Why is Türkiye more expensive than Europe?

According to the international group Tasnim news agency, nearly a month from The beginning of this year has passed and the people of Turkey are still in economic crisis. 10 months ago, when Erdogan became the president of Turkey for the third time, he promised to reduce inflation very quickly and make the dollar fall below 20 lira.

But now only a few There is still time for the dollar to reach 31 lira and inflation has not come down. It is in such a situation that the unprecedented price of food has put many Turkish citizens in trouble and now the price of food and basic goods in this country is very cheap for European tourists and very expensive for citizens.

In the photo and headline of the front page, Yeni Çağ newspaper compares the unprecedented high prices in the food sector in Turkey to a fire in the kitchen, which is constantly getting hotter and hotter.

Ebrahim Kavechi, one of Turkey’s economic analysts, points out that despite low incomes in this country, the current cost of living, especially food, is even more expensive than European countries.

In an analytical note, he examines the causes and consequences of unprecedented high prices in Turkey and answers the question why high prices are not annoying in Europe, but in Turkey, they have reached an unbearable limit. .

Why is living in Turkey even more expensive than in Europe?

The analytical post of one of our famous economists has been circulating in many social networks for several days. In this note, I will share with you the internet posts of several prominent economic experts so that you can see why they all complain about the high cost of food. Unprecedented high food prices in Turkey wrote: “These days, most of my friends and people around me talk about the high costs of food and drinks in Turkey. The heavy food factor rate cannot be justified solely by relying on inflation. No one can convince me that the average price of 75 lira for a small piece of bread with cheddar cheese test is a reasonable price. What is really going on in Türkiye and why should it be so? Let me give some answers to this problem: I shared the same question with Saadi Ozunoglu. He answered me like this: I live in Germany. Believe me, the price is the same in Germany. But here is the difference: the annual income per capita in Turkey is only 10 thousand dollars, but this rate in Germany is defined as 50 thousand dollars!”

Of course, the problem is not only the high cost of materials and Sometimes they refer to points that are not really understandable. For example, another Turkish economic analyst, Gokkhan Ishikman, wrote: “In a local restaurant in Bursa, they wanted 575 lira for a meat cutlet. I did some calculations and saw that 180-200 grams of meat was used, and other ingredients and side dishes were worth 70 liras. I asked what is the justification for this huge price difference? They gave a vague answer as follows: Our current and operating costs have increased! In the science of economics, there is no explanation for these words.”

Yalchin Kochmaz also wrote: “We drank a simple cup of tea at Mudanya Cafe for 40 lira! Sorry! I am not talking about the expensive areas of Bodrum, Bebek and Bostan Road. This is the rate of a typical traditional Anatolian style cafe”.

I also saw these sentences in Storm Jumert’s post: “Please don’t take what I’m about to write as a rant. I have lived in London for a long time and I still go there. But the price of a quality meal in London is now almost equal to Istanbul, while London is among the 10 most expensive cities in the world.” Is: “Only London? It is the same for the expensive cities of Spain. In the past, we used to say that everything is expensive because of taxes. But now even imported products, from food to textiles, reach us at a price that is much more expensive than the Euro rate”. Dahim posted a photo of his purchase invoice and wrote: “I took this photo 2 days ago. 1 kg package of oranges = 1 pound (38 liras); Pineapple 1 lb. Food prices in London are higher than in Istanbul! While the price of each kilo of oranges grown in Turkey is 3 lira in the garden, it reaches 45 lira in the market. Is it just the added shipping cost or are the brokers also setting fire to people’s warehouses? Don’t they have a shipping fee in London? Many fruits are imported from other countries, but they reach people at a price that is lower than the equivalent price in Istanbul. registered Lemons, oranges, grapefruits, and tangerines were priced so low that they were literally left on the branch and not even profitable to pick, but even this cheap fruit is more than 10 times more expensive when it reaches the market. Be it!

In December, according to the report of the Central Bank of Turkey, the market price for oranges is 5.82 liras, tangerines are 4.66 liras, limes are 5.24 liras, and grapefruit are 5.72 liras. Lire announced.

In the TV reports, we see the protest of many farmers who are ready to give up their fields for free. We see products from oranges to tangerines, from lemons to grapefruit rotting on the ground, and it’s cheaper than free! Now my question is: how is it possible that the same orange, which in Turkey and in the garden, costs between 3 and 5 liras, can be sold in the market between 30 and 45 liras and is more expensive than the price of the fruit in London?

Let’s expand our question based on the salary comparison of Turkey and England: the minimum wage in England is about 1200 pounds, which is equivalent to 45 thousand Turkish liras. Meanwhile, in our country, we have just raised the salary to 17 thousand liras! The more strange question is: Why is the apartment rental rate in Istanbul even more expensive than London?

Why did I bring up this discussion? I want to tell you that our main problem in Turkey is not low production. Many economists in Turkey say that the main problem in our economy is the low rate of production. But this is not the case in the real world. The producer offers high-quality oranges in high quantity and tonnage at the price of 5 lira, but when it reaches the consumer, it is 700% more expensive!

Do you think this Astronomical and disturbing differences are only in the food sector? No.

The same is true in the field of education. For several years in Turkey, private school fees have skyrocketed and prices have increased several times inflation. But the market of establishing private schools in Turkey is completely free and unsupervised, and any entrepreneur can enter this market, set a high rate and take a few pieces of this big cake!

You might ask: Why then isn’t everyone attacking the market to build new schools? It is not so. In just a few years, several private schools have gone bankrupt. So where is the problem? The problem is that the rate of inflation in Turkey has such a strange acceleration and the course of its movement is so stunning and unpredictable that even with astronomical profits, no one can keep up with inflation!

For example, our inflation rate, which was around 15% in 2021, suddenly reached 85% within a year, without any reasonable forecast, under the influence of the one-time decisions of the president.

Be careful! We are not talking about an increase in the inflation rate from 75% to 85%, we are talking about a sudden change and a huge shock called 15% to 85%! This has not happened in any other country.

This is a big shock and it is not predictable. Remember the last election. Our inflation, which was around 40% in May, has now reached 65% and will soon reach 80%. Do these strange and terrible fluctuations allow something called price stability and pricing logic to exist?

Another reason for the astronomical deviation of prices is the disruption and injustice in distribution. resources and incomes. Funds have been created for a certain group of people, which can undoubtedly be called rent, private consumption, and wealth accumulation for pampered people.

Remember, the Turkish Central Bank, increased from 8.5% to 45%! Is this not enough to multiply the wealth of the upper class? I saw that 224,000 people lost their jobs very easily, but there is still no decrease in demand for imported products. The import of consumer goods continues at full speed and they are sold with huge profits. Image/1402/11/09/1402110915372576429279414.jpg”/>

The windfall and corrupt wealth or the disruption of income distribution disrupts the balance of prices. It is like that on a street in Turkey, hundreds of people are standing in line to buy stale and cheap 2 lira bread, but two streets away in the same country, hundreds of people are in line to import luxury and expensive cars.

In this case, an equilibrium cannot be established in prices in this country, and the result is this: in our country we have a social structure that cannot walk and is literally crawling on its hands and feet. Is. Therefore, we have a market that evaluates every opportunity from its perspective. In short, the unstable prices on the counters actually reflect our declining moral values, and let’s not forget: “If the fish is dirty, so is the tail.”

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