Small and medium-sized enterprises are caught in the tide of bankruptcy! What is the reason for the increase in inflation in Turkey?

This is mainly because of Turkey's economic development model, and inflation will further make the development of small and medium-sized enterprises very difficult, and the financing channels of many enterprises will become narrower and narrower.

To some extent, inflation will lead to a series of economic problems. In the case of inflation, many places may adopt the way of currency deceleration to deal with inflation, and at the same time, they will take the initiative to raise the deposit and loan interest rates. Under this trend, because the development of small and medium-sized enterprises needs certain financing behavior, when the financing cost is getting higher and higher, the development of many small and medium-sized enterprises will be restricted, and some small and medium-sized enterprises will even go bankrupt because of the problem of capital chain.

Small and medium-sized enterprises in Turkey have fallen into the tide of bankruptcy.

In the case of high inflation, a large number of small and medium-sized enterprises in Turkey began to fall into the tide of bankruptcy. In this process, many enterprises can't even afford the rent and the wages of their employees, so many enterprises can only choose bankruptcy. Especially for those enterprises with weak financial risk tolerance, the cost of goods produced by these enterprises will even be higher than the selling price of goods.

This is mainly due to Turkey's own economic development model.

The reason is that Turkey's monetary model is relatively loose. In this context, the inflation problem in Turkey will become more and more serious, which will lead to the depreciation of Turkey's local currency. After that, when all kinds of enterprises apply for loans from banks, the financing cost of small and medium-sized enterprises will become very high, but the profit of goods will become very narrow, which will make many small and medium-sized enterprises unsustainable.

Finally, this situation does not only happen in Turkey, but also in many emerging economies, where inflation and difficulties in the development of small and medium-sized enterprises will occur. In order to effectively solve this phenomenon, the local government must introduce various preferential measures to encourage the development of small and medium-sized enterprises.