TURKEY SHOWED GREAT RE­SILIENCE FROM LAST SUM­MER: EXPERT

Dünya Executive - - OVERVIEW -

Turkey ex­e­cuted a “very im­pres­sive” bounce back from the chal­lenges it faced last sum­mer, an expert from Fitch Rat­ings said on Septem­ber 19.

“Turkey has shown a very im­pres­sive re­silience, flex­i­bil­ity, and re­cov­ered and sta­bi­lized from the fi­nan­cial crisis of last sum­mer,” Ed Parker, Fitch Rat­ings’ man­ag­ing di­rec­tor for the Europe, Mid­dle East, and

Africa EMEA re­gion, told a global con­fer­ence in Lon­don.

Point­ing to Turkey’s strong fun­da­men­tals, Parker said the coun­try’s sov­er­eign bal­ance sheet, low govern­ment debt, and pri­vate banks are in rel­a­tively good shape.

He also praised the dy­namism and flex­i­bil­ity of the Turk­ish pri­vate sec­tor.

Parker also high­lighted that the coun­try posted a cur­rent ac­count sur­plus in­stead of a deficit as well as a de­cline in in­fla­tion.

Ac­cord­ing to the lat­est Turk­ish Cen­tral Bank data, Turkey’s cur­rent ac­count bal­ance posted a $1.2 bil­lion sur­plus this July, im­prov­ing from a $2.2 bil­lion deficit in July 2018.

In Au­gust, con­sumer prices in Turkey rose 15.01 per­cent on a yearly ba­sis, ver­sus an­nual in­fla­tion of 16.65 per­cent the pre­vi­ous month, ac­cord­ing to TurkS­tat, the Turk­ish Sta­tis­ti­cal In­sti­tute.

“They have not had any dif­fi­culty get­ting the cap­i­tal in­flows that they need to fi­nance that. There was a lot of doubt this time last year,” he said.

On the coun­try’s eco­nomic out­look, Parker said there are still sig­nif­i­cant risks, and the re­cov­ery so far owes a great deal to fis­cal stim­u­lus and state banks.

Parker said the un­der­ly­ing gen­eral govern­ment deficit this year is pro­jected to ap­proach four per­cent of GDP.

“We have also seen a de­te­ri­o­ra­tion in banks’ as­set qual­ity, par­tic­u­larly state-owned banks,” he said, adding: “There is still an ad­verse political shock, do­mes­tic, ex­ter­nal, U.S. sanc­tions that are pend­ing, spillover from Syria or from gen­eral un­rest in the Mid­dle East.”

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