So, how will the IMF's tradition change?
Fatih Özatay, PhD
30 March 2009
While talking about reconstruction of institutions like the IMF and the WB and redesigning the global architecture, in the G-20 meeting to be held in London it is beneficial to address two points that are less assertive will be highly important for countries like Turkey. Both points are closely related with each other: Grading systems of credit rating agencies and how the new opening of the IMF will accord with the IMF culture.
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Main reason behind the perception delay
Fatih Özatay, PhD
29 March 2009
There are various features distinguishing the latest crisis from the previous ones (1994 and 2001 crises). The previous ones originated from Turkey, current one originated abroad. This crisis implies that the amount of capital transferred to Turkey and similar countries will decrease significantly. As estimations suggest, the amount of funds will fall down from 900 billion USD in 2007 to 200 billion USD in 2009. On the other hand, in previous crises, Turkey managed to attract capital thanks to the programs implemented. Now, even if we implement a comprehensive program, the amount of foreign capital that can be attracted is quite limited.
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It is never too late to mend
Güven Sak, PhD
27 March 2009
For the last three days we have been talking about the negative impacts of the global crisis on Turkey and how these impacts can be limited. Actually, it is possible to say that this subject is depressing. While we were discussing on growth strategy only two years ago, the recent subject is successful management of the contractionary period. Crisis management mainly means ensuring that the economy nowadays will contract orderly. In this context, crisis management does not refer to the elimination but limitation of damage. We have two options: Either the crisis will manage us or we will manage the crisis. Former will incur more damage. This is the first point the study carried out by TEPAV reveals.
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For those waiting at bus stops
Fatih Özatay, PhD
26 March 2009
An expression in the election campaign was quite impressive and was based on the distinction between 'those riding jeeps and those waiting at bus stops'. While I was writing this story, television news announced that fifth measure package will be announced. It is said that the core of the package will be formed of the establishment of a loan guarantee system that was the top priority in the to-do list referred to in this column since September.
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We will spend; but for what?
Fatih Özatay, PhD
22 March 2009
80 percent of the production of the automotive sector is directed to exports. As it is considered that the tax cut has nothing to do with exported products, it is immediately identified that the announced measures is related only to one-fifth of the total production of the sector. On the other hand, more than half of the vehicles sold in domestic market are imported. Therefore, tax cut is to a high degree in favor of imported vehicles.
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Did you see the logo of Recovery Program?
Güven Sak, PhD
21 March 2009
Sometimes, how do you do something might be as important as that thing itself. The campaign in the US to tackle the crisis, which also involves the struggle against the crisis psychology, is an example for this. Have you seen the logo of the campaign to tackle the crisis carried out under the scope of the "American Recovery and Reinvestment Act"? They have established a campaign that has an institutional identity. Let us show you this campaign and its logo as a whole. Let us identify what the campaign involves and what we fail to do so that a clear picture appears in your minds. Because this issue becomes more prominent in the current period where the Turkish government has found the "correct path" and started to move in the right direction.
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Tax cuts and devil’s attorney
Fatih Özatay, PhD
19 March 2009
For a long time, measures to recover sectors that go through hard times due to the crisis have been insistently demanded. Furthermore, it was argued that the government is to focus on measures of this type. Recently, tax cuts were introduced for some products and the media started to publish stories on how the number of car trucks departing from Bursa increased and on the consumers forming queues in front of retailers.
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“Man, is the crisis ending?”
Güven Sak, PhD
19 March 2009
No, it is not. What makes you think so? It is not even close. That the Turkish government has finally started to move in the right direction is not enough. There are still a lot of steps to take and a series of measures to be implemented. It is impossible to conclude "man, is the crisis ending?" solely relying on the rise in demand for automobiles after tax cuts. This is a flash in the pen. Nonetheless, it also involves a good message.
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Turkish government is finally moving in the right direction
Güven Sak, PhD
17 March 2009
Finally, news stating that a set of steps considering the troubled sectors will be taken has been spreading around. In fact, we do not know what is going on exactly since there is no official statement yet. However, as the items leaking of the package are considered, it seems that the denial period ended. The government now gives the impression that it is moving in the right direction. However, finally starting to move in the right direction does not necessarily mean reaching the targeted destination. The crisis is still present and it is certainly the crisis of Turkey now. What is pleasing is that the "deeply sleeping beauty" has finally waked up. At this point, this is what we must feel happy about. The crisis, has taken the attention of the Turkish government for the first time since Se
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Low interest rate-high exchange rate: current account surplus
Fatih Özatay, PhD
16 March 2009
When there was no global crisis, the main focus of this column was how the economic problems of Turkey can be dealt with. The results of the studies and discussions carried out by a group of colleagues elaborating on these problems were frequently reflected in this column.
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