Foreign capital inflow may be below expectations
Posted by meb at February 16th, 2008
The United States economic crisis will have a negative influence on Turkey in terms of mergers and acquisitions in 2008, said Hüsnü Can Dinçsoy of PricewaterhouseCoopers Turkey. “This year, foreign capital inflow may stand below $20 billion,” Dinçsoy, partner at the assurance, tax and advisory services company said.
Particularly foreign capital funds and hedge funds will abstain from investing in an environment of uncertainty, said Dinçsoy. “In many countries, foreigners do not pay taxes in the first five years of their arrival. We fall behind, as we do not have such a promotion…. Bureaucracy in Turkey deters investors.” The privatizations of Halkbank, as as well as the state owned alcohol and Tobacco Company Tekel and electricity distribution will loom large in 2008, said Diçsoy. “Foreign capital funds may enter each sector. They may be interested particularly in highway privatizations. I expect acquisitions in health and real estate sectors. Of course, if economic crisis deepens in Turkey, we will not be able to attain $20-billion foreign capital inflow attained last year.”
The companies trading at the stock exchange will lose value after the crisis, said Dinçsoy. “If the wave of the economic crisis comes to Turkey, discount rates will also be affected. Discount rates, ranging between 10-12 percent depending on sectors, may have upward trend. I predict there will be lower values in company valuations.”
source: Referans via Turkish Daily News
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