Turkey Financial News

Posted by meb at October 2nd, 2009

Turkey’s economy may shrink 6.5 percent this year, the International Monetary Fund, or IMF, said in a report Thursday, revising a previous outlook to predict a deeper recession.

The IMF’s prediction exceeds the government’s estimate of a contraction of 6 percent this year and is more than the 5.1 percent shrinkage the fund predicted its World Economic Outlook in July.

“The government last week revised down its own growth assumption for 2009 to minus 6 percent, with 3.5 percent growth forecast in 2010, so the IMF’s latest forecasts are more or less in line with the official view,” said Tim Ash, chief of Europe, Middle East and Africa research at Royal Bank of Scotland in London, wrote in an e-mailed report to investors.

“A 3.5 percent to 3.7 percent growth rebound seems optimistic in our view, given the global context still, albeit with a minus 10 percent print for the first quarter of the year, the low base period effect should kick in.” (more…)

Posted by meb at October 2nd, 2009

The International Monetary Fund (IMF) said on Thursday that the global economy is recovering faster than expected and estimated a 3.7 percent growth rate for Turkey in 2010, after a global recession cause the country’s economy to contract 6.5 percent this year.

The fund said in its latest World Economic Outlook that it expected the inflation rate in the country to stand at 6.2 percent this year before increasing to 6.8 percent in 2010. The report estimated that Turkey’s current account deficit to gross domestic product (GDP) ratio would increase to 3.7 percent in 2010 from 1.9 percent this year.

According to the twice-yearly outlook, which was announced in İstanbul ahead of the upcoming Annual Meetings of the Boards of Governors of the World Bank Group and IMF, the world economy is poised to grow by 3.1 percent in 2010 with much of the recovery driven by emerging economies such as China and India. That is up from the 2.5 percent in the IMF’s previous set of estimates. And for this year, the IMF now projects a 1.1 percent decline in the global GDP instead of the 1.4 percent contraction it predicted in July. (more…)

Posted by meb at October 2nd, 2009

Turkey’s quota in the International Monetary Fund (IMF) is expected to increase to more than 1 percent, giving Turkey the opportunity of getting more financial aid at a lower cost under new reforms which are expected to be high on the agenda of this year’s meeting of the fund, IMF sources were reported as saying on Thursday.

Turkey’s ad hoc quota currently stands at about 0.6 percent after it was increased from 0.45 percent during the annual meetings of the IMF-World Bank in 2006. Another twofold increase is expected to take place in this year’s meeting of the fund, increasing the quota from 1 to 1.5 percent. (more…)

Posted by meb at October 2nd, 2009

An increasing number of people believe Turkey has reached a point where it can overcome the ongoing global economic crisis without the support of the International Monetary Fund (IMF), Prime Minister Recep Tayyip Erdoğan said on Wednesday.

Speaking at the opening ceremony of the 2009-2010 academic year at Dokuz Eylül University, Erdoğan noted that since the crisis broke out, everyone has made recommendations on how Turkey can best overcome it. “There were people who claimed that Turkey could not overcome the crisis without the support of the IMF. They were saying a deal should have been signed with the IMF immediately. But we ignored these people,” he said. Erdoğan pointed out that they refused to sign an agreement without reaching a satisfactory compromise that would benefit Turkey. He explained that Turkey had talks with the IMF and evaluated the institution’s recommendations in the economic and financial fields but would not tolerate any intervention in the political sphere. “Turkey is not like it used to be, when it used to hold talks with the IMF in the event of the smallest crisis and when it agreed to every condition proposed by the IMF,” the prime minister said. (more…)

Posted by meb at September 24th, 2009

Economy Minister Ali Babacan said on Wednesday that talks between Turkey and the International Monetary Fund (IMF) over a stand-by agreement are still under way and that some adjustments can be made to a recently announced medium-term economic program if an agreement is reached with the IMF.

Delivering a speech at the International Economic Alliance’s Global Investment Symposium in New York on the sidelines of the United Nations General Assembly and a G-20 summit in Pittsburg scheduled for Sept. 24-25, Babacan briefed the participants about recent economic developments in Turkey.

Stressing that Turkey and the IMF are now more likely to sign a deal than they were three to four months ago, he noted that negotiations will continue on the basis of the government’s recently announced medium-term economic program, which focuses on putting budget balances back on track between 2010 and 2012. “If we reach an agreement over details, we can make adjustments to the program,” the minister said. (more…)

Posted by meb at September 17th, 2009

Ali Babacan, the Turkish Economy minister, announced Turkey’s much-anticipated medium-term economic plan yesterday which experts had been speculating would be focused on putting budget balances back on track between 2010 and 2012.
Although some feared that the plan might be unrealistic in its expectations, the consensus amongst pundits that Today’s Zaman spoke with was that the program is quite realistic in its outlook but has fuelled suspicions that the government may be planning to implement reforms without the input of an International Monetary Fund (IMF) stand-by agreement.

Commentators say that they find the creation of a “fiscal rule”, the legal framework of which will be announced early next year, to acheive long-term fiscal sustainability to be the most positive of the statements.

According to statements made by Babacan yesterday, the government foresees growth to contract by 6 percent by the year’s end — significantly higher than the 3.6 percent contraction envisaged earlier — before experiencing a modest rebound to 3.5 percent in 2010, 4 percent in 2011 and 5 percent in 2012. (more…)

Posted by meb at September 17th, 2009

Economy Minister Ali Babacan announces the government’s long-awaited, medium-term economic program in Ankara, emphasizing that talks with the International Monetary Fund will go on from now on based on this program. ‘IMF financing is not a must,’ he says, but notes that the difference of opinion between the government and the fund has narrowed

The Turkish government has announced plans to lower budget deficits over the next three years, saying the proposals may form the basis for a new lending accord with the International Monetary Fund, or IMF.

Under the medium-term economic plan announced by Economy Minister Ali Babacan in Ankara on Wednesday, debt will rise as a proportion of economic output this year and next, before starting to decline in 2011. Future talks with the IMF may be based on the program, though Turkey doesn’t need the fund’s cash and hasn’t included it in the fiscal projections, Babacan said. (more…)

Posted by meb at September 17th, 2009

Turkish banking industry proves to be a high-profit business as its profit rises 33 percent to 11 billion Turkish Liras in the second quarter of the year. Although the banking industry has been displaying a great performance despite the global economic crisis, however the rising number of non-performing credits may be perceived alarming

The Turkish banking sector has increased its net profit by 33 percent in the second quarter of this year compared to the same period last year, official figures revealed.

The sector raised its net profit to 11 billion Turkish Liras, according to the quarterly Financial Markets Report prepared by the Banking Regulation and Supervision Agency, or BRSA. (more…)