'Contrary to humanity' reaction to the discussed minimum wage hike rate: 'It will not create an inflationary effect'

With the approach of the new year, the eyes of millions of workers have turned to the upcoming minimum wage hike. While many statements have been made on the subject, it was recently stated that Central Bank Governor Fatih Karahan made an assessment.

While a statement also came from the IMF side suggesting that a hike at these rates would be reasonable, economist Mahfi Eğilmez reacted to this rate with his own statement.

Eğilmez said, "Wages can increase inflation, but not increasing wages is also contrary to humanity. You promised me 100, but by the middle of the year my purchasing power dropped to 50; bring me back to 100."

25 PERCENT ASSESSMENT FROM THE CENTRAL BANK GOVERNOR

Central Bank Governor Fatih Karahan met with investors during his visit to the US. It was alleged that Karahan made assessments regarding the minimum wage there and suggested a 25 percent rate for the minimum wage hike.

IMF ALSO EXPRESSED AN OPINION AT THE SAME RATE

Following Karahan, IMF Turkey Mission Chief James Walsh made assessments on the subject and publicly shared a 25 percent proposal for the minimum wage hike rate.

REACTION TO 25 PERCENT PROPOSALS

The 25 percent rate mentioned in the successive statements drew the reaction of renowned economist Mahfi Eğilmez. Eğilmez made statements on the subject in the "4'te Ekonomi" program broadcast on CNBC-e.

"NOT INCREASING WAGES IS ALSO CONTRARY TO HUMANITY"

Opposing the IMF's 25 percent proposal, Eğilmez used the expressions, "Yes, wages can increase inflation, but not increasing wages is also contrary to humanity. You promised me 100, but by the middle of the year my purchasing power dropped to 50; bring me back to 100."

Eğilmez included the following statements in his assessment of the subject:

"This is a demand, in my opinion, a very logical and correct demand. Now you are saying, 'Don't increase the minimum wage that much, don't do this,' but unionization has already fallen; it has fallen all over the world, and it has fallen in Turkey as well. So, I absolutely do not agree with the IMF here.

"IT WILL NOT CREATE AN INFLATIONARY EFFECT"

If a wage that was 100 liras at the beginning of the year is 100 liras, and if there is 50 percent inflation and this person's wage purchasing power has dropped to 50 liras, when you add 50 to it and bring it back to 100, this does not create an inflationary effect. Because that was the purchasing power at the beginning of the year. We are just giving back the same purchasing power."

News Source: 12punto