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Şimşek defends 'equalization' fuel pricing: 'Diesel would be 90 lira without it'
🇹🇷 Turkey /Economy & Trade

Şimşek defends 'equalization' fuel pricing: 'Diesel would be 90 lira without it'

From Cumhuriyet · (41m ago) Turkish

Translated from Turkish, summarized and contextualized by DistantNews.

TLDR

  • Turkey's Treasury and Finance Minister Mehmet Şimşek defended the "eşel mobil" (equalization) system, stating it prevents fuel prices from rising significantly.
  • Şimşek explained that without the system, diesel would cost around 90 lira per liter, but is currently priced below 73 lira due to government subsidies.
  • The minister highlighted that the budget covers 75% of the increase in fuel prices, costing the government approximately 90 billion lira in the first two months.

Hazine ve Maliye Bakanı Mehmet Şimşek has robustly defended Turkey's "eşel mobil" system, a crucial mechanism designed to shield citizens and businesses from the volatility of global fuel prices. Speaking on TRT Haber, Şimşek detailed how this system effectively absorbs a significant portion of the price hikes, preventing them from fully impacting the pump prices that consumers and industries face daily.

Eşel mobil olmasaydı bugün mazot 89,4 lira olurdu burada. Yani yaklaşık 90 lira olacaktı. Halbuki şu anda eşel mobil sayesinde fiyat 72,7 lira, yani 73 lira diyelim.

— Mehmet ŞimşekIllustrating the price difference for diesel with and without the 'eşel mobil' system.

Şimşek provided stark figures to illustrate the system's impact. He revealed that without the "eşel mobil" intervention, a liter of diesel would currently cost approximately 90 lira. However, thanks to the government's commitment to subsidizing 75% of the price increase through forgone Special Consumption Tax (SCT), the actual price remains below 73 lira. Similarly, gasoline prices are kept significantly lower than they would be otherwise. This deliberate policy choice, Şimşek emphasized, is a direct result of the government's efforts to support purchasing power, particularly for farmers, tradespeople, and industrialists.

Dolayısıyla dikkat ederseniz yani şokun önemli bir kısmını biz vatandaşlarımıza, Türkiye'de faaliyet gösteren şirketlerimize, sanayicimize, yani esnafımıza yansıtmadık.

— Mehmet ŞimşekExplaining how the system protects consumers and businesses from global price shocks.

The minister also shed light on the substantial fiscal commitment this entails. He disclosed that the "eşel mobil" system resulted in a revenue loss of around 90 billion lira in the first two months alone. Projecting this trend, the total cost for the year could reach approximately 600 billion lira, equating to roughly $13-14 billion. Despite this significant expenditure, Şimşek reiterated the government's dedication to maintaining this support, viewing it as a necessary measure to stabilize inflation and bolster the economy. Furthermore, he hinted at ongoing efforts to attract foreign capital through new incentive schemes, signaling a broader strategy for economic resilience.

Eşel mobil uygulamasının bütçeye ciddi maliyeti olduğunu belirten Şimşek, ilk 2 ayda gelir kaybının yaklaşık 90 milyar lira olduğunu açıkladı.

— Mehmet ŞimşekRevealing the significant budget cost of the 'eşel mobil' system.
DistantNews Editorial

Originally published by Cumhuriyet in Turkish. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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