Onur Çanakçı: The increase in the number of applications for bankruptcy shows that the debt burden has become unbearable for businesses.
Composition provides a kind of “breathing space” for companies that cannot pay their debts, allowing them to enter into a restructuring process with creditors. However, the increase in compositon applications is an indication that the debt burden has become unbearable for businesses.
Compositions and bankruptcies are an important warning for the future of the real sector. Since the real sector is the backbone of employment and production, chain bankruptcies can increase unemployment and social problems. Especially for SMEs, it has become critical to develop new support mechanisms and accelerate collection processes.
Ease of Access to Finance: Despite tight monetary policy, selective credit opportunities should be provided. Low-interest credit programs can be applied especially to exporting and foreign exchange earning sectors.
- Protection Against Exchange Rate Risk: Exchange rate risk management programs should be developed for companies with foreign currency debt.
- Collection Assurance: Expanding trade receivables insurance practices can help protect SMEs from chain debt crises.
- Legal Reforms: Concordat processes should be made faster and more effective, and malicious use should be prevented.
The increase in bankruptcies and bankruptcies has once again brought to light the vulnerabilities in the real sector of the Turkish economy. If the necessary steps are not taken, this situation may worsen and cause serious socio-economic consequences such as employment losses and decrease in production. Strengthening the financial architecture and increasing support for the real sector will be the most critical steps to turn this crisis into an opportunity.
Diken
