Catastrophic earthquakes further worsen Turkey's economic woes

Ankara, Feb 9 (IANS) Twin strong earthquakes that struck Turkey's southern provinces on Monday are likely to leave a significant and long-lasting impact on the country's ailing economy, experts said.

The death toll in Turkey stands at 16,170 so far, while more than 64,000 have been injured, Turkish President Recep Tayyip Erdogan announced on Thursday in Osmaniye, one of the provinces hit by the powerful tremors, Xinhua news agency reported.

He said that a total of 6,444 buildings have collapsed.

According to the Turkish Statistical Institute, the earthquake-hit zone is home to 13.42 million people and generates one-tenth of Turkey's national income.

The earthquakes could cause more than $1 billion in economic losses in Turkey and Syria, according to the US Geological Survey.

Baki Demirel, associate professor of economics at Yalova University, also said losses will likely be in the range of "billions of dollars."

"This is an enormous disaster, most earthquake-hit towns have turned into ghost cities. This is first a human tragedy, but the human loss will inevitably generate a financial loss," the economist told Xinhua.

Demirel pointed out that the disaster will add to government expenditure as thousands of buildings have been leveled and need to be reconstructed.

Turks have been battling for several years with rampant inflation and currency turmoil that have hit households hard. A natural disaster of such magnitude further adds to their country's woes.

The expert suggested an earthquake tax on the wealthier segments of society to finance housing projects, leaving the low and mid-incomed exempted from such a scheme.

According to the United Nations Office of Disaster Risk Reduction, the 1999 earthquake in northwestern Turkey, which claimed over 17,000 lives and left more than 250,000 homeless, caused an estimated $23 billion in economic losses.

Ovgun Ahmet Ercan, a well-known seismologist, made a darker prediction.

"The cost of the earthquake to Turkey is between $35 and $50 billion. While Turkey's domestic and foreign trade deficit is 110 billion (US dollars), this earthquake is a complete disaster," he said on Twitter Tuesday.

The country's current account deficit widened due to an increase in energy imports and rising consumer price inflation, which hit a 24-year high of 85.5 per cent in October last year.

The Organisation for Economic Cooperation and Development (OECD) expects inflation in Turkey to remain elevated at 44.6 per cent in 2023.