Turkey’s inflation crisis continues to escalate one year after the start of economic recovery

In Istanbul, the struggle against inflation is palpable as residents line up at a subsidised eatery, the kent lokantası, for affordable meals amidst soaring prices. The city’s 14 kent lokantası serve around 1,000 meals daily at a fixed price of TL40, with the municipality subsidising two-thirds of the cost.

For many like Hasan, a 53-year-old deliveryman, and Hüseyin, a 67-year-old retiree, the kent lokantası is a lifeline in the face of rising food prices and stagnant incomes. Istanbul’s decision to open more outlets highlights the ongoing struggle to combat inflation, despite government efforts to overhaul the economy.

President Recep Tayyip Erdoğan’s economic reforms, including a significant increase in interest rates and reduced public spending, have drawn praise from investors but have yet to alleviate the burden on ordinary citizens. With inflation nearing 70 per cent and borrowing costs skyrocketing, many are feeling the pinch of the government’s austerity measures.

While international fund managers show renewed confidence in Turkey’s economy, the reality on the ground tells a different story. Grocery prices continue to climb, pushing families into a cycle of poverty as basic necessities become increasingly out of reach.

As the government grapples with high inflation and public discontent, the central bank’s efforts to curb price growth face skepticism from consumers who have seen past targets missed. The road to economic stability remains uncertain, with the success of the current measures hinging on the patience and resilience of both policymakers and the Turkish people.