Turk­ish growth ben­e­fi­cial for global econ­omy, ex­perts say

Daily Sabah (Turkey) - - Front Page -

GLOBAL econ­o­mists said that Turk­ish growth, which hit 5.1 per­cent in sec­ond quar­ter, was a pos­i­tive de­vel­op­ment for the global econ­omy, as Com­merzbank Se­nior Emerg­ing Mar­kets Econ­o­mist Tatha Ghose said Tur­key re­gained con­fi­dence in the coun­try’s in­vest­ment en­vi­ron­ment.

FOL­LOW­ING the an­nounce­ment of Tur­key’s growth data in the sec­ond quar­ter, which hit 5.1 per­cent, global econ­o­mists eval­u­ated the growth as a pos­i­tive de­vel­op­ment. Com­merzbank Se­nior Emerg­ing Mar­kets Econ­o­mist Tatha Ghose said Tur­key has re­gained con­fi­dence in the coun­try’s in­vest­ment en­vi­ron­ment. On the other hand, Rabobank Emerg­ing Mar­kets Ex­change Strate­gist Piotr Matys stated that the coun­try’s econ­omy has quickly re­cov­ered from the neg­a­tive eco­nomic im­pact of tu­mul­tuous po­lit­i­cal events of last year.

Com­merzbank’s Ghose said Tur­key could grow by 5.8 per­cent in 2017.

Speak­ing to Anadolu Agency (AA) re­gard­ing Tur­key’s 5.1 per­cent growth in the sec­ond quar­ter, Ghose noted that the Turk­ish econ­omy has geared up for the fu­ture and con­fi­dence in Tur­key’s in­vest­ment en­vi­ron­ment has been re­stored.

Un­der­lin­ing that tourism is an im­por­tant fac­tor in the suc­cess of the Turk­ish econ­omy and that the sec­tor is de­vel­op­ing, Ghose stated that the num­ber of tourists com­ing to Tur­key has reached nor­mal lev­els and that this is a sig­nif­i­cant de­vel­op­ment in terms of the cur­rent ac­count deficit.

Ghose said the in­fla­tion out­look has not made much progress, as­sert­ing that this has not had a pro­found ef­fect on the mar­kets, while ex­plain­ing that the out­look on Turk­ish as­sets has been largely re­garded as pos­i­tive.

Ghose went on to note that Tur­key achieved broader-based de­vel­op­ment in the sec­ond quar­ter, adding that sec­ondquar­ter growth was not achieved with pub­lic ex­pen­di­tures as th­ese ex­pen­di­tures de­creased in this pe­riod.

The econ­o­mist stressed that Tur­key’s econ­omy could grow by 5.8 per­cent in 2017 and that the com­bi­na­tion of the U.S. Fed­eral Re­serve’s (Fed) pos­si­ble in­ter­est rate hike and other global high in­ter­est rates are neg­a­tive fac­tors for Tur­key’s growth in 2018.

‘TUR­KEY’S GROWTH RATE IS VERY IM­PRES­SIVE’

Rabobank Emerg­ing Mar­kets Ex­change Strate­gist Piotr Matys stated that the Turk­ish econ­omy is rapidly re­cov­er­ing from the slow­down it ex­pe­ri­enced due to the July 15 coup at­tempt and ter­ror­ist at­tacks in the coun­try, adding that Tur­key’s growth rate is very im­pres­sive and its medium-term out­look is also en­cour­ag­ing.

Matys said fi­nan­cial in­cen­tives have con­trib­uted to growth but re­it­er­ated that growth with­out struc­tural re­forms may not be sus­tain­able, stat­ing that struc­tural re­forms will in­crease do­mes­tic sav­ings, pro­duc­tiv­ity and in­vest­ments.

Em­pha­siz­ing that strong growth must be con­tin­ued with pri­vate con­sump­tion, in­vest­ments and ex­ports, Matys noted that cap­i­tal in­flows to Tur­key could con­tinue thanks to the signs of in­vig­o­ra­tion ev­i­dent in the econ­omy and the fa­vor­able, ex­oge­nous en­vi­ron­ment.

Em­pha­siz­ing that the Turk­ish lira has re­cently showed re­sis­tance to the risks stem­ming from North Korea, Matys pre­dicted that the dol­lar-lira ex­change rate could drop down to 3.35 by the end of the year.

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