Levent Gürses
By the end of 2025, the proportion of wage earners in Turkey earning just 5 per cent above or below the minimum wage had reached 49.6 per cent of the total workforce. In other words, this proportion equates to 8.8 million out of 16.1 million wage earners… Of these, 3.6 million are earning significantly below the minimum wage.
Furthermore, nearly 70 per cent of the 17.7 million pensioners receive a monthly pension below the minimum wage.
By a rough calculation, out of a total of 41 million workers, civil servants (23 million) and pensioners (18 million), 21 million are receiving wages, salaries or monthly pensions at or just above the minimum wage.
As is well known, the net minimum wage is 28,075 TL. Last week, Türk-İş updated its poverty line figure, raising it to 34,586 TL. This means the minimum wage has fallen 6,511 TL below the poverty line… The poverty line, which represents the total income a household needs to survive, has risen to 112,660 TL.
A snapshot of poverty…
We are capturing the picture of poverty through figures.
It doesn’t end there; we continue: Turkey ranks first in Europe for income inequality, third from the bottom among the 38 OECD member countries—behind Costa Rica and Mexico—and is the 28th country with the highest inequality out of 130 nations worldwide…
The income of the richest 20 percent is 7.5 times, and according to some studies, 9 times that of the poorest 20 percent. Whilst the richest 20 per cent take 48 per cent of total income, the poorest 20 percent can only claim a 6.4 per cent share.
Unemployment has reached a historic high
We know all this; for those saying ‘tell us something new’, it was announced again last week.
Unemployment has reached a new historic high.
According to data released by the Turkish Statistical Institute (TurkStat), the labour force participation rate—defined as the proportion of the labour force outside the labour market or in an inactive state—reached a historic high in March, rising by 1.6 percentage points to 31.5 per cent.
The narrowly defined unemployment rate, which covers only those who have looked for work in the last four weeks, fell by 0.3 percentage points to 8.1 per cent.
There are also 6.5 million young people aged 18–24 —referred to as ‘home-bound youths’— who are neither in education, on work placements nor in employment. One in four young people is outside the system, and in this regard, we rank first in Europe and the OECD.
‘The Zeitgeist of Istanbul’
In his splendid article titled ‘The Zeitgeist of Istanbul: Grand Buffet’ on the T24 website, our nephew, the academic and novelist Mahmut Şenol, emphasises that at no point in Istanbul’s history has there been such an abundance of restaurants, cafés, bars, bistros, brasseries, patisseries, buffets and, finally, meyhanes all in one place, stating the following:
‘The phenomenon known in social psychology as “the consumption of joy” suggests the following: Faced with uncontrollable, vast realities, people turn to small spaces they can control and where they can assert their existence.’
“Dancing on the edge of the abyss…”
He also interprets the paradoxical situation where, amidst uncontrollable high inflation and political turmoil following the First World War, Germany was overflowing with cabarets, taverns and restaurants as follows: “The cultural historian Peter Gay describes this as ‘dancing on the edge of the abyss’. This is, in fact, a collective mechanism of denial in the face of a painful existence. Going out is fuelled by the need to believe that life goes on.”
He also explains the proliferation of cafés and restaurants during Japan’s 1990s economic downturn, which followed the post-1980 ‘economic boom’, using the term ‘accessible luxury’. Making the most of the little one has to live well today…
And in summary, he says:
‘A massive buffet has been set up, serving as a space of accessible luxury on the streets of Istanbul. A false abundance reigns supreme. Those who can barely scrape together the fare for a minibus experience the luxury of drinking coffee in Kadıköy for as little as 150 TL.’
Let’s take a look at last week’s key developments:
Women are rapidly withdrawing from the workforce
TÜİK has released the March unemployment figures. We mentioned this earlier. Another aspect is female unemployment… The narrowly defined unemployment rate was estimated at 6.8 per cent for men and 10.7 per cent for women. The employment rate rose by 0.3 percentage points to 48.5 per cent, with the rate standing at 66.0 per cent for men and 31.5 per cent for women. The labour force participation rate increased by 0.1 percentage points to 52.8 per cent, with men at 70.8 per cent and women at 35.3 per cent.
Over 1 million jobs lost
The Turkish Economic Policies Research Foundation (TEPAV) has published its January 2026 Employment Monitoring Bulletin. According to the bulletin, total employment fell by 1,057,000 people over the last six-month period. The clothing manufacturing sector saw the highest employment loss, with 83,176 people.
While the number of employees rose by 1.6 per cent year-on-year in January 2026, employment fell by the same percentage month-on-month, dropping to 25,451,620.
Oil prices soar: Hit a four-year high
Oil prices have surged sharply amid rising geopolitical risks in the Middle East. On Wednesday evening and Thursday, the price of a barrel of Brent crude rose above $120, briefly reaching $126. This level is the highest since the start of the war in Ukraine in 2022… Diminishing hopes for a US-Iran peace deal and expectations that the Strait of Hormuz will not reopen in the near future have driven prices higher.
US President Donald Trump reiterated that the US would maintain the naval blockade on Iranian ports to intensify economic pressure. Iran’s Supreme Leader, Ayatollah Ali Khamenei, also dampened hopes of a deal by stating that his country would not relinquish its nuclear or missile capabilities and would maintain Tehran’s control over the strait. Reports that the US was evaluating military options against Iran further strained the already fragile supply balance.
On Friday, however, prices began to fall from their peak; whilst Brent crude traded above $110 per barrel, it fluctuated within the $105–$115 range.
Meanwhile, analysts warned that as the latest shipments leaving the Persian Gulf reached their destinations, many countries could soon face a serious oil shortage. US crude oil exports hit record levels last week, and global buyers are increasingly turning to American producers to offset supply disruptions in the Middle East.
The United Arab Emirates is leaving OPEC
The United Arab Emirates has announced that it will withdraw from the Organisation of the Petroleum Exporting Countries (OPEC) and OPEC+ membership as of 1 May. This decision, which is expected to weaken OPEC’s market dominance, is forecast to reduce the organisation’s influence on the oil market by altering not only production capacity but also internal group balances. According to experts, this decision could mark the beginning of the end for OPEC. It is anticipated that this decision will weaken OPEC’s influence on the oil market by altering not only production capacity but also internal group balances.
Furthermore, it is expected that the United Arab Emirates’ increase in production following its withdrawal from OPEC will occur more gradually in the medium term rather than balancing short-term global supply constraints.
Storage issues and production uncertainty
The American investment bank Goldman Sachs estimates that exports via the Strait of Hormuz have fallen to just 4 per cent of normal levels. The deadlock in US-Iran negotiations and the ongoing US blockade are further tightening supply. According to the bank’s analysts, Iran’s restricted exports and limited storage capacity could deepen supply disruptions should the embargo continue.
Gold has fallen again, hitting $4,509
Rising geopolitical tensions in global markets and shifts in interest rate expectations have once again put pressure on gold prices.
The price of gold per ounce fell to $4,509 on Wednesday, 29 April. Earlier in the week, it had risen as high as $4,730. On the morning of Friday, 1 May, it was trading at $4,626.
The price of gold per ounce had risen to $4,890 on 17 April, when hopes for a ceasefire and peace were rising.
Last week’s decline in gold prices was driven by factors such as rising energy costs fuelling inflation concerns and growing expectations that major central banks might raise interest rates.
The Fed announced its expected interest rate decision
The US Federal Reserve (Fed) stated that, in line with expectations, the policy interest rate would be maintained within the 3.5–3.75 per cent range.
The statement noted that the decision to keep the interest rate unchanged was passed by a vote of 8 to 4.
US economy enters 2026 with 2 per cent growth
The US economy grew by 2 per cent in the first quarter of 2026, despite the war in Iran beginning to affect energy prices. This figure fell short of expectations of 2.3 per cent. It was noted that the impact of the government shutdown on the economy has persisted since previous months.
Turkish Airlines’ first-quarter profit: 9 billion 915 million lira
Turkish Airlines (THY) announced a profit of 9 billion 915 million lira for the first quarter of 2026. According to a statement made to KAP, the company increased its sales by 46 per cent compared to the same period last year, reaching 257.961 billion lira. Gross profit rose by 84 per cent to 21.568 billion lira, whilst EBITDA grew by 109 per cent to 21.261 billion lira. Net profit for the period stood at 9.915 billion lira (Q1 2025: a loss of 1.818 billion lira). On the balance sheet, total assets rose to 2.158 billion lira (an 8 per cent increase), whilst equity increased to 966.388 billion lira (a 6 per cent increase).
Cevdet Yılmaz announced: Tax cut for the wealthy
Vice President Cevdet Yılmaz announced in a statement to Parliament that Corporation Tax would be reduced.
Yılmaz said, “We are reducing Corporation Tax to 9 per cent for manufacturers and exporters. This is a very significant step. It is a programme that will both support our industrialists and exporters, and make the country particularly attractive for investment, especially in the manufacturing sector. I believe it will bring great benefits to Turkey,” he said
Another privilege for large companies; Corporate Tax is falling
New tax regulations and an incentive package aimed at attracting capital to the economy have been announced.
Under the new tax cuts and incentives, the corporate tax rate for exporters will be reduced, and tax advantages for the finance and transit trade sectors will be expanded. Preparations are also underway for a new Asset Amnesty scheme.
According to the details of the package, the corporate tax rate, currently applied at 20 per cent, will be reduced to 9 per cent for manufacturing exporters and to 14 per cent for general exporters. Under the current scheme, this rate stands at 20 per cent on a reduced basis. Companies relocating to the Istanbul Financial Centre (İFM) will be granted a 20-year tax exemption, whilst the tax rate for transit trade will be reduced to zero.
A new Asset Amnesty regulation is being prepared to allow funds, gold and securities held abroad to be repatriated to Turkey within a specified period at a tax rate of 2–3 per cent.
‘Peace’ has been made with black money seven times
Between 2008 and 2022, the Asset Amnesty scheme was implemented seven times, and its duration was extended on numerous occasions. First introduced in 2008, the scheme—also known as the ‘bring your money in, I won’t ask where it came from’ initiative—allowed unregistered assets to be brought into the country and registered under Law No. 5811, subject to a 2% tax payment.
In 2013, the scheme was reintroduced under Law No. 6486, with the 2% tax rate remaining unchanged. By 2016, a bill under Law No. 6736 was again submitted to the Turkish Grand National Assembly by AKP MPs and passed into law.
In 2018, the asset amnesty scheme was implemented under Regulation No. 7143. The scheme, which was due to remain in force until 30 November 2018, was extended by six months by a Presidential Decree. It remained in force until 31 May 2019. Just one and a half months after the scheme expired on 31 May, the government introduced the asset amnesty scheme once again on 19 July 2019 via Regulation No. 7186. With the extension, the scheme remained in force until 30 June 2020.
In 2020, the same scheme was re-enacted via Regulation No. 7256. The regulation, which came into force on 17 November 2020, expired on 30 June 2021. However, the government extended the period once again, applying the asset amnesty throughout 2021.
This scheme was invoked for the final time in 2022. Under the legislation introduced by Bill No. 7417, it became possible to declare certain assets held abroad and repatriate them to Turkey, as well as to declare certain assets held domestically that were not recorded in official registers and have them entered into the records. It was stipulated that the tax rate would be set at 0 per cent provided that the declared assets were held for at least one year from the date they were transferred to accounts opened at banks or financial institutions in Turkey, or deposited into such accounts after being brought from abroad.
‘The economy cannot recover without tax balance’
CHP Deputy Chairman Özgür Karabat stated, ‘Without tax balance, the economy cannot recover. Everyone pays the same tax regardless of their income. The same tax applies to bread as it does to luxury goods. It is impossible to call this fair; this model is unsustainable. Prosperity does not increase by deepening injustice. Without tax balance, the economy cannot recover.’
Speaking via his social media account, Karabat said, “Everyone pays the same tax regardless of their income. The same tax applies to bread as it does to luxury goods. It is impossible to call this fair; this model is unsustainable. Prosperity does not increase by deepening injustice. The economy cannot recover without tax balance.”
‘There is no other government in the world that so openly declares it will “exploit” its citizens. Once again, tax exemptions have been granted to profiteers and the wealthy, whilst the public is told, “you must continue to pay VAT and excise duty”,’ he said.
Trade deficit rose by 56 per cent in March
According to TurkStat data, the trade deficit in March rose by 56 per cent compared to the same month of the previous year, reaching 11 billion 221 million dollars. This marks the largest monthly deficit since April 2025.
Over the three-month period, the trade deficit increased by 27.5 per cent to 28 billion 667 million dollars.
Growth in the Eurozone falls short of expectations
The Eurozone economy grew by 0.1 per cent in the first quarter of this year compared to the previous quarter.
In the German economy, however, growth exceeded expectations. The economy grew by 0.3 per cent in the first quarter, surpassing forecasts. The growth was driven by increases in household consumption and public spending.
Inflation in Europe at a three-year high
Annual inflation in the Eurozone reached 3 per cent in April, driven by rising energy prices, marking a three-year high.
Annual inflation in the Eurozone, which stood at 2.6 per cent in March, rose to 3 per cent in April. Month-on-month inflation stood at 1 per cent in April. The 3 per cent inflation rate marked the highest level recorded in the region since September 2023.
Other key developments of the week are as follows:
Finance Minister Mehmet Şimşek noted that rising energy costs, driven by the war, have contributed to the deterioration in inflation expectations. Şimşek emphasised that policies aimed at ensuring price stability would continue.
Cengiz Holding has received yet another favour. The Eti Aluminium plant in Konya has been declared a special industrial zone by presidential decree, paving the way for tax exemptions.
The Ministry of Trade has expanded the scope of measures taken to prevent speculative movements in raw material prices within the agricultural sector. In this context, it has removed customs barriers on the import of solid ammonium nitrate and monoammonium phosphate, products of vital importance for agricultural production.
Under a circular issued by the Social Security Institution (SGK), the limit for interest-free instalment plans has been increased for employers, tradespeople and Bağ-Kur members with outstanding contributions. The previous requirement to provide collateral of 50,000 TL has been raised to 250,000 TL. Those with outstanding debts will now be able to obtain a ‘no debt’ certificate if they arrange to pay their debts in instalments under the terms of the circular.