Terror costs 1.2 trillion liras to Turkish economy

Sadi Özdemir ISTANBUL

Recent moves in the peace process between the government and the outlawed Kurdistan Workers’ Party (PKK) are expected to have significant positive effects on the Turkish economy, as the country is estimated to have lost around 1.2 trillion Turkish Liras ($478 billion) after years of clashes with the PKK.

Turkey spent 162 billion liras on defense before 2012, when the peace process was initiated. The figure is around 495 billion liras upon today’s valuations. If the country had not been involved in armed clashes, Turkey would have spent almost half of the figure, according to estimates. Turkey’s interest expenses were 1.6 trillion liras between 1986 and 2012. If there had been no terror in the country, the interest rates would have been lower and Turkey would have saved around 80 billion liras during that period, according to analysts.

It is also estimated the country would have grown 0.5 percent higher annually between 1986 and 2012 if the clashes with the PKK had not been the case. Losses in economic growth are estimated at 2.3 trillion liras in the mentioned time period.

Armed clashes in the southeastern region of Turkey largely impacted the development potential of the region, as thousands of people moved from their hometowns to larger cities to live in safer conditions and to find jobs. The country is estimated to have paid 78 billion liras to these families in social support. Armed clashes are also responsible for a loss in the country’s tourism income, estimated to be 120 billion liras between 1986 and 2012.