Turkish President Recep Tayyip Erdogan/Bloombergby Bloomberg
Turkish President Recep Tayyip Erdogan unveiled a TRL 100 billion ($15.4 billion) plan to help businesses ride out the economic storm caused by the coronavirus pandemic.
The government will introduce a set of new measures such as tax cuts and payment deferrals for businesses, and an increase in minimum pension payouts.
Turkey is following countries around the world in pledging stimulus packages in coordination with central banks as the global economy grinds to a halt. Infections in Turkey are increasing, a growing threat to tourism and manufacturing industries just as growth was beginning to take off after a downturn.
The government said that sectors such as retail and transportation will receive a six-month deferral on some tax and insurance premium payments.
President Erdogan vowed to provide the necessary support to Turkish Airlines and the government will also reduce value-added tax on domestic air travel from 18 to one per cent.
Furthermore, the Credit Guarantee Fund limit will be doubled to TRL 50 billion and minimum payouts for pensioners will be increased to TRL 1,500 a month—the government will make an early annual bonus payment to pensioners.
The president said that exporters will receive stock financing support to maintain capacity utilisation ratios, while accommodation tax will be lifted until November 2020. The government will also allocate an additional TRL 2 billion for cash support to families in need, said Erdogan.
The Turkish central also lowered its benchmark interest rate by a full percentage point, pushing official borrowing costs adjusted for inflation near the world’s lowest.
Earlier on the Turkish president warned of serious economic consequences as the virus has virtually brought daily life to a standstill.