Delivering a speech in Parliament on Friday during the last session of budget talks, Canikli said between 1990 and 2002 the funds allocated for interest payments was constantly on the rise, increasing from 20 percent of the total budget in 1990 to 44.7 percent in 2002. He explained that as of 2003, the share of interest payments in the budget started to fall, totaling 41 percent in 2003, 37 percent in 2004, 28 percent in 2005, 28 percent in 2006, 23.9 percent in 2007, 22.2 percent in 2008 and 20.8 percent in 2009. With this decline, the government saved TL 232 billion in seven years, Canikli noted, stating that the main financial source of government projects such as highway building, high-speed train rails, schoolbooks given to students free of charge and many others comes from these funds.In the past, interest payments used to increase during economic crises, Canikli remarked, noting that during the 1994 economic crisis the share of interest payments in the budget climbed from 23 percent to 33 percent, increasing by TL 28 billion. In November 2000, this figure was up from 38 percent to 43 percent; however, he added, during the latest economic recession, it was down from 22 percent to 20 percent.
Canikli said TL 81.9 billion will be allocated to support for the poor through free coal, agricultural subsidies and educational programs in the coming year, which accounts for 28.6 percent of the 2010 budget. Currently the central bank has $76 billion in foreign currency reserves, he noted. Since the AK Party government came to power, the poverty rate has declined from 26.96 percent in 2002 to the current level of 17.11 percent, with the number of poor decreasing by 6.8 million, he said.
The government took several measures to support the real sector in the face of the crisis, Canikli noted, adding that the financial cost of five stimulus packages introduced by the government has been more than TL 40 billion so far. “However, the situation that puts us in trouble is not these packages but the drop in exports, which fell from $130 billion to $100 billion. Our exports to EU countries in particular suffered a decline since demand for Turkish commodities fell as the purchasing power of the citizens of these countries decreased. There is nothing the Turkish government can do to cure this situation in the short term. The only logical thing was to shift exports to closed economies such as Asian and African countries, which suffered less from the crisis. And this is what the government is doing. Thus, exports started to rise.”
Mehmet Şandır, the deputy chairman of the Nationalist Movement Party (MHP) parliamentary group, accused the government of not being able to foresee the near future, stating that 2009 ended with a 6.5 percent contraction and a TL 70 billion budget deficit, surpassing the 2009 budget expectations of a TL 10 billion budget deficit and failing to reach the targeted 4 percent growth.
