD
19 October 2010
I do not see any alternative, mission-driven new capital. When I left the old Radikal daily, it was the year 2001. It was a period of crisis. After a nine-year break, I am again writing at Radikal. And it is again a period of crisis. So, if we are giving a start again, let us recall what happened during the break. Let me begin with identifying what has changed since the year 2001.
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How many hours does it take to ride from Ramallah to Beytullahim?
Güven Sak, PhD
16 October 2010
There is no outright answer to this question. This is what our friend Musa told us last week. If you check it on the map, the distance between Ramallah and Beytullahim is around 20 kilometers. However there is no direct answer to the question as to how many hours it takes from Ramallah to Beytullahim. Because both are Palestinian cities under Israel invasion. So, nothing is easy there. Anything can happen at any moment. Have you ever imagined how it could be to live in those territories? This exact commentary is written to help you imagine how it would be to do business in Palestine. It is quite hard to do business in Palestine. It is hard, but not impossible to ensure industrial development in Palestine. But like what I said the day before about Diyarbakir, it is costly to do business in
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What does Gaziantep have that Diyarbakir does not ?
Güven Sak, PhD
14 October 2010
Have you visited seen Gaziantep or Diyarbakir? If you have, you can notice that the former is rich and the latter is poor. When I first visited Gaziantep, I felt myself in Bursa where I grew up. In fact, Gaziantep is now sort of like Bursa, the developed western province. It is the industrial center of the Southeastern Anatolia. It now is. Gaziantep is one of the primary examples to how industry was expanded towards Anatolia following the liberalization reforms of 1980. However, a similar development could not be observed in Diyarbakir, which is at 3-hour distance to Gaziantep. Then, why did the industry, which could reach to Gaziantep bypassed Diyarbakir? What difference does the three-hour distance make? Nowadays in Turkey the main agenda item is the Kurdish issue. And when thinking on t
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It is bad to act like turkeys voting for Christmas
Güven Sak, PhD
07 October 2010
Turkey acknowledged this with the banking crisis of 2001. Before the crisis everyone through that everything was normal. There existed a false common opinion that the unsustainable could in fact be sustained. We believed that the process we were going through was normal. But it was not. That was when I learned you should ask 'Ok, how did this happen?' particularly in such periods. And nowadays I believe that nowadays we should remember how Turkey was driven towards the 2001 banking crisis. The main lesson to be learned from that period is given in the title: It is catastrophic to act like turkeys voting for Christmas. It is useful to occasionally inject uncertainty into the system. It is useful to be cautious in this unsteady period the world witnesses. So, with this lens, it is a good thi
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It is a good thing that which action the Bank will take with respect to the exchange rate is not certain
Güven Sak, PhD
05 October 2010
Central Bank of the Republic of Turkey (CBRT) was to reinitiate regular FX (foreign exchange) purchase tenders. However the announced statement was different than those in the previous FX purchase tender announcements. According to this, the bank could purchase extra FX when deemed necessary. In regular FX purchase tenders, it was known in advance the quantity the bank will purchase and when the purchase will be made. But this time the bank stated that it can carry out 'irregular' purchases. Evidently, the bank says in a way that it can intervene. In fact, the bank could have intervened anytime desired even before. But this time it reminded everyone of this possibility with a strong emphasis. We can say that the bank has broken the routine slightly. This way, everyone started to wonder wha
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