Turkish Economist: The solution to the current deficit problem is to increase production

TurkPress

Turkish economist Erdal Tans Karagül stressed that the best way to reduce or eliminate the current deficit is to increase production, explaining that high production meets local consumption and enabling the export of some of the surplus products produced.

Karagül said in a report in the newspaper Yeni Safak that the current deficit arises when consumption exceeds the amount of production, and indicates a situation of economic imbalance of production or reduction of the deficit current.

He explained that when considering the causes of the current deficit, it is obvious that the increase in imports over exports – that is, the trade deficit – is a major factor. which contributes to the continuation of this deficit as a permanent phenomenon in the economy.

This is due to a number of factors, particularly the heavy reliance on imports in the areas of energy and basic materials that are not available locally, as well as the heavy reliance on imported defense products, and the low level of technologically advanced products in the industrial sector. , which contributes to the worsening and continuation of the trade deficit. According to a Turkish expert.

The report continued:

In the Turkish economy, it seems clear that the high dependence in the past has included energy and basic materials needed for production, as well as the taxes that have been payments on imports, were factors that played a major role in maintaining the trade deficit.

In recent years, we have seen a significant reduction in the current deficit, thanks to efforts to reduce dependence on imports in the defense sector, increase reliance on renewable energy, take advantage of domestic energy resources, and reduce imports of non-essential or luxury goods.

To ensure the sustainability of this reduction in the current deficit and to reverse this problem, measures should be taken to increase the local production of goods and materials that can be produced locally, as well as reducing imports of products intended for luxury consumption.

The solution to the current deficit lies in production

The best way to reduce or eliminate the current deficit is to stimulate production. High production achieves meeting local consumption, and allows the export of some of the surplus products produced.

Achieving high levels of production means taking full advantage of the available production potential and maintaining the vitality of the economy.

Therefore, it is necessary to eliminate the current deficit in order to achieve sustainable economic growth, avoiding the need to choose between the current deficit and economic growth, and not to ‘ remain below potential levels of economic growth.

Eliminating the current deficit also contributes to achieving greater independence when implementing economic policies.