July 21, 2011
We can be very optimistic about the future of Turkey and its economy.
At first, a reminder: Episode I: A perspective of the Turkish economy.
Now here are several recent articles about the good health of the Turkish economy:
Turkey’s economy beat expectations in the first quarter of 2011 with 11 percent growth, thanks to special consumption expenses and investments, according to the Turkish Statistics Institute (TurkStat). With this growth rate, Turkey bettered the biggest economies of the world in the first quarter and is expected to surpass $742 billion, its pre-crisis 2008 gross domestic product. According to TurkStat data, Argentina and China followed Turkey with respective growth rates of 9.9 percent and 9.7 percent. Turkey’s year-end 2011 growth is expected to exceed 7 percent.
Private capital flows to emerging markets should top $1 trillion this year, fueling growth in the global economy, according to a new report by an international banking association. According to the report, released Wednesday by the Institute of International Finance (IIF), Turkey will attract a large of these inflows. IIF Deputy Director Jeremy Lawson, who does global macroeconomic analysis, said last year’s $45 billion capital flow to Turkey will rise to $74 billion this year and $80 billion in 2012.
Turkey is in a process of dynamic development and its economy is steadily growing while inflation has fallen, said Justin Yifu Lin, chief economist and senior vice president of the World Bank, in Uzbekistan yesterday. Turkey’s growth is continuous and sustainable, added Lin, partially thanks to government policies that are open to cooperation based on shared interests with other countries. Turkey also managed to bring once-sky high inflation under control.
At a meeting with economic journalists, Turkey’s newly appointed Economy Minister Zafer Çağlayan described current account deficit as a problem that exists from the past.
“This is a headache not only for Turkey. 128 countries have this problem. We will definitely solve this problem,” Çağlayan said.
Turkey’s current account deficit rose 121.3 percent to $37.2 billion in the first five months of 2011 when compared to the same period of 2010, indicating an increase of $20.4 billion, Central Bank announced on Monday.
Çağlayan said the government would struggle to reduce current account deficit by the help of measures aiming to mitigate country’s dependence on imports. He said the government was working on particular sectors.
Çağlayan criticized analysts who argued that current account deficit was a threat for Turkey, saying: “Turkey’s has a much more robust economic balance when compared with the past.”
Çağlayan also said that overvalued Turkish currency was a major factor that caused rise in current account deficit, as “overvalued Turkish lira caused a big boom in imports.”
“I never wanted to blame Central Bank but we are suffering the consequences of wrong policies made by Monetary Policy Committee,” he said.
In Istanbul yesterday, Jeff Anderson, head of the Institute of International Finance’s (IIF) European Department, lauded Turkey’s “stunning” economic growth. Speaking as a guest of Garanti Private Banking about Turkey’s economic performance in recent years, Anderson said Turkey has a significant gross domestic product growth rate, adding that he foresees double-digit growth for the first quarter of 2011. Stating that inflation is also low, Anderson said Turkey is among the world’s top developing markets.
Though Turkey is below the European Union average in research and development expenditures, the gap is closing fast, with a significant increase over the last decade, according to a new EU report. Over the period 2000-2009, gross domestic expenditures on R&D in Turkey saw an average annual growth rate of 10.1%, which is the fourth-highest growth rate in Europe, said the 2011 Competition Report of the European Commission’s Innovation Union.
ISTANBUL – Speaking at the award ceremony of the Business Plan Competition held by the Massachusetts Institute of Technology (MIT) and Toyota Corporation in Istanbul, Bağış said that the fact that MIT, one of the most prominent universities in the world, and Toyota’s hosting the Competition participated by over 3,000 business plans shows that Turkey is ready to reach its vision for 2023, the year that marks the 100th anniversary of the establishment of the Republic of Turkey.
Turkey now plays in a different platform. Once Europe’s ‘sick man’, Turkey has become Europe’s fastest growing economy.
While the EU grew by 1.5 percent in 2010, Turkey’s growth rate was 8.9 percent, Bağış said.
Bağış congratulated all entrepreneurs for their business plans.
25 May 2011
Henri de Castries, Chairman & Chief Executive Officer of the Axa Group, said on Wednesday that Turkey was a promising market.
“We want to double our investments in Turkey,” de Castries said while addressing a meeting in Istanbul where 350 CEOs of Axa convened.
In an exclusive interview with the A.A correspondent, de Castries gave information about insurance sector in Turkey and targets of Axa.
He said Axa was aiming at growth particularly in areas of household insurance, accident insurance, and life insurance, “Turkey is one of the most important economies in Asia, Central and East Europe and the Mediterranean region. We have been operating in Turkey for 10 years. We see Turkey as a very strong economy in the future. We are pleased over the results of Axa Turkey. We win new customers as our operations are competitive.”
De Castries said although all the sector lost money, the accounting profit of Axa insurance was posted at 87.3 million lira after the taxes.
Axa CEO underlined the importance the company felt to future of Turkey’s economy.
25 May 2011
Saudi Arabia foresees making investments of $600 billion in Turkey during the next 20 years, according to Abdul Kareem Abu al-Nasr, the chairman of National Commercial Bank, the largest Saudi lender.
“In the agriculture space, Turkey emerged as one of the top recipients of Saudi investment, as the kingdom seeks to boost its food security,” he said in the document.
The very interesting article below ought to be read too:
The projects in Diyarbakır (a town infested with the terrorist group the PKK) are promising.
No doubt that Diyarbakır will be a much better place to live for all its citizens.
I also want to remind the other numerous projects that strengthen and will strengthen the Turkish economy:
2/ Channel Istanbul (that huge project will not create 10 000 jobs but much more. And as far as I understood the Bosphorus will be closed to the industrial traffic. The objective is to use only Channel Istanbul for that kind of traffic. The Montreux treaty didn’t foresee the oil and chemical tankers to go through the Bosphorus, that is why Turkey’s argument to close the Bosphorus to them is really excellent and makes sense).
I will keep introducing the main positive news about the Turkish economy.
PS. Update of July 21st 2011 – 04:35 PM
World Bank President Robert B. Zoellick said in Ankara yesterday that Turkey’s unique growth model sets an example for world markets, most of which are currently struggling. Zoellick met with Deputy Prime Minister and former Economy Minister Ali Babacan during his visit to Ankara early yesterday. Noting that Turkey was an important economy in its region, Zoellick said the country’s economic program was “very strong” because Turkey focused on “restructuring its economy with a strategic approach.” The World Bank head also recalled that Turkey has implemented very important structural reforms in its economy since the year 2002. Underscoring that there was increasing interest in Turkey’s economic achievements, not only in its region but also in global markets, Zoellick underlined Turkey’s growth success. Despite the positive picture he drew, Zoellick had some reservations. He said some countries were growing rapidly, while others had a relatively slower growth rate, which could be a problem. Asked about the International Monetary Fund (IMF) recently projecting only 2.5 percent growth in the Turkish economy in 2012, the World Bank director said that such estimates were not realistic for Turkey. “I guess they have miscalculated something here,” he opined.cem