A misguided feeling of optimism over economy rising among Turks

The BIST100, the Istanbul stock exchange, has risen steadily in third week of May. Since the beginning of the month, the index has increased by 4 percent. Likewise, for the past two weeks, the value of the Turkish Lira has appreciated steadily against the dollar. As of May 21, the Turkish Lira to USD exchange rate was 6.79. That is close to its value in the beginning of April. Such positive developments have undoubtedly affected public opinion with regards to the future of the Turkish economy.

In fact, our latest surveys demonstrate that 42 percent of Turkish people believe the economy will be stronger next year. This figure is the highest we’ve seen since we began measuring public opinion regarding the future of the Turkish economy in November 2019. It is noteworthy that consumer confidence is increasing. What is more, results from our very latest survey show that an important share of the population is experiencing difficulties paying their utility and credit card bills. One might assume that this would lead people to expect the economic situation to worsen. Yet the results of our survey suggest otherwise. It seems like there is an understanding that the economy has hit rock bottom and can only improve as we move forward. 

Natural gas bills became a sudden source of debate as people complained that their bills were unusually high. Accordingly, in the survey we conducted at TurkiyeRaporu.com during the third week of May, we asked our participants the following question: “Which of the following payments did you have difficulties with in the last two months?” We provided them with several options to choose from. According to our results, while 28 percent of participants had difficulties paying their natural gas bills, 35 percent struggled to pay their electricity bills. Finally, if 34 percent of participants stated that they struggled with paying their rent, 22 percent of them said they had no difficulties paying their bills or rent. A quick cross analysis shows that more than 30 percent of those participants who had difficulties paying their bills or rent still believe that the economic situation will improve next year. This corroborates our point that some outcomes do not affect public opinion as we expect them to. 

A similar trend applies to our participants’ credit card payments. In our latest survey, we asked our participants “Which of the following would you agree with regarding your credit card payments in the last two months?” using in a multiple-choice question. Overall results show that 35 percent of participants did not have a credit card. While 21.7 percent of participants could not pay the minimum amount of their credit card bill, only 14 percent of them were able to pay the total amount of their credit card bill. Finally, 30 percent of participants stated that they were only able to pay the minimum amount of their credit card bills. A quick cross-examination of the results shows parallels with our previous question. Amongst the participants who stated that they were only able to pay the minimum amount of their credit card bills, 42 percent of them believed that the economic situation would improve next year. An even more striking result is that amongst those who couldn’t even pay the minimum amount of their credit card bills, 58 percent believed that the economic situation would improve next year.

In short, it seems like there is a rising feeling of optimism rooted in the belief that things cannot get worse. Unfortunately, such a feeling is misguided. The overall situation is doomed to get worse. We are to witness societal disruptions which will take years to reverse. This has nothing to do with politics. Officials in leading positions should know it.