Prof. Dr. Duran Bülbül: 'Inflation in Turkey is around 100 percent!'

Hazal Güven - 12punto.com.tr

May inflation figures have been announced. According to the Turkish Statistical Institute (TÜİK), annual inflation was 35.41 percent on an annual basis, while it was 1.53 percent on a monthly basis. As in every month, the gap with the data from the Independent Inflation Research Group (ENAG) did not close this month either. According to the measurements made by ENAG, annual inflation in May was 71.23 percent. May inflation was 3.66 percent. 

Evaluating the announced figures for 12punto, public economist Prof. Dr. Duran Bülbül said, "In an environment where the facts are as they are, announcing such an inflation figure can only be done to create the perception that 'the economic program is going in the right direction.' In a sense, these are figures consistent with the statements of the Minister of Treasury and Finance, Mehmet Şimşek. However, this never reflects the truth." 

Stating that when looking at the available data, the situation will become even more dire for citizens in the coming days, Bülbül made the assessment, "I am of the opinion that by the end of June, that is, by the end of the 6-month period, the crisis in the country will flare up significantly, the crisis will increase further, and purchasing power will decline even more. As a result of these, bankruptcies in companies will also be inevitable." 

Bülbül used the following expressions: 

'POLITICAL CRISIS AFFECTED THE PROGRAM'

"First of all, it is necessary to determine this; in particular, the government and the financial management have a program to reduce annual inflation. Along with this, there is a program to lower interest rates. However, as you know, a political crisis emerged with the arrest of Istanbul Metropolitan Municipality Mayor Ekrem İmamoğlu in March. This, in a way, significantly affected the projected interest and inflation figures while the inflation was falling in real terms and the foreign exchange was falling in real terms as well. 

Thus, we have returned to the point of two years ago. The most fundamental problem here is this; in particular, there was a shift of burden onto the public, and the way to ensure stability was achieved by placing the burden on low-income earners. Ultimately, this program is a program where the public pays the bitter pill. 

'TÜİK IS NOT ACTING IN ACCORDANCE WITH REAL INDICATORS'

We saw that because this work could not regulate the economy in a structural way, it was built only on inflation, foreign exchange, and interest rates, so it deteriorated at the first shock and we went behind the points where we started. While the Central Bank was significantly increasing its net reserves, we saw that these reserves melted in a short time in order to intervene, and as a result of this melting, the price was paid significantly by the people I just mentioned, that is, the poor, the retiree, and the minimum wage earner. It is precisely at this point that we saw interest rates rising again, and along with this, inflation and foreign exchange rising. Besides this, we saw that TÜİK has acted in accordance with this program, especially in the last 2 months, but has not acted in accordance with the real reality of the economy. If TÜİK had announced real inflation, if it had announced an inflation rate in accordance with the reality of the economy, it would have had to announce these inflation figures at around a minimum of 70 percent today. But we see that there is almost a 50 percent difference between them. 

'IT MISLEADS NOT ONLY THE PUBLIC BUT ALSO THE GOVERNMENT'

Actually, when we look at these last 3 months, prices do not show a decrease in almost any area. Foreign exchange does not fall either. In an environment where the facts are as they are, announcing such an inflation figure can only be done to create the perception that 'the economic program is going in the right direction.' In a sense, these are figures consistent with the statements of the Minister of Treasury and Finance, Mehmet Şimşek. However, this never reflects the truth. In this sense, TÜİK is not only misleading the public. TÜİK is also misleading the political power from taking the right economic policies. If TÜİK had really announced these figures correctly, the economic management, the political power, and the Central Bank management would have foreseen a correct economic policy and made a program accordingly. The announced inflation figure does not reflect the truth in any way. They only announced an inflation figure consistent with economic programs, and for that reason, one must ask; a crisis occurred in March. But prices increased in every area until May. How can you announce such an inflation in the other two months? 

'INFLATION IS AROUND 100 PERCENT'

If they had really announced an inflation rate in accordance with the reality, it would be around 100 percent in Turkey. In a real sense, the public's inflation is at this point. Anyone who sits down and does a simple math calculation can find this. I am of the opinion that by the end of June, that is, by the end of the 6-month period, the crisis in the country will flare up significantly, the crisis will increase further, and purchasing power will decline even more. As a result of these, bankruptcies in companies will also be inevitable."

News Source : Hazal Güven