With a risk of mass unemployment, a collapse in tourism, and an unstable currency,"the situation is extremely bad," said Atilla Yesilada, an economist at GlobalSource Partners think tank.
One of the main reasons for Erdogan and the ruling AKP party's continued electoral success was the economic boom that followed the 2001 financial crisis. This dismal situation led to defeat in local elections last year, when Erdogan's ruling AKP party lost both Istanbul and Ankara. The government hoped for 5% growth in 2020, but the IMF predicts GDP will instead contract by 5% and unemployment will rise to 17.2% this year.
Its declining value is especially alarming because Turkey's private sector has contracted a substantial amount of debt in foreign currencies.To spur business activity, Erdogan opted for targeted measures against COVID-19, such as lockdowns only on weekends or public holidays.