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18 May 2022

Aubergines off the menu in Turkey as inflation bites

Controversial economic policies are causing prices to soar and consumers to cut back on groceries.

By Ayla Jean Yackley

ISTANBUL – Didem Çolakaoğlu Hoşgör stopped serving octopus and calamari, and slashed the number of aubergine specialities at Sofyali, the meyhane restaurant she runs in central Istanbul, to cope with the rising food prices that are squeezing her already lean margins.

Aubergines, derided as the “price-hike champion” by newspapers earlier this year, and other basic foods are contributing to a rise in annual inflation in Turkey, which reached 70 per cent in April. Meyhanes, traditional tavernas that serve meze and fish alongside the national spirit of raki, dropped roasted aubergine salad and shakshuka from their menus. Street markets stopped stocking the bulbous, purple fruit, and households are going without a mainstay of Turkish cooking.

“Customers always ask, ‘What do you have with aubergine?’ It’s a beloved food,” said Hoşgör, 46, who has to check grocery stores and street markets when her suppliers stop selling key items due to prohibitive prices. “We make a loss on many dishes because the cost of ingredients is in such flux. But I am not going to take Tipp-Ex to the menu to change prices every day. People need stability.”

Inflation is roiling economies around the world as Russia’s war in Ukraine knocks out trade links and fuels commodity prices, forcing central banks to hike interest rates to slow inflation. But in Turkey the domineering president, Recep Tayyip Erdoğan, has barred policymakers from raising rates in order to keep credit flowing and the economy growing before an election next year.

That has sparked a steep fall in the lira currency, which has lost about half of its value against the dollar since last year, driving up the cost of imports. Pharmacists complain that supplies of medicine are running low, and queues have formed at petrol stations on the eve of fuel price hikes.

But Turks feel the economic pain most acutely while food shopping, including at bread lines that have popped up at government-subsidised kiosks. Turkish farmers depend on fuel, fertiliser and other foreign inputs to raise their crops. At hothouses along the Mediterranean coast where aubergines are raised, production costs jumped 138 per cent for each quarter acre of land since last year, according to the local commodity exchange.

Farmers pass on some of the soaring costs to supermarkets, and retail food prices in April rose almost 90 per cent. The government said the fastest-rising nine items were all food, including onions, lettuce and tomatoes.

Unhappiness with the cost of living is damaging Erdoğan’s political fortunes. Nine out of ten people say their biggest problem is economic, a poll by Ipsos showed. The ruling party is still Turkey’s biggest, but its support has slumped to its lowest levels since it swept to power in 2002. Two-thirds of voters have lost faith that Erdoğan can fix the economy, research firm MetroPoll found in May.

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For most of Erdoğan’s tenure, Turkey enjoyed a boom that lifted millions of people out of poverty, and the pious poor are the bedrock of his support. But the economy has faltered since 2018, coinciding with Erdoğan’s consolidation of authority after he won vast new constitutional powers. He has dismissed dozens of economic officials, including statisticians who track inflation and three successive central bank governors who failed to cut interest rates fast enough.

[See also: Five ways the government failed to shield the UK from inflation]

A devout Muslim, Erdoğan calls himself an “enemy of interest” and has cited Islam’s proscription of usury as a guiding principle. He adheres to an unorthodox theory that high interest causes inflation, while economists believe setting rates is a central bank’s best tool to stabilise prices. “Erdoğan has been trying to rewrite economics to say the opposite, which is the economics equivalent of calling the Earth flat,” Timothy Ash, a financial strategist and associate fellow at the Chatham House think tank, wrote in a note following the latest inflation figures.

Among Erdoğan’s more temporal concerns is giving Turkey’s economy a shot in the arm before the 2023 election. He argues that devaluing the lira will encourage consumption, boost exports and ease unemployment, which has been stuck in the double digits for most of the past decade.

His “economic experiment to lower interest rates in the face of inflation is part of his… fundamental faith in a high-growth scenario,” said Can Selçuki, an economist and the director of the Türkiye Raporu polling firm. “But inflation at this level means wages can’t keep up, especially those of the poor who spend more of their income on food and shelter. It is becoming harder for him to retain their support as they struggle to pay their heating bill.”

Erdoğan has cast the currency’s collapse as a siege by shadowy foreign forces, promising victory “in this economic war of independence”. A lawmaker from his party called on the public to mobilise for the battle by eating less. Many are heeding his advice: a survey from Türkiye Raporu survey earlier this year found that 62 per cent of respondents were cutting back on groceries.

At Sofyali, tables still fill up at the weekend, when waiters deftly navigate the raucous dining room with enormous trays decked with small plates. Customers now skip the main course and split small bottles of the aniseed-flavoured raki – the tax on which was raised by 47 per cent earlier this year.

In the dozen years she has run Sofyali, Hoşgör has weathered downturns caused by street protests and bomb attacks that frightened off locals and tourists. In 2020 the coronavirus pandemic forced her business to close for three months. But customers do not stay away for long.

“People will always come to meyhanes. This isn’t just about eating and drinking. It’s being together and forgetting our problems for one evening,” Hoşgör said.

[See also: What does inflation mean for the UK’s cost of living crisis]

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