We have been stuck in the middle-income trap for a long time, whereas our goal was to become an economy where per capita income hovered around 20-25 thousand dollars, gross domestic product approached 2 trillion dollars, exports exceeded 500 billion dollars and price stability was achieved. We realized that this was not going to happen with the two-forward-one-backward growth. What should we do to get out of this trap and march towards the target? Here is a set of recommendations:
– The main priority of our economy should not be to achieve high growth at any cost. The goal should be for our people to live in happiness, freedom, prosperity and self-confidence.
– This depends not on short-term economic gains, but on long-term progress in science, technology, culture, arts and sports, sustainability, inclusiveness and the development of employment opportunities that will provide decent living conditions.
– A strong market economy is characterized by a strong institutional structure and a sound legal system.
– In strong market economies, predictability in governance and decision-making is essential. Transparency and accountability are guaranteed. Separation of powers and checks and balances mechanisms should work effectively. Pluralism, not majoritarianism, should be emphasized.
– Regulatory bodies should be autonomous. Appointments should be based solely on merit.
– There should be no room for favoritism and patronage in economic decisions; decisions should be based solely on economic variables.
– Emphasis should be placed on maintaining macroeconomic stability. Generally accepted monetary and fiscal policies should be pursued to ensure macroeconomic stability.
– Technological progress, which is the main source of productivity and social welfare increase, should be paved the way. Growth processes that are not based on technological progress are puny, unbalanced and not sustained.
– Social safety nets and social welfare programs should be strengthened to alleviate income inequalities and increase inclusiveness.
– We must succeed in the fight against inflation, which is the reason behind the economic problems of the past period.
– The economy must be formalized and rule-based. Competition must work properly. Corruption and black money must be effectively combated.
These are the proposals that will take Turkey out of the middle income trap and into the upper leagues. I took these suggestions from the speech made by Tuncay Özilhan, the President of the TÜSİAD High Advisory Council, at the council meeting last week. He is the president of one of the leading organizations of the business world, but there is no one who would not sign these suggestions, from labor unions to civil servant unions, from farmers to all employees.