TURKEY In 2022 more than 85,000 Turkish small businesses and shops closed

Official data from the Confederation of Turkish Tradesmen and Craftsmen (TESK) confirm the crisis. Last year, some 81,000 companies lowered the blind. The fall began with the Covid pandemic and promises to continue. The increase in inflation, which has reached 85%, is having a strong impact on the economy, with consequences for rental prices (+70%). Erdogan increases the minimum wage to 2023.

Istanbul () – In the first 11 months of the year, the businesses of at least 85,785 artisans and merchants closed their doors. Official figures, published by the Confederation of Turkish Tradesmen and Craftsmen (TESK), confirm the crisis situation that crosses the country. In November alone, 8,951 companies closed. The numbers do not stop growing, as can be seen from the comparison with 2021 -which had already caused more than one alarm, with the closure of 81,159 companies.

Commenting on the data, Bekir Başevirgen, a member of the main opposition party (CHP, Republican), spoke of a “20% increase” in the number of people who have closed their businesses. “The devastation that merchants began to experience with the outbreak of the pandemic [de Covid-19] continues,” he added, and there are no signs that the trend will reverse in the near future.

Among the critical factors that the parliamentarian points out is the very high inflation that small businesses endure. And he warns that since December, merchants have had to face a 70% increase in rental prices, since, unlike what happens with housing, the Government has not put a cap on the rise in rents for establishments that employ staff. Craftsmen and merchants, “he concludes,” do not make enough profit and are forced to use the money collected almost exclusively “for rent payments.”

Meanwhile, President Recep Tayyip Erdogan is trying to quell widespread discontent over economic difficulties and trying to maintain consensus ahead of next year’s presidential elections. That is why it announced a 55% increase in the minimum wage for 2023. The base salary will be set at just over 8,500 liras (about 460 euros), which represents an increase of 55% compared to July and 100% compared to to January 2022.

If the annual data is taken as a base, inflation has risen above 85% in recent months, however in the last period it seems to have eased. Erdogan explains that the decision to update the salary was a government initiative, since unions, employers and companies could not reach an agreement. The latter do not hide their fear of a new increase in labor costs -due to the increase in the minimum wage- which will end up affecting productivity.