How much is the minimum wage in Turkey in October 2021?
The government has increased the minimum wage to 2,825 Turkish Liras (roughly $379) in the beginning of 2021.
Since Turkish lira has been losing its value dramatically, the minimum was has seen as low as $293.00 in October 2021. That is lower than most third world countries’ minimum wage.
The hourly minimum wage in Turkey is as low as $1.63.
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China’s Minimum Wage
Effective Aug. 1, 2021, Beijing (Chinese) increased its monthly minimum wage to 2,320 yuan (U.S. $360.01) from 2,200 yuan (U.S. $341.39), the Beijing Municipal Human Resources and Social Security Bureau said. The bureau also said the hourly minimum wage increased to 13.3 yuan (U.S. $2.06) from 12.64 yuan ($1.96).
Is Turkey Becoming New China?
The Turkish central bank cut its key interest rate for the second straight meeting on Thursday, pushing the lira to a record low even as business leaders question the direction of monetary policy under President Recep Tayyip Erdogan.
The bank lowered the one-week repo rate to 16% from 18%, despite the lira plumbing new lows over the past several weeks. The Turkish currency weakened by nearly 3% against the dollar at one point following the Thursday decision.
The move comes as Erdogan, who has called interest rates the “mother of all evil,” ramps up pressure on the central bank to stimulate the economy.
When inflation runs high and currencies are in free fall like the lira, monetary authorities typically look to rate hikes as a remedy. Turkey has moved in the opposite direction.
As mentioned above, it is obvious that Turkish labor will be cheaper to hire. This makes Turkey a cheap manufacturer on the door of EU countries.
But there are some disadvantages to this compared to China and Turkey. In addition to its low labor costs, China has become known as “the world’s factory” because of its strong business ecosystem, lack of regulatory compliance, low taxes and duties, and competitive currency practices. Here we review each of these key factors.
KEY TAKEAWAYS
- Given the abundance of Chinese products in the marketplace, it’s understandable consumers might wonder why so many goods are made in China.
- One of the reasons companies manufacture their products in China is because of the abundance of lower-wage workers available in the country.
- China’s business ecosystem of networked suppliers, component manufacturers, and distributors has evolved to make it a more efficient and cost-effective place to manufacture products.
- While Western manufacturers comply with various health, safety, employment, and environmental regulations, Chinese manufacturers generally operate under a much more permissive regulatory environment.
- China has been accused of artificially depressing the value of its currency in order to keep the price of its goods lower than those produced by U.S. competitors.
