As we prepare to leave 2022 behind, let's first have a look at the risks that topped the lists of the world's think tanks and international economic organizations: the possibility of new variants of COVID-19 forcing countries to enforce new quarantines and restrictions; whether the ongoing price fluctuations in global commodity prices due to supply chain bottlenecks would continue the pressure on global inflation until the beginning of summer 2022; whether the tendency to suppress rising inflation with high-interest rates, especially by the United States Federal Reserve (FED) and the European Central Bank (ECB), would lead to stagnation while possibly not succeeding in slowing down the inflation rate as expected; and whether the pandemic would drag leading economies to the "stagflation risk" with increasing unemployment.

According to my 2021-2022 global and local economic expectations assessments published this time last year, on top of the three key risks for 2022 listed in the paragraph above, the fourth risk was threats from China and Russia. The risk from China was Beijing's possible inability to provide or considering not providing raw materials, intermediates, rare earth elements, chips and final products to the global supply chain, using the COVID-19 risk and restriction-quarantine measures against the coronavirus as an excuse to intimidate the Atlantic countries. This risk significantly happened and problems originating from China and Asia in the global supply chain caused serious delays in the production and delivery of sectors, especially in the automotive and smart devices industries. In the automotive industry, deliveries were delayed by three to six months.

However, without a doubt, the risk from Russia, which we mentioned at the end of last year, namely the risk of Russia escalating the Ukraine-based regional and global problem, Russia's launch of a military operation at the very beginning of the year against Ukraine on Feb. 24 and with the start of Russia-Ukraine war, it escalated to a level beyond the forecasts of the leading actors of the global economy-politics. Unfortunately, the risk that we mentioned in the report to be considered has come true.

However, even in 2019, the risk of a global virus epidemic that would affect the whole world and the possibility of a regional hot conflict turning into a global political crisis was ranked quite low among the global risk headings in the global risk analysis made by the world's leading organizations. This type of reoccurrence is unlikely; however, when realized, such developments that shook the whole world with their main and aftershocks are called "black swans" in the international economic-political literature.

From the end of 2019 to the end of 2022, the three years we left behind in the shadow of two "black swans," namely the COVID-19 pandemic and the Russia-Ukraine war, brought crucial tests and challenges for the whole world, and of course for Türkiye, in terms of the world economy and global trade.

Türkiye to end 2022 with growth

With a "smart" economic policy that supports the real sector and exports in the field of economy, Türkiye was among the 50 leading economies of the world in 2020, the fourth among only five countries that finished the year with positive growth and ended 2021 with an increase of over 11%, ranking second among the Organisation for Economic Co-operation and Development (OECD) countries and third among G20 countries. The new reports of the OECD, the International Monetary Fund (IMF) and the World Bank (WB), all the leading organizations of the world economy, reveal that Türkiye will end this year again with high growth performance, again at the top two in the OECD and in the top three in the G-20. It also saw export records broken one after the other with an export volume that will exceed $250 billion for the first time in the history of the republic.

The last risk we mentioned for 2022 was that the leading countries, in terms of fiscal policy, could experience a narrowing of the public financial support to back large masses of people due to their excessively high public debts and severe budget deficit problems. That also happened. Even before the problems and effects of the global pandemic were over, countries faced serious difficulties in protecting and supporting their households and the real sector against the rise in energy and food prices amid the global energy and food crisis brought on by the ongoing war in Ukraine. Worse still, while there was a serious public debt stock problem, they could not prevent it from getting worse by borrowing even more.

In our next article, we will write about what kind of risks await us in 2023.