Restaurants sit half-empty in Turkey this summer as inflation reaches 91% in places

Angry citizens have taken to social media to share their bills, including the equivalent of $640 for food and drinks for five people in Bodrum and $30 for five scoops of ice cream in Cesme. Meanwhile from Mediterranean Greek islands just a few kilometers away, their fellow Turks boast they’re paying far less than prices at home.

“There’s a huge difference between the service and product quality, as well as prices here and there,” said Murat Yavuz, a retired Turkish banker who regularly visits Greece. “Restaurants here have used inflation as a pretext to push up prices.” 

Restaurant and hotel prices rose by an average 91% in June from a year earlier, topping already eye-watering headline inflation of 71.6%. The sector constitutes a third of the services economy that the central bank has highlighted as a particular cause of concern in its fight against spiraling prices.

The exodus has been helped by the launch of a fast-track visa program in March this year as part of a diplomatic effort to ease tensions between the long-time rivals. And Turks are not the only ones swarming Greece’s islands. Tourists from around the world have flocked there in such large numbers that the country is now considering imposing restrictions on cruise ships.

“We’ve lost our price advantage,” Kivanc Meric, an executive at the Association of Turkish Travel Agencies, told Euronews in an interview, citing the “over-valuation” of the Turkish lira. Meric said he expects as many as 150,000 Turks to go to the Greek island of Samos this year, up from around 40,000 in 2023.

The lira’s real effective exchange rate, a measure of its value against foreign currencies, is at its highest level since late 2021.

Eateries across the country are seeing an erosion of purchasing power among clients. Kaplan Ilhan, 57, chef at a fish restaurant in the resort town of Kusadasi, said business has declined by about 25% compared to last season. “The cost of living is a factor, but rumors on social media about Greece being cheaper also play a big role,” he said.

The 128-branch Big Chefs casual dining chain has seen its overall customer numbers rise as “the upper segment is shifting to us,” said Chairwoman Gamze Cizreli. “But we’re observing a decline in spending per person.” The company is cutting costs to cope with the decline, including by producing its own electricity, she added.

“With interest rates at 50% and inflation above 70%, people are in shock,” said Baris Tansever, founder of the upmarket Sunset Grill & Bar in Istanbul, who says business is down about a quarter from last year. 

Prices are now out of reach for the white-collar crowd he aimed to attract when he opened his restaurant in 1994, Tansever said. 

“We’re all getting poorer.”