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.

In 1994 and 2001, tightening of domestic market was compensated with exports to a certain degree. Nonetheless, now, a significant part of our trade partners undergo economic contraction and the export volume of Turkey falls down accordingly. In particular this second distinction has the potential to be the main determinant of growth performance. On March 9, I referred to the results of a research. If in 2009, Turkish exports of goods and services do not fall down by 10 percent in real terms but remains at the 2008 level; growth rate would have been 3 points higher than the scenario with fall in exports: economy contracted by 3.4 percent rather than 6.5 percent.

Current conditions are significantly different than the past. Both in 1994 and 2001 crisis, we encountered instant speculative attacks. Interest exchange rates jumped up and demand for foreign exchange boomed. Yes; in the background were imperfect economic foundations. However, these imperfect economic foundations were present even six months or one and a half years before the date the crisis emerged. 1994 and 2001 crisis emerged at the exact date they emerged mainly due to the existence of triggering elements. Significant movements were observed in the markets exactly due to those triggering elements.

In 1994, the triggering elements were that Treasury borrowing tenders were cancelled with the desire to artificially reduce interest rates and thus that the Central Bank had to meet the financing requirement of budget deficit. In 2001, legal operations against bank officials, which spread the perception that the banking sector was significantly problematic, and the following "we are faced with a major political crisis" statement were the triggering elements.

Now, however, we do not observe such a situation in the current crisis. In short, there was no speculative attack in Turkey observed back then. Neither was the background that imperfect nor was an instant triggering element encountered. Things evolved slowly. Albeit, the direction and the channels of this evolution was known; these were elaborated on from the beginning. It was at the beginning pointed out that foreign and domestic loan channel will be tightened, export volume will fall down and deterioration of confidence will evaporate domestic demand. While these expectations were presented in newspapers, for instance, no fall in credit volume was observed. As a result, it was stated months ago that the impacts to be transferred via the aforementioned four channels will decrease production and increase unemployment.

Nevertheless, the slow evolution of events, i.e. that no sharp exchange and interest rate changes were observed and in particular interest rates did not jump high as in 1994 and 2001, impeded us to perceive that we are faced with major problems. It impeded us in spite of all warnings.

For production and employment, which are more important for masses, it seems that the negative impacts will be much harsher than in 1994 and 2001. Nonetheless, there is no doubt that this forecast will be valid if 'current conditions' remain valid. Whether or not a certain part of current conditions will remain is out of our control. On the other hand, there are also things we can control. In terms of control, current government is observed to make a move. The only thing we can do is to hope that these moves will continue.

This commentary was published in Radikal daily on 29.03.2009