Horioka evaluated the developments in Türkiye and the world economies.
Stating that the main driving forces behind the concerns of economic recession around the world are the Covid-19 epidemic, high inflation, the Russia-Ukraine war and high energy prices, Horioka said that the epidemic caused serious disruptions in economic activities and decreases in gross domestic products.
Pointing out the importance of the measures taken against the epidemic, Horioka said, “The economies are currently recovering thanks to the encouraging policies adopted by various governments in order to reduce the negative impact of the Kovid-19 epidemic.” he said.
Emphasizing that despite this improvement, economies are now facing the risk of high inflation, Horioka said:
“It is difficult to know what is the best policy to address both recession and high inflation issues at the same time. While many countries choose to increase interest rates, this poses the risk of causing a recession or a slowdown in economic growth. Some countries use a low interest rate or quantitative easing policy. I think Turkey is one of the few exceptions trying to implement a low interest policy. Japan is another country that has implemented a similar policy to see which policy regime is more successful in tackling the various problems we face.”
Evaluation of the Turkish Economy Model
Horioka also pointed out that there is a tendency to move away from globalization in the midst of many crises that occur simultaneously and cause disruptions in supply chains and supply shortages.
Stating that the tendency to move away from globalization is a good policy in terms of reducing dependency on other countries and providing more security, Horioka said, “However, it also means that you can no longer benefit from trade. Therefore, it is very difficult to answer which of these is the best approach.” used the phrases.
Horioka also made the following assessment regarding the Turkish Economy Model:
“I think the Turkish Economy Model is a good model for emphasizing issues such as growth and exports in general. One of the features of this program is the low interest rate policy, which is important in terms of encouraging investment and consumption, but inflation is already quite high and this low interest rate policy does not affect inflation. “Therefore, I think it is important to monitor developments, to make sure that inflation is kept under control and that the economy is booming at the same time. It is a very difficult dilemma facing Turkey and other countries.”