After 19 Years of Erdogan Turkey Now Has Breadlines for Government-Baked Bread as Lira Turning Worthless

Editor’s note: Lira is now at 15 to the dollar. Would have been 12 last month, 8 several months ago, 4 four years ago, and 2 in 2013.

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Istanbul Halk Ekmek, or “Public Bread”, sells a 250g (8.8 oz) baguette for 1.25 Turkish liras ($0.09) – cheaper than at nearby bakeries, where prices start at 2.50 liras ($0.18).

Though the difference is measured in pennies, the savings add up for Toprak and many other Istanbulites who queue at more than 1,500 such kiosks across the city each day.

“Everything is getting expensive, from your food to your bread, from your shirt down to the socks you wear,” the 71-year-old Toprak told Al Jazeera.

A former truck driver and produce wholesaler who retired five years ago, he recently moved in with his children because money is tight. “My retirement social security only brings in 800 liras ($56) a month, so that’s not enough these days to live alone on,” Toprak said. “We are four people in the house, and our rent is 2,000 liras ($140 a month). Each of us eats at least one loaf a day, so I plan on buying four loaves from here. You need to save every bit of money you can these days.”

Source: Al Jazeera

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“The reason for the long lines at İstanbul People’s Bread stalls is that the price is half [of what is charged by private bakeries]. This is a demonstration of public impoverishment. Over the past five years our production used stand at a daily average of 800,000 to 900,000 loaves. However, as of November 2020 this has climbed to 1,250,000 loaves,” Nama said.

“Despite our increased capacity, the demand is continually growing and the lines are not getting any shorter.”

Demand has jumped by 50 percent

The capital Ankara is one of the cities where demand for cheap bread is high. From the early morning hours, lines mostly made up of retirees form in front of the stalls. In the Ankara Municipality’s online complaint mailbox, long lines caused by an insufficient supply of bread is one of the most frequent complaints received.

Although municipalities have increased their production capacity, the lines are getting longer, which also became a subject of discussion at the parliament.

Main opposition Republican People’s Party (CHP) deputy Engin Altay addressed ruling Justice and Development Party (AKP) members and said: “Friends, the people are hungry, they are desperate. Yes, their stomachs do get something, they get dry bread,” to which AKP deputy Tin responded, “Then it means that they are not in fact hungry.”

Tin’s remarks prompted widespread outrage on social media as thousands of Facebook and Twitter users posted comments with the title “If the public is able to eat dry bread, it is not hungry.”

Source: Turkish Minute

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Many Turks Can’t Afford Bread, and Bakers Can’t Afford to Make It

A line of glum-faced people wrapped up against the rain stood along the street outside a government bread bank in a suburb of Istanbul.

“People cannot manage,” said Sengul Essen, 57. “I worked 21 years as a cleaner at the university and now I am waiting in a bread queue.”

Turks are grappling with soaring inflation, watching prices rise daily as the lira has plunged against the dollar and their salaries and pensions no longer cover even the staples of life. Bread lines have started to appear in neighborhoods as growing numbers of people are turning to cheap, government-issued bread to fill their tables.

On a cold, wet afternoon this week, the mood in the bread line was bleak. Most people did not want to be interviewed for fear of getting into trouble for criticizing the government of President Recep Tayyip Erdogan, which frequently detains his critics. Those who spoke declined to give their names.

But as a conversation started, the grumbling grew.

“You don’t have to ask how things are, you can see the line of people,” one young woman said.

“Morning and night we see prices increase,” said an older man behind her. Of the government, he said, “they don’t ask us” how people are faring, adding, “but you see us in the queue.”

An electrician stood listening. “People are in pain,” he said. He said he earned 2,900 lira per month (about $207 at current rates), and his rent had just gone up to 2,000 lira. His wife was buying less of everything in her weekly shopping, he said. “I cannot make ends meet.”

Food prices have soared worldwide during the pandemic, driven by supply chain disruptions, higher fuel costs, global shortages of fertilizer and other factors. But the plummeting value of Turkey’s currency, down about 50 percent since February against the euro and dollar, makes the problem especially painful here.

When it comes to bread, a hallowed staple that Turks traditionally eat with every meal, the government has intervened significantly, pressuring bakeries to sell the traditional white loaf at a price lower than it costs to make, hoping to short-circuit the inflation that Mr. Erdogan fears could sow discontent and dim his election chances 18 months from now.

Grocery stores have been forced to stick to a fixed price for selling bread that is set by the Chamber of Bakeries, a trade association, but most bakers said the order came from the central government.

The Istanbul municipality has significantly increased supplies of cheap bread from government factories, and the federal government has announced that it is providing subsidized flour to bakeries.

Yet, in a sign of the depth of the economic crisis, bread sales are down and bakeries, forced to keep prices to the level set by the Chamber of Bakeries, warn that they are facing bankruptcy.

“I cannot turn around the business,” said Ahmet Ucar, 39, whose bakery stood up the hill from the government kiosk. “The price of flour keeps increasing.”

His costs were constantly rising, not just of flour, but of yeast and sesame seeds, electricity and gas. In a final blow, the landlord had also raised the rent, Mr. Ucar said, screwing up his eyes with the strain.

Sales are down, as in most bakeries, by roughly one-third. Customers are buying less, and some are joining the lines at the government kiosk where a loaf costs 1.25 lira, about nine U.S. cents.

Mr. Ucar said he could not access the cheap flour offered by the government because the suppliers did not take credit but demanded cash up front. He dismissed the government announcements as just show.

Some bakeries have ignored the set price of 2.5 lira and raised the price of the staple loaf to four lira, in line with their rising costs.

But Mr. Ucar said he would not take the risk. “We cannot raise the price,” he said. “The municipality will fine us.”

Even amid the pandemic and the currency crisis, Mr. Ucar said, municipal inspectors had fined him for an administrative violation — not having the correct license, although he insisted he did have it.

“They are executing arbitrary fines,” he said. “They are trying to fill the gap in their finances with fines.”

Many people complain that political leaders are busy scoring points over the crisis rather than fixing the problem.

The Istanbul municipality, which is run by Mayor Ekrem Imamoglu, an opponent of Mr. Erdogan and a presidential hopeful, has announced that it is providing milk to disadvantaged schoolchildren and boosting sales of low-cost bread from the municipal factories.

The municipality has raised production to 1.5 million loaves a day, although demand is up to 1.6 million, said Okan Gedik, the general manager of Halk Ekmek, the municipality’s bread company.

“We are crushed from two sides,” Mr. Ucar said. “The municipality is selling cheap bread to gain votes, and the government keeps prices down to keep votes.”

In one bakery, where the owners said they were on the verge of bankruptcy, a fierce argument broke out between the two partners. One blamed Mayor Imamoglu for undercutting the bakery by subsidizing sales. His partner blamed Mr. Erdogan’s government for forcing bakeries to keep prices low.

The partners asked not to be named for fear of trouble from the government. The senior partner said he had taken out a bank loan and was selling family jewelry to tide them over. If conditions did not change he would lose the business in a few months, he said, choking up.

Store owners and bakers with less overhead said they could survive but were eating into their savings.

“Bakeries who do not have large sales will not survive,” said Hasan Topal, 55, who runs a café besides his bakery. “I will go to the end until I eat up all my capital.”

Nilgun Gurgen, 43, who runs a small grocery store with her husband, said their bread sales had been cut nearly in half over the last two months. She was adjusting prices daily and the only item that she was selling more of was cigarettes. Many businesses were headed for disaster. “I don’t think people will be able to survive,” she said.

Mr. Ucar said he had gone 100,000 lira into debt during the pandemic and now, with the currency crash, was struggling with the uncertainty caused by price fluctuations. “You cannot understand what the government is going to do next,” he said.

Ali Babacan, an opposition leader who served as finance minister under Mr. Erdogan, berated the president on Twitter for blaming some of the price rises on shopkeepers stockpiling goods.

“Mr. Erdogan, poor shopkeepers, who do not know what to sell and how much to sell in a country where there is no price stability due to your faulty policies and bad management, you call them hoarders.”

Mr. Ucak said he was already running at a loss and could see the end approaching. “I don’t know if I will be here next year,” he said. “I will try to go abroad.”

Source: The New York Times

Turkey lira crisis: Erdogan increases minimum wage by 50 percent

President hails ‘highest raise in the last 50 years’ as lira slumps following reduction of interest rate from 15 to 14 percent

Turkish President Recep Tayyip Erdogan announced on Thursday that the country’s minimum wage would be increased by around 50 percent next month.

In a televised address from Ankara, Erdogan said the wage would increase to 4,250 liras ($272) per month, up from 2,826 liras ($180).

The announcement came as the Turkish lira hit new lows after the central bank fired the latest salvo in Erdogan’s “economic war of independence” by cutting interest rates for the fourth successive month.

The reduction of the main rate to 14 from 15 percent comes in the face of an annual inflation rate that has surged past 20 percent and is expected to climb even higher over the next few weeks.

The lira was trading down nearly five percent after the central bank’s announcement.

In his address, Erdogan said: “The increase in the minimum wage is 50 percent, and that is the highest raise in the last 50 years.

“I believe that with this increase, we have shown our determination not to allow our employees to be crushed by the price increases. 

“There are some problems right now, and we will overcome these problems as soon as possible.”

More than 40 percent of workers in Turkey currently earn the minimum wage.

Erdogan said the government would also abolish both income and stamp tax on the minimum wage “to ease the burden of employers and remove possible effects on employment”.

Source: Middle East Eye