Under the leadership of Prime Minister Recep Tayyip Erdogan, Turkey has been rapidly progressing in a positive way. In an intricate position at the crossroads of Europe and Asia, the nation has been increasingly involved in working with its neighbors in multiple, often violent, struggles. According to a New York Times article, the country has been working better with the United States and pursuing its full membership in the European Union, its largest economic partner. However, the nation has seen significant internal problems with public demonstrations of its own civil unrest since May 2013. The fractured leadership and power struggle between the Prime Minister and President Recep Tayyip Erdoğan has also made it difficult for the nation to address some of its own challenges, according to an article in Today’s Zaman. Turkey’s biggest challenge in 2015, however, remains its economy.
While Turkey’s economy has been expanding, an article in the Hurriyet Daily News, noted a “trio of economic challenges.” The first was a drop in purchasing manager’s index (PMI) that fell below the necessary threshold of 50, which “signal[s] an overall deterioration in business conditions at Turkish manufacturers.” The article also noted that inflation for the month of August had come in higher than expected. Now, I am not an economist, but I know inflation is not a good thing. The unexpected increase in inflation shows the effect the weakening lira is having on prices. While there is still a significant pricing power as one can discern from he August retail confidence index, the article warns that it is only a matter of time before the increased input prices have an effect on output prices, and thus the prices consumers have to pay for their goods.
The article in Today’s Zaman also noted many other economic problems facing Turkey today, including a $76 billion deficit. Unemployment is still high, and the nation’s exports have been decreasing while imports have risen. “Turkey, which was listed as having the world’s 17th-largest economy in 2013, fell two places to 19th this year, according to the Centre for Economics and Business Research (CEBR) World Economic League Table (WELT)” (Today’s Zaman). As long as Erdoğan continues to conflict with the rest of the government, the economy will continue to be abused in the political battle.
Turkey still has many problems facing its hope for prosperity today. But the most important challenge comes financially. Once the nation is able to fully take control of the full potential of its economy, Turkey will emerge as an even more powerful player in the global field.