History of Financial and Economic Stress In Turkey - Paper Example

The Turkish Economy has for a long time experienced both the financial and environmental stress. These two conditions have significantly affected the nations financial and environmental sustainability. Looking at the financial stress, it is worth to note that Turkey depended heavily on the foreign investments for its economic growth (Aklan, Cinar, and Akay, 2015). As part of this stress, the Turkish government and baking systems lacked the financial means to support reasonable economic growth. In fact, the nation was already experiencing colossal budget deficit. However, it managed to sustain this situation through the sale of the enormous quantities of high-interest bonds to the locally established banks. Various studies have shown that the political state of the nation at that particular time significantly contributed to the stress and ultimately crisis. It entailed the fighting between Yilmaz and Cillar on one side and Erbakan on the other (Macovei, 2009). The environmental sustainability forms an integral part of the global and social well-being. Like any other developed economies, Turkeys vulnerable ecosystem has been subjected to increasing stress by the high population growth, enormous energy consumption, and rising incomes (Kaygusuz, 2009). The synergic effects of both the financial and environmental stresses have therefore created the enormous economic crisis.

Current state of the Problem

Both the financial and environmental stresses have dominated the Turkish economy in addition to negatively impacting it (Commoner, 2014). Various efforts and initiatives were implemented to reduce the effects on the public well-being. The government has responded by selling many of its state-owned companies with an objective of balancing the budget. The year 2000 was welcomed and later dominated by huge unemployment, lack of medicine in healthcare facilities and political instability (Onis, 2009.) While it is evident that the various efforts have been applied in line with the mission to revert the condition to normal as before, another financial stress was observed between 2008 and 2010. The stabilization efforts have in the recent times have generated meaningful impacts. The IMF loan is currently viewed as reasonable if not sufficient. With the aim of promoting both the financial and economic stability, Turkish governmental bodies through the assistance of UNDP has attempted to improve environmental sustainability, biodiversity management, and ecosystem services. The government has further facilitated the market transformation through clean technology and creation of employment opportunities. In fact, the strengthening economic competitiveness with a territorial technique has enhanced capacities for disaster preparedness and early warning (Ozturk and Acaravci, 2016).

Future Consequences

The discussed the current stabilization of both the financial and environmental stress in Turkey had demonstrated considerable effectiveness in enhancing stability (Terrones et al. 2009. However, continued financial stress and crisis in Turkey are likely to cause enormous negative effects such as cutbacks in businesses, trade, government expenditure and unemployment. The depressed output path tends to result from the long-lasting reductions of the equal proportions within the employment rate. The loss of output within the labor market is also accounted for by the total factor productivity losses. Regarding the future consequences, environmental stress experienced in most parts of Turkey will lead to severe problems if not dealt with appropriately or mitigated. Fundamentally, the ecological stress has profound impacts on the biodiversity. According to Ozturk and Acaravci (2010), the environmental stressors exist within continua of the intensity of environmental factors, which interact with one another and their detrimental effects on organisms manifest only at considerably high or low exposure strengths. The climatic stress, which is associated with the extensive interaction that takes place among the organisms of the same or different species is likely to increase if proper actions are not executed. As observed currently, if more permanent adjustments which occur in response to the long-term environmental stress intensity are not implemented, effects will increase.

References List

Aklan, N.A., Cinar, M. and Akay, H.K., 2015. Financial Stress and Economic Activity Relationship In Turkey: Post-2002 Period/Turkiye'de Finansal Stres ve Ekonomik Aktivite Iliskisi: 2002 Sonrasi Donem. Yonetim ve Ekonomi, 22(2), p.567.

Commoner, B., 2011. Rapid population growth and environmental stress. International Journal of Health Services, 21(2), pp.199-227.

Kaygusuz, K., 2009. Energy and environmental issues relating to greenhouse gas emissions for sustainable development in Turkey. Renewable and Sustainable Energy Reviews, 13(1), pp.253-270.

Macovei, M., 2009. Growth and economic crises in Turkey: leaving behind a turbulent past? (No. 386). Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.

Onis, Z., 2009. Beyond the 2001 financial crisis: The political economy of the new phase of neo-liberal restructuring in Turkey. Review of International Political Economy, 16(3), pp.409-432.

Ozturk, I. and Acaravci, A., 2010. CO 2 emissions, energy consumption and economic growth in Turkey. Renewable and Sustainable Energy Reviews, 14(9), pp.3220-3225.

Ozturk, I. and Acaravci, A., 2016. The long-run and causal analysis of energy, growth, openness and financial development on carbon emissions in Turkey. Energy Economics, 36, pp.262-267.

Terrones, Marco E., Alasdair Scott, and Prakash Kannan, 2009, From Recession to Recovery: How Soon and How Strong? World Economic Outlook, April (Washington: International Monetary Fund).

Verick, S., 2009. Who is hit hardest during a financial crisis? The vulnerability of young men and women to unemployment in an economic downturn.