Domestic debt interest increased by TRY 1.3tr in five months: OPINON 


The domestic debt has reached an incredible level and we do not know to what stage it will reach during the election period. We should ask all political parties: What kind of policy do you have, or do you have any policy on this issue? Of course, the AK Party is responsible for this situation, so they are aware of the truth. I doubt whether the opposition is aware of this problem or not.

This picture is so dire that it needs to be talked about for days and is an invaluable source of criticism for the opposition.

However, they probably don’t even realize that they don’t even bring this publicly available data to the agenda. 

The domestic debt principal and interest payment projections are announced every month by the Ministry of Treasury and Finance. The total interest to be paid exceeded the principal total for the first time in the history of the Republic when the April data were announced last month. 

The ministry announced the data for May at the end of last week and the interest payment is going up.

As of May, the total domestic debt principal to be paid by the Treasury is TRY 1.5tr. So, how much is the interest to be paid for this principal? Exactly TRY 2.53tr. 

The meaning of these figures is that the Treasury will now pay TRY 3.6tr, including TRY 1.5tr in principal and TRY 2.1tr in interest as of May, even if it does not borrow any money at all!

But that’s not enough!

The amount payable may increase; both principal and interest even if no debt is borrowed. 

Because some of the borrowings are in foreign currency and some of it is indexed to foreign currency… Therefore, the principal is not fixed in these borrowings, the amount may and probably will increase according to the exchange rate on the payment date.

Talking about the interest rate, it is not fixed at all. 

Isn’t it obvious that interest rates are fluctuating anyway?

Look at its current level, the total interest to be paid last December was only TRY 795bn. 

Five months have passed, and we come to May, the interest to be paid has increased by TRY 1.3tr and approached TRY 2.1tr. A full 158% increase from December to May.

How much has the principal liability increased during this period?

It increased by TRY 188bn and 14%. 

Excellent domestic debt management should have been implemented (for the lenders!) to achieve this. 


You didn’t get a fixed-rate loan, you couldn’t get it, because the lenders couldn’t trust you, they wanted to guarantee themselves in terms of interest rate and gave the debt either indexed to foreign currency, in foreign currency, or indexed to CPI.

As such, each increase in foreign exchange and CPI multiplied the interest expense. 

 Here is the situation!

 The Treasury of the Republic of Turkey has pursued such a domestic borrowing strategy that the interest burden has increased by TRY 1.3tr in just five months.


The interest rate burden of the domestic debt surged by TRY 273bn in January, TRY 136bn in February, TRY 144bn in March, TRY 396bn in April, and TRY 310bn in May. The 5-month hike is TRY 1.25tr. 

Now, everybody should take a bite of the reality sandwich and calculate! 

– If we had pursued a proper economic policy…

– If we hadn’t reduced the interest rate that will have a way of raising inflation instead of decreasing it…

– If we hadn’t paved the way for the Treasury to borrow in CPI indexed at a higher interest rate CPI as we reduced the policy rate…

– If we hadn’t weakened the Treasury of the Republic of Turkey that much…

What would have happened?

-That surge in interest rate burden in five months would have been TRY 200bn at most.

-We wouldn’t have shouldered an extra burden of TRY 1tr. 

-We would have held TRY 1tr in a sense. Let’s assume that this TRY 1tr will be paid in 10 years. So, we would have held TRY 100bn for each year. 

– Now sit and calculate how many bridges, hospitals, and schools would have been built and how much support would have been provided to farmers, tradespeople, workers, civil servants, and retirees with that TRY 100bn every year…

But more importantly, ask yourself for what cause you have been deprived of all this and whom this money goes to as you don’t receive it. Then, answer this question sincerely… 

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