Turkey’s small businesses’ skyrocketing bankruptcy year: 2022
A total of 125, 892 small and medium-sized enterprises in Turkey went bankrupt in 2022, amid country’s troubling economy.
Veli Agbaba, the deputy chairman of Turkey's main opposition Republican People's Party (CHP) said the number of bankrupted businesses were the highest of the last five years, citing the Confederation of Turkish Tradesmen and Craftsmen (TESK) data.
“Mass bankruptcies were inevitable due to country’s high inflation figures and the rising of the input costs caused by the weak lira,” he said, Birgun newspaper reported on Friday.
While the total number of the bankruptcies between 2018 and 2022 have increased to 548,374, Turkey’s largest city Istanbul topped the list with 13,160 businesses in 2022, Agbaba said.
Turkey's inflation has surged to record highs over the past year after the central bank adopted a rate-cutting policy despite increasing prices. Acting on the orders of President Erdogan who insists on low interest rates, the central bank has lowered the benchmark one-week repo rate from 19 percent to 9 percent since autumn 2021. In October, Turkey’s inflation rate accelerated to 85.5 percent, extending to a 24-year high. Following the rate cuts in the country, Turkish lira lost around 44 percent of its value in 2021, and a quarter more in the first half of last year.