Turkish President Recep Tayyip Erdoğan, along with his son-in-law and Treasury and Finance Minister Berat Albayrak, maintain the stimulus package announced in March to support the economy and cushion the fallout from the coronavirus pandemic is among the best in the world.
On March 18, Turkey unveiled a relief package, dubbed the Economic Stability Shield, worth 100 billion Turkish liras ($15.4 billion), which included debt payment delays and tax cuts across various sectors to limit the economic fallout from coronavirus.
These measures entailed certain regulations, including sanctions and penalties, that also forced private banks to increase lending. Ankara attempted to prop up the economy by postponing payments to the Social Security Institution (SGK), and extending the time frame for facing legal recourse for outstanding loan debt to banks.
In truth, Turkey was caught off guard by the pandemic, because the country’s budget had already been wiped out. As such, it was unable to provide money to anyone with the exception of 1,000 liras ($145) cash aid to 2 million families in need. Despite the fact that some 5.5. million workers in Turkey left unemployed by the pandemic were given a three-month allowance well below minimum wage, the Unemployment Insurance Fund coffers were quickly depleted.
There was an expectation that Erdoğan would extend the three-month allowance, but the government opted for only one month, despite freshly granted authority to the Turkish president for a such a move in an omnibus bill approved in April.
While it is apparent that Turkish citizens have not gotten the help they needed from their government, the situation is even worse for residents of the country’s traditionally neglected and underdeveloped Kurdish majority east and southeastern regions, where a large majority of workers and employers have failed to receive any stipends, tax exemptions or postponement on outstanding debt.
Earlier this month, Erdoğan said that through his government’s aid programme, a total of 24 billion lira had found its way into the pockets of Turkey’s population and that the state was supporting the dynamism of Turkey’s entrepreneurs and businesses.
A new field study conducted by the Diyarbakır Chamber of Commerce and Industry (DTSO) shows that the region certainly is not receiving much of that support.
The survey conducted with 107 businesses between May 11 and May 22 revealed that 78.2 percent of businesses in the region had been negatively affected by the pandemic. The poll found that many businesses either decreased their production capacity by half or shut down entirely, the latter a route taken by 53.7 percent of those surveyed.
Only 7.3 percent of businesses were able to continue production with no changes and 69 percent of them have been unable to pay rent for their facilities for months, the DTSO survey said.
The poll also found that a majority of workplaces around Diyarbakır failed to receive support for short-term employment allowance, debt postponement and special loans from banks, with most applications being either not receiving a response or being denied.
The survey showed that, of the 2,696 of a total of 5,604 workers employed in 107 workplaces who applied for short-term employment allowance, only 13,37 received the three-month payment.
Most employers, 75.9 percent, were denied aid due to their inability to fulfil the requirement of having paid 450 days of premiums for their employees, the study said.
Turkey’s Kurdish-majority provinces have the highest unemployment rate at up to 30.9 percent, according to the Turkish Statistical Institute.
“This situation has worsened Diyarbakır’s unemployment problem. A total of 60.9 percent of workplaces were unable to pay their rent, bills, taxes, social insurance premiums, salaries, bank loans and debt,’’ the DTSO found in its study.
“The region that already had difficulty in attaining finances prior to the pandemic, has been faced with even greater financial problems,’’ it said.