is about whether the EBRD was compliant with its own rules when board directors gave their political guidance.” The bank’s directors gave a “guidance” to halt new investment in Russia in 2014 following the imposition of Western sanctions against Moscow for its annexation of Ukraine’s Crimea region.
Turkey’s constitutional referendum on Sunday was part of a political shift that has been negative for the country’s sovereign credit profile, but may facilitate a revival of credit-positive economic reforms, Fitch Ratings said yesterday in a statement. Earlier this year, Fitch downgraded Turkey’s sovereign rating to BB+/Stable reflecting, among other things, the erosion of checks and balances and institutional independence in Turkey in recent years. At the time of the downgrade, Fitch assumed the constitutional amendments would be approved. “The referendum may complete an extended political cycle now that President Recep Tayyip Erdogan has accomplished a key long-standing political goal of increasing presidential powers,” said Fitch. New presidential and parliamentary elections are not required until late 2019. This timeframe should allow the economy to move back up the ruling AKP’s policy agenda.