Government trying to boost economic morale, but…

We cannot say that the government has been very successful in its attempts to boost morale regarding the economy. Since the day it was formed, the government has been trying to create the perception of a “reformist government,” and thus is making plans to increase growth rates by attracting foreign capital. 
Recently, the government has been trying to revive this effort. The government took the surprise step of publicly employing sub-contracted workers within the context of the three-month reform program. Through these measures, it was trying to set an agenda but its effect was short-lived. Because political developments continued to change the agenda while the relevant regulation had not even been prepared for their workers’ employment. Meanwhile, it could even be expected that the business segments complaining about the minimum wage might increase their complaints about the regulations on subcontracted workers. We should also say that this practice has the risk of increasing the public burden. 

Recently, members of the government started saying that additional measures would be taken to improve the investment environment and that they were working on them.  

In addition to this, in order to curb the troubles experienced in tourism, following the shooting of the Russian plane and the succeeding terror incidents, the government is reported to be working on new measures. It is feared that a drop in tourism revenues will increase the current account deficit and the foreign currency input, thus multiplying economic troubles. 

With all these in mind, the government wishes to recover the morale and stop the decline in the business environment preventing the inflow of foreign capital. Recently even the businessmen known to be close to the ruling party have started mentioning the decline in the business environment and the impossibility of actualizing long-term targets. 

The real sector companies that are in difficult positions have become quite visible in the recent past due to high devaluation rates and standstill growth rates. Demands for suspension of bankruptcy have increased as well due to abuse of these rates. 


Bank complaints

It does not end here. Troubles in the banking sector, one of the fundamental pillars of economic stability, are now publicly being voiced. For some time, there has been trouble with credit back payments. The practice of suspending bankruptcy is increasing troubles and complaints. Sector representatives are saying that profits are low compared to capital and this would affect the credit volume. Despite this, they are demanding that regulations in the sector be moderated.

In sum, while the global economic circumstances are toughening, destabilizing tendencies are added to these worries with the mistakes of the administration; the economic morale has further declined with domestic and foreign political mistakes. 

The government is trying to boost morale with additional measures but obviously this will be difficult to achieve without making deep-rooted changes in its current policies.