Treasury official says Turkey bottomed out
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Anatolia News Agency
Oluşturulma Tarihi: Haziran 05, 2009 00:00
ASHKHABAD - Contraction of Turkey’s economy has slowed down. Confidence and expectation indices have also been improving. However, it is too early to determine whether all this indicates a permanent recovery, says İbrahim Halil Çanakcı of the Turkish Treasury.
The rate of decline in Turkish economic indicators has slowed, but it is too early to determine whether this slowdown indicates a permanent and robust recovery, said the undersecretary of the Turkish Treasury. There is a relative rally in short-term production and activity indicators, İbrahim Halil Çanakcı said during his visit to Ashgabat, the capital of Turkmenistan, for the annual meeting of the Islamic Development Bank. By rally, what is meant is the slowdown in decline rates, he added. The decline in annual industrial output, capacity utilization, exports and other activity indicators still continues, he said.
"Considering decline rates, we see a slowdown compared to the previous month. There also is a rally in confidence and expectation indices. However, we believe in the need to monitor the indicators more to be sure that this is a permanent and robust rally. The developments in these indicators should be regularly monitored on a weekly and monthly basis."
Foreign investments in Turkey
Recently, there has been a noteworthy rally in portfolio investments, particularly toward stock and money markets, Çanakcı said, mentioning the interest in government securities. Noting that Turkey offers various options for foreigners in terms of investment opportunities, Çanakcı said, "Direct investment, stock investment, government bonds and private bonds ... compared to their equals, Turkish financial markets are very profound, with instrument diversity and significant freedom in inflow and outflow. Therefore, we do not think foreign investors face significant problems in finding instruments in line with their preferences."
Turkey drew $17.8 billion in foreign direct investment in 2008, when the impacts of the global crisis were immense, he said. "It is an economy with 65 percent foreign share in the stock market and 10 percent foreign share in government bonds." However, he added that there are still efforts to increase instrument diversity. The Treasury is forecasting foreign direct investment to be $10 billion this year, he said, but it may either reach the figure or remain below. Strong interest in borrowing instruments was seen in the latest eurobond issue, Çanakcı said. "We realized $1.5 billion euros worth of bond sales, and the demand was four to five times more than the issue. This proves that Turkey is regarded as a robust, credible economy."
Çanakcı said the aim was to increase relations with the Islamic Development Bank, which finances trade and investment in private and public sectors. "We could not benefit enough from the bank for project financing in the public sector. According to a study on project funding and the financing of public investments, which was completed in 2008, the bank will allocate resources worth $1 billion from 2008 to 2011. We made significant progress in this program," he said. Regarding the International Monetary Fund, Çanakcı said the global crisis revealed the need for an increase in the fund’s resources. "Moreover, resource utilization should be more flexible and rapid," he noted.
"Considering decline rates, we see a slowdown compared to the previous month. There also is a rally in confidence and expectation indices. However, we believe in the need to monitor the indicators more to be sure that this is a permanent and robust rally. The developments in these indicators should be regularly monitored on a weekly and monthly basis."
Foreign investments in Turkey
Recently, there has been a noteworthy rally in portfolio investments, particularly toward stock and money markets, Çanakcı said, mentioning the interest in government securities. Noting that Turkey offers various options for foreigners in terms of investment opportunities, Çanakcı said, "Direct investment, stock investment, government bonds and private bonds ... compared to their equals, Turkish financial markets are very profound, with instrument diversity and significant freedom in inflow and outflow. Therefore, we do not think foreign investors face significant problems in finding instruments in line with their preferences."
Turkey drew $17.8 billion in foreign direct investment in 2008, when the impacts of the global crisis were immense, he said. "It is an economy with 65 percent foreign share in the stock market and 10 percent foreign share in government bonds." However, he added that there are still efforts to increase instrument diversity. The Treasury is forecasting foreign direct investment to be $10 billion this year, he said, but it may either reach the figure or remain below. Strong interest in borrowing instruments was seen in the latest eurobond issue, Çanakcı said. "We realized $1.5 billion euros worth of bond sales, and the demand was four to five times more than the issue. This proves that Turkey is regarded as a robust, credible economy."
Çanakcı said the aim was to increase relations with the Islamic Development Bank, which finances trade and investment in private and public sectors. "We could not benefit enough from the bank for project financing in the public sector. According to a study on project funding and the financing of public investments, which was completed in 2008, the bank will allocate resources worth $1 billion from 2008 to 2011. We made significant progress in this program," he said. Regarding the International Monetary Fund, Çanakcı said the global crisis revealed the need for an increase in the fund’s resources. "Moreover, resource utilization should be more flexible and rapid," he noted.