TUSIAD HELD A HIGH ADVISORY COUNCIL MEETING WHERE THE ORGANIZATION CRITICIZED THE GOVERNMENT’S ECONOMIC POLICIES. PRESIDENT RECEP TAYYIP ERDOGAN RESPONDED TO STATEMENTS MADE AT THE MEETING, SAYING THAT TUSIAD SHOULD NEVER ‘KNOCK ON THE DOOR’ OF THE GOVERNMENT IF IT CONTINUES WITH THESE CRITIQUES.
The era of competition using a cheap TL and labor is over: Orhan Turan
Speaking at the High Advisory Council (YIK) meeting of the Turkish Industrialists’ and Businessmen’s Association (TUSIAD), Organization President Orhan Turan pointed out that the era of gaining competitive advantage in exports with cheap TL and a cheap workforce is over. Instead, he said, Turkey must create high added-value with highly-qualified workforce and technology. Highlights from Turan’s speech are as follows:
►Policies designed with the logic of competitive exchange rate, high exports and current account surplus, but which do not adequately match today’s development understanding and practice, are not yielding the desired results in terms of development. Growth alone is not enough for development. As we grow, we are getting poorer.
►While the whole world prefers to step on the brakes by increasing interest rates in the fight against inflation, we have been following a monetary policy for a long time that not only causes the exchange rate to rise and debts to go unpaid, but also punishes savers. Compared to peer countries, we are the country with the highest inflation level and risk premium in the world. We think that this is unsustainable and a rapid return to rational policies is critical.
►While the share of the Turkish economy in world income increased from 0.60 percent to 1.24 percent from the beginning of the 2000s to 2013, this share has decreased to 0.8 percent in the last 7-8 years. For Turkey, this is really an unacceptable situation. Incomes are melting rapidly under the conditions created by the economic policies implemented.
►We are moving to a new version of globalization. We are at a time when regional economic clusters and the institutions that will organize them will come to the fore in the context of shortening supply chains, the immigration issue will more prominently affect politics, and the global security architecture will be rebuilt. Turkey will play an important role in almost all of these issues, especially within the Western system. These roles must be managed well.
Our expectation is not to repeat old patterns: Tuncay Ozilhan
TUSIAD YIK Chairman Tuncay Ozilhan stated that they wanted a concrete roadmap for the new period from both the government and the opposition, and said, “Our expectation is not to repeat old patterns.” Ozilhan said the following:
►Tensions between Europe and the China-Russia axis are escalating. The peak of this escalation was with Russia’s invasion of Ukraine. We do not know how the war will end, but we do know that it has already changed the global architecture. Reserve currencies in the world are still the currencies of western countries. Western countries still produce nearly 60 percent of the world economy. It will become even more important which trade bloc we will take part in, what we produce, and how. The perspective of the global fight against the climate crisis will also be decisive in our production decisions.
►The top priority in the economy should be to prevent inflation from getting out of control and then to ensure a permanent decline. Economic problems are not solved by frequently amending regulations. For sustainable policies, it is necessary to listen to the suggestions of experts, technicians and academicians.
►From now on, digital infrastructure, increasing added value in industry and agriculture, and the development of new technology areas should be targeted in resource planning. Accelerating investments and directing them to the correct areas cannot be achieved with a low interest policy. The legal system must also function fairly and effectively. The risk premium for investments rises unnecessarily if there is doubt about the rule of law and the independence of the judiciary.
May TUSIAD never knock on our door: President Erdogan
Reacting to the statements made at the TUSIAD YIK meeting, President Recep Tayyip Erdoğan said the following:
►“If TUSIAD continues on this course, it should never knock on the door of power. I see that you are also controlled by the same power – the CHP. You say whatever the CHP tells you to. So, our door is only open to those who take a local and nationalized stance, it is closed to those who do not.”
►“To the gentlemen of TUSIAD: you cannot teach us a lesson in foreign policy. You’re still an apprentice, you haven’t even become a journeyman…How is it that you are trying to teach this government a lesson? Know your limits.”
►“The current head of TUSIAD says, ‘Export-indexed growth is not everything.’ If there is no growth without exports, you cannot be right. All of these are CHP talking points.”
►“There will be no exports, no growth, only imports? Imports will kill you. Does such a thing happen? If you say, ‘an export based on imports,’ I get it. There are products that are built on imports. But if a country puts exports aside, that country will not work. We are doing this – your logic and understanding wouldn’t be able to handle this work. That is why you have changed presidents twice. You have nowhere else to go.”
► “They say, ‘You need to have academics.’ Mr. Orhan, then, we will ask you which academics we should work with from now on. We will work with the names you give. Look at this president. How pathetic they are.”
