The monetary and fiscal policies implemented for struggling with inflation in Turkey:Analysis of 2001-2011 years

Turkey introduced the phenomenon of high inflation in the 1970s. Increase in oil prices, public sector deficits, financing these deficit with the Central Bank sources and excessive debt have been among the main factors that cause high inflation in our country. For over thirty years, economic activities have been continued under the pressure of high inflation in the country, distorted disribution of income, increased speculative investments, impaired balance of foreign trade and development process has been broken. A case of inflation with other structural problems in the economy caused economic crises which was repeated at short intervals and had poor results. Moreover, these economic crisis increased the rate of inflation significantly.After these economic crisis, stabilization programs have been implemented to reduce inflation framework Stand-By agreements with the IMF. However, these stabilization programs have been unsuccessful because of height of the current account deficit, the unhealthy structure of the financial sector and high public debt.Most recently, inflation has been reduced to single digits in the last decade with the Transation Program to Strong Economy which was implemented with the support of the IMF after the crisis of 2001. Many factors are effective in the success of this program. These factors are legal and institutional arrangements for the restructuring of the financial system, improving the public finance structure as a result of tight fiscal and monetary policy implementation and inflation targeting regime which providing coordination of monetary and fiscal policies are important in the success of this program.