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Media Centre

Shop owners in north struggling with fall in value of Turkish lira

  • Posted on:  Wednesday, 25 January 2017 09:01


Shop owners in north struggling with fall in value of Turkish lira                                                                 


Small shop owners in the occupied areas are struggling after the Turkish Lira lost value against the US dollar, British pound and the euro.

“We cannot keep up with foreign currencies gaining value against the Turkish lira and the cost of living increasing. I no longer have that many customers anyway. I survive on the shopping my neighbours make. But it is a fact that life is going to become more and more expensive,” Mustafa Göymen, a shopkeeper in Arasta, the historic shopping area at the centre of the walled city in Nicosia said.

With the increase in the value of foreign currency, the price of household electricity has also increased as diesel for the main power plant in the north is paid for in US dollars.


In the last six months, the value of the dollar against the Turkish lira has increased by 31 per cent, the euro by 26 per cent, and sterling by 21 per cent. The increased value of foreign currency sees a corresponding rise in the price of nearly all imported goods.

The rise in prices has forced consumers to cut spending except for food items, leaving shop owners from Nicosia, Kyrenia, Famagusta and Rizokarpaso unable to pay the rent, which is charged in British pounds due a lack of confidence in the Turkish lira.

The prices of property and vehicles in the north are in foreign currency for the same reason.

“As a sector we are bankrupt,” said Musfata Bostanci, a shop owner in Kyrenia who trades in cloth. “The fabric market purchases products in foreign currency. The purchasing power of the people has dropped because everything is in foreign currency. We get our salaries in Turkish lira, but everything else is in foreign currency. What kind of a country are we living in? I do not believe that the Cyprus problem will be solved. That is why they (the politicians) should pay attention to the people.”

Doğan Zorlu, a barber from Famagusta said that the price of the materials they use increased by 30 per cent in the last month.

“Small shop owners are finished. A lot of them are considering shutting down. The sudden rise in the value of foreign currencies has made the people poorer,” he said.

The shop owners also complain there has not been an increase in the minimum wage, the income of the majority of the shops’ clientele.

Sevgül Metni, a grocery shop owner in Rizokarpaso, appealed for an immediate rise in salaries.

She said the drop in peoples’ purchasing power meant poor sales and difficulty in meeting her own obligations.

“It is the 13th of the month and I could only pay my rent today and with difficulty,” she said.

After weeks of criticism, ‘deputy prime minister’ Serdar Denktash said they would look into revising the price hike in some goods and services.

However ‘prime minister’ Hüseyin Özgürgün said on Tuesday the administration could not do anything about the price increase for goods such as petrol, gas and electricity, and services provided by public offices, but they will consider increasing the basic salary. In 2016 the north saw a 21 per cent rise in electricity prices while the price of petrol rose 20 per cent.