Ali Babacan Inflation Warning

DEVA party president Ali Babacan assessed Turkey’s economic situation and high inflation.

“The most important product in the inflationary basket is food,” Babacan said and continued his words as follows;

“When we look at food inflation, what is its basis? There are agricultural costs. In agriculture we say; ‘Support the costs of fertilizers, feed and seeds of our farmers. We say, ‘Pay half of this as a state.’ If we had come, we would have done these things, but now they can do them too. There has been a 20 percent increase in electricity prices and of course the cost will also increase. We say: ‘Give farmers cheaper diesel and electricity.’ Complete these irrigation investments as soon as possible. Stop spending money left and right. Because with irrigation efficiency increases and costs decrease.”

“THEY DESTROYED THE COUNTRY’S ECONOMY”

Emphasizing that the way to reduce food inflation is by supporting farmers, Babacan continued as follows:

*It is necessary to reduce farmers’ costs. They didn’t understand this. When costs rise, our farmers are oppressed and our citizens are forced to buy all kinds of food at expensive prices. ‘Inflation is high, what should we do?

*Let’s increase the interest rate. When the interest rate is increased, demand decreases, and if demand decreases, inflation decreases.’ Increase the Central Bank interest rate as much as you want. How will diesel go down to this price? They increase the price of corn from 5.70 TL to 6 TL.

*The increase is 5 percent. The cost is 100 percent. The fertilizer pattern is the same, the feeding pattern is the same, the seed pattern is the same, the pesticide pattern is the same. With this mentality inflation will not go down, my heart hurts. They destroyed and ruined the country’s economy, it’s a shame.

“INFLATION CANNOT BE REDUCE BY INCREASING INTEREST RATES”

Babacan stated that the increase in food prices is very high: “It is not possible to support the increases in food prices. To reduce food inflation, it is necessary to reduce the cost of production for our farmers. Support for fertilizers, feed, water, diesel, electricity and credit needs to be increased. They don’t understand this. “You can’t reduce inflation simply by raising interest rates,” he said.