User:Francoisealey/1994 Turkish currency crisis

"1994 Turkish economic crisis" redirects here. For other uses, see 1994 Turkish economic crisis (disambiguation).

Prime Minister Tansu Çiller, who oversaw the currency crisis

A severe financial crisis afflicted Turkey in 1994, resulting in a severe depreciation of the Turkish lira and a substantial increase in inflation. The drastic depreciation of the lira in the crisis has lead economists to describe the crisis specifically as a currency crisis. Real GDP shrank, paring with a large drop in output and productivity. Real wages dropped 20%, neccessitating the creation of a stabilization program which involved the implementation of harsh austerity measures.

The crisis, combined with the İSKİ Scandal, undermined support for the ruling True Path Party, resulting in a surge of support for Necmettin Erbakan. Recep Tayyip Erdoğan, campaigning under Erbakan's Welfare Party, won the 1994 Istanbul mayoral election after electoral defeats, tied to the worsening economic situation, weakened the major establishment parties.