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Erdogan’s new economic plan no remedy for lost purchasing power

Even as Ankara rolls out a new scheme to contain the country’s currency crisis, the severe losses of millions of low-and middle-income Turks appears irreversible.
OZAN KOSE/AFP via Getty Images
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Turkish President Recep Tayyip Erdogan’s emergency plan to prop up the battered Turkish lira and stop creeping dollarization has reversed the currency’s free fall for now, but the package of new measures offers no remedy to the loss of purchasing power plaguing Turkey’s wage-earners — from unskilled workers to white-collar professionals — amid soaring inflation.

The new plan, announced Dec. 20 shortly after the lira sank to an all-time low, aims to encourage retail lira deposits by offering a state guarantee to pay the differential should the lira’s decline against hard currencies exceed banks’ interest rates.

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