Turkish Forum

Tag: Economic Crisis

  • Turkey’s COLLAPSE Is FAR Worse Than You Think

    Turkey’s COLLAPSE Is FAR Worse Than You Think

    Turkey’s COLLAPSE Is FAR Worse Than You Think, HyperInflation, Bankrupt

    The declining value of the Turkish lira, especially during the 2018–2022 Turkish currency and debt crisis, had a significant impact on the recent decrease in the country’s USD-based nominal GDP figures. High inflation continues to be a problem in the early 2020s. According to the IMF’s estimates, published in the IMF WEO Database of October 2022, Turkey is forecasted to have the world’s 20th-largest nominal GDP and 11th-largest GDP by PPP by the end of 2022.

  • Two Countries, Turkey and Venezuela, Are Candidates for a Crisis

    Two Countries, Turkey and Venezuela, Are Candidates for a Crisis

    With the bloom coming off the emerging markets rose, one economic model has drawn a circle around two countries that stand the greatest risk of falling into a crisis.

    Chlaus Lotscher | Photolibrary | Getty Images

    David Rees, emerging markets economist at Capital Economics, said the firm has developed five criteria to identify whether a country’s economy has overheated to the point where it is threatening to develop into a full-scale problem.

    The good news is that the Capital model finds no country in “immediate threat of crisis.”

    But the bad news is that at least two countries are tilting in that direction and could pose danger to investors.

    Rees identifies the endangered duo as Turkey and Venezuela.

    (Read More: Tesco Quits US as Profits Fall for First Time in 20 years)

    Turkey’s stock market has surged 7.3 percent in 2013 and is up 42 percent over the past 12 months. The country outperformed virtually all other emerging markets in 2012 as it modernizes its economy and pushes pro-growth programs.

    Venezuela’s markets tell an even more robust story, with the Caracas exchange booming 37 percent this year and more than 200 percent over the past 12 months. While some feared the rally might falter due to political upheaval after President Hugo Chavez’s death, the market has gone on its merry way.

    Despite the powerful gains, Rees advises investors to watch five factors: Growing current account deficits; rapid credit expansion; surging short-term external debt; bubbling stock market prices (50 percent is considered a red flag); and large growth in real exchange rates.

    Broadly speaking, capital inflows “are something of a double-edged sword” for developing economies, Rees said. They both can help spur development but also “can fuel overheated economic growth and asset price bubbles,” he added.

    “In extreme cases, capital flight can then lead to recession and sharp falls in asset prices that can culminate in defaults on debt repayments,” Rees said in an analysis.

    The warning comes as emerging markets take a break after a decade of strong growth.

    Overall, emerging market stocks are down for the year, with the iShares MSCI Emerging Markets exchange-traded fund off more than 7 percent. Investors have pulled more than $2 billion from the ETF, the third-most of any of its peers, according to IndexUniverse.

    Still, some strategists remain positive on the group, reasoning that the underlying indicators remain strong even if sentiment has shifted due to negative headlines in the high-profile BRIC nations – Brazil, Russia, India and China.

    (Read More: By 2015, Producing in China Will Be as Costly as US)

    “In general, we see good long-term value in emerging markets based on favorable economic fundamentals,” Wells Fargo said in a recent analysis. “Valuations for emerging markets overall and for the larger markets are some of the cheapest in the world.”

    Investors should keep watch, then, on where the real opportunities — and crises — present themselves.

    “There is a risk that a prolonged period of loose monetary policy in the developed world could push large flows of capital into EMs over the coming years,” Rees said. “Accordingly, it would be useful to know if, and when, a crisis is about to unfold.”

  • Use of antidepressants ‘is soaring’

    Use of antidepressants ‘is soaring’

    Press Association

    Prescriptions for drugs such as antidepressants and sleeping pills have jumped 20% in just three years, according to new figures.

    Experts believe the stress of recent years, including that caused by economic turmoil, means more people are experiencing mental health problems.

    Data from the NHS Information Centre shows antidepressant use alone rose 28% between 2007/08 and 2010/11 in England. Just under 34 million prescriptions were dispensed for antidepressants in 2007/08, rising to 43.4 million in 2010/11. The use of anti-anxiety drugs rose from just over six million to 6.5 million in the same period (an 8% jump), while prescriptions for sleeping pills rose 3% from around 9.9 million to 10.2 million.

    Meanwhile, prescriptions for barbiturates, which promote sleep and reduce anxiety, have dropped 51% from just over 22,000 to just under 11,000. Across all these groups of drugs, there was a 20% rise in prescription items dispensed between 2007/08 and 2010/11.

    The cost of the drugs to the NHS fell by 9% in the same period, from £329.9 million to £301.6 million. Antidepressants alone cost the NHS £264.5 million in 2007/08 and just under £235.4 million in 2010/11.

    Paul Farmer, chief executive of the mental health charity Mind, said there were several factors that could lead to increased prescription figures. “The tough economic times may have contributed to more people experiencing depression but improved awareness around mental health problems may also mean more people are seeking help for their problems, with doctors also getting better at spotting symptoms,” he said.

    “It’s important to remember that antidepressants can be a lifeline for some people which enable them to manage their mental health problems. It is worrying that antidepressants can be the first port of call for some doctors, despite the fact that ‘watchful waiting’ and talking therapies are recommended as the first line of treatment for mild to moderate depression.”

    Mr Farmer said there was a a lack of access to talking treatments, such as counselling, in some parts of the country “which means doctors are left with little choice but to prescribe medication”. He added: “Last year Mind found that one in five people still have to wait over a year to access talking therapies.”

    Depression is costing the country almost £11 billion a year in lost earnings, demands on the health service and in prescribing drugs to tackle the problem, according to The Independent. Research by the House of Commons found the cost to the NHS of treating the illness is put at more than £520 million a year. This figure is made up of £237 million for hospital care, £230 million for antidepressant drugs, £46 million for doctors’ time and £9 million for outpatients’ appointments.

    It also said that people who are unable to work because of the illness lose £8.97 billion of potential earnings a year, while the loss of earnings from people who commit suicide is estimated to be a further £1.47 billion.

    Copyright (c) Press Association Ltd. 2011, All Rights Reserved.

    www.guardian.co.uk, December 30 2011

  • Turks Enjoy A Little Schadenfreude At EU’s Expense

    Turks Enjoy A Little Schadenfreude At EU’s Expense

    Turks Enjoy A Little Schadenfreude At EU’s Expense

    by Peter Kenyon

    507469746 9669823

    Bulent Kilic/AFP/Getty Images

    A woman walks up the stairs of Galata Bridge in Istanbul. With the financial crisis in the eurozone, Turks are rethinking their years-long bid to be a part of the European Union.

    As he prepares for the midday rush, Mustafa Baljan puts the finishing touches on the kebabs, salads and stews that make up many a working Turk’s lunch. As the steam carries the scent of lamb and garlic into the street, the 37-year-old restaurant owner considers a popular question: With European economies on the ropes, should Turkey still be seeking to join the European Union?

    “Are you kidding? Of course I don’t want to join,” Baljan says. “Countries are going bankrupt. Why would we want to join a union like that?”

    After years of seeing their bid to join the EU stalled, Turks are trying not to show too much pleasure these days at the doom-laden economic news emanating from Europe. The Turkish economy is healthy enough that some Turks joke that perhaps the EU should join Turkey instead. However, economists are warning that Europe’s debt crisis could easily spill in Turkey’s direction.

    A Lack Of Sympathy For Greece

    Having been snubbed from Brussels to Barcelona, Turks may well be looking at their own GDP perking right along and smiling behind their mustaches at the economic ash clouds hovering over various corners of Europe.

    Take Greece, for instance. You might say that Turkey and Greece have a robustly competitive relationship. You might also say the Hatfields had a few reservations about the McCoys. As a retired U.S. diplomat once observed, Greece and Turkey are the only NATO allies whose national days celebrate victory over each other.

    For many Turks, Greece’s entry into the eurozone in 2000, while Turkey’s own EU bid languished, was a slap that carried an especially bitter sting.

    So while Greeks today writhe under the weight of painful austerity measures and some European analysts snarl that maybe Greece never really belonged in the club anyway, the immediate reaction of Turks is not one of neighborly sympathy.

    “I think Greece deserves that!” marketing specialist Harika Eren says. “Yes, I’m sorry, I’m not racist, but Greece deserves that!”

    Not Immune

    Analysts say Turks would do well to stifle the schadenfreude, however, because the EU remains Turkey’s largest and most important trading partner. That’s why economist Daron Acemoglu at the Massachusetts Institute of Technology says the eurozone debt crisis is a “ticking time bomb” for Turkey.

    “The situation for Turkey is critical at some level, because Turkey is in the midst of a very large current account deficit,” he says. “It’s already brought its interest rates down, so it doesn’t have much room [to] maneuver if things start going bad.”

    At some level, many Turks do realize that in today’s world, economic pain can spread just as fast as gain. For the moment, though, they don’t mind taking a page from the British and thinking, “Well, glad we didn’t join that club!”

    via Turks Enjoy A Little Schadenfreude At EU’s Expense : NPR.

  • Turkey’s “Economic Recovery” Raises Questions

    Turkey’s “Economic Recovery” Raises Questions

    Turkey’s “Economic Recovery” Raises Questions

    Publication: Eurasia Daily Monitor Volume: 7 Issue: 150

    August 4, 2010

    By Saban Kardas

    The Turkish Exporters’ Assembly (TIM) announced statistics on Turkish export figures in July 2010. Turkey exported around $9.5 billion in goods, which amounted to a 5.97 percent increase since July 2009. Between January and July 2010, its exports increased by 13.14 percent compared to the same period last year and reached $64.2 billion. Turkey’s leading export industries were in the automotive, textiles and chemicals sectors (www.tim.org.tr, August 1).

    The export trends are an important indicator in order to understand the Turkish government’s handling of the economy in the face of the global economic crisis. After coming to power in 2002, the governing Justice and Development Party (AKP) managed to stabilize the Turkish economy, which had suffered from a series of home-grown financial crises throughout the 1990’s and early 2000’s. The Turkish economy reported record growth rates under the AKP’s rule, with Turkish exports surpassing the important psychological threshold of $100 billion.

    However, the global financial crisis shattered this optimistic picture. Under pressure from a contracting global economy and weak domestic demand, Turkey’s production sector was badly hit, resulting in a hike in unemployment figures. With the lessons learned from earlier financial crises, however, Turkish financial institutions weathered the storm successfully. Ankara did not experience the collapse of the mortgage system or a credit crunch, and the Turkish banking sector grew even in those difficult conditions.

    Nonetheless, the Turkish government came under criticism for its economic policies. For skeptics, the government could not take effective measures to protect the economy, especially through its refusal to accept international assistance (EDM, April 2, 2009). Some Turkish business groups pressured the government to conclude a stand-by agreement with the International Monetary Fund (IMF) so that it could serve as an anchor of stability and attract fresh loans to non-financial sectors. Others argued that Turkey could overcome financing problems independently without the IMF’s help. After many rounds of talks, Prime Minister, Recep Tayyip Erdogan, refused to sign a loan deal with the IMF, on the grounds that it would reduce Turkey’s flexibility to initiate appropriate measures. Instead, Erdogan’s government launched various stimulus packages to boost domestic demand and initiated a medium-term economic recovery plan (EDM, September 23, 2009).

    The government’s efforts helped revitalize industrial production, easing the effects of the crisis. For a healthy recovery, however, it was necessary to expand Turkey’s export volume, given the limitations of its domestic market to sustain industrial growth alone. The trends in exports are thus a key indicator to understand the fate of Turkey’s crisis recovery policies.

    Supporters of the government’s economic policy have referred to the country’s ability to avoid a major economic breakdown without outside help and the signs of recovery in recent months. In their view, through its successful road map, Turkey proved its self-sufficiency and resilience to crises, and that it could sustain this momentum without the injection of foreign capital through an IMF deal (Today’s Zaman, March 11).

    Thus, Turkish government officials welcomed the recently announced export figures as further evidence that Turkey was emerging from recession. In a written statement, Turkish State Minister, Zafer Caglayan, responsible for foreign trade, interpreted these developments as signs that Turkish export levels were on the path to recovery. He analyzed the trends in exports and argued that the government will be able to reach the export volume predictions of the medium-term economic plan (www.ntvmsnbc.com, August 1).

    Nonetheless, Turkish economists call for caution in evaluating Turkey’s performance in coming out of recession. For instance, a leading Turkish economist, Guven Sak, based on the results of a study conducted by the Economic Policy Research Foundation of Turkey (TEPAV), identifies a worrying pattern. He argues that although the export volume in the global economy expanded in the first quarter of 2010, Turkish exports remained rather stagnant. He reached the conclusion that while the global economy is rapidly returning to pre-crisis levels, Turkey is having difficulty catching up with these wider trends; Turkey was able to recover only 75 percent of the export volume lost due to the crisis. Thus, he called for a more effective export promotion strategy (Referans, July 29, www.tepav.org, July 28).

    Indeed, reaching new markets has been a key component of the government’s recent foreign economic strategy. Caglayan and other Turkish officials have traveled extensively in order to boost Turkey’s foreign trade. For instance, Caglayan was in the US recently. Traditionally, Turkish exports to the US remained limited compared to its trade ties with the EU and Turkey now seeks to gain a larger share of the US market. Similarly, Turkey wants to form a free trade zone in the Middle East to include Turkey, Syria, Lebanon and Jordan, hoping that it might improve Turkish trade with the region. A meeting in Istanbul brought together the representatives of these countries last weekend, where they agreed further steps towards realization of this objective (Anadolu Ajansi, July 31).

    The need for a more effective export-oriented growth strategy, in addition to penetrating into new markets, is also recognized by the government. In a recent meeting aimed at formulating a road map for Turkish exports, bringing together representatives from the treasury, central bank and other state institutions, Caglayan stressed that industrial products still accounts for nearly 80 percent of the country’s exports. The meeting concluded that Turkey had to reduce its dependence on the export of low and medium-technology products and move to more profitable sectors. Also, the meeting highlighted Turkey’s heavy reliance on foreign energy sources as a liability affecting its foreign trade balance (Anadolu Ajansi, July 12).

    This last point highlights another major challenge facing Turkey’s economic recovery: dependence upon imports to sustain its economic growth. Parallel to the increase in domestic production and exports, Turkish imports also soared in recent months. The foreign trade deficit, which had been a prime source of concern for the Turkish economy, contracted sharply during the global financial crisis. Figures released recently show that as of June 2010 the foreign trade deficit increased by 34.9 percent since last year and Turkey’s exports are far from meeting its imports (www.tuik.gov.tr, July 30).

    https://jamestown.org/program/turkeys-economic-recovery-raises-questions/

  • Hillary Clinton: “The ball is in Turkey’s field”

    Hillary Clinton: “The ball is in Turkey’s field”

    Democrats are in serious trouble. They need every vote they can get in November so that is why they are posturing around.
    I would like to see the day when Turkey can care less and shrug off  the American and Armenian clamors, resolutions etc  about this farce of genocide.
    Turkey and Azerbaijan should unite more and defy this idiotic nonsense..
    Almost 80 million Turks being manipulated by a 2 million weakling nation and its masters in Washington…Disgusting….

    .. Oya Bain [oyabain@gmail.com]

    ———————————————————————————————————————————————————

    Armenia’s April decision was impressive and praiseworthy. U.S. Secretary of State Hillary Clinton declared at a joint press conference with Armenian Foreign Minister Edward Nalbandyan today in Yerevan, when speaking about Armenian side’s decision to suspend the process of ratification of the Armenia-Turkey Protocols.

    Speaking about the Armenian-Turkish normalization process Hillary Clinton reminded that she personally attended the ceremony of signing the Protocols. “It was a brave decision by the two Presidents aimed at complete normalization of relations,” Secretary of State mentioned meanwhile expressing concern over their non-fulfillment.

    “You know that the signed documents have not been fulfilled yet, and there are some problems. I am happy that irrespective of the difficulties coming, certainly, from Turkey, Armenia is ready to continue the process,” Hillary Clinton declared. She mentioned that under the circumstances Armenia’s decision was impressive and praiseworthy, and they appreciate Armenia’s readiness to continue the process.

    Using football terminology Secretary of State concluded: “The ball is now in Turkey’s field.” She also added that the American side also encourages Turkey to undertake some steps.

    Source: Panor

    ===============================================================================

    Clinton: The Ball is in Turkey’s Field

    Monday, 05 July 2010 16:20

    Armenia’s April decision was impressive and praiseworthy, US Secretary of State Hillary Clinton declared at a joint press conference with Armenian Foreign Minister Edward Nalbandian in Yerevan, when speaking about Armenian side’s decision to suspend the process of ratification of the Armenia-Turkey Protocols.

    Speaking about the Armenian-Turkish normalization process Hillary Clinton reminded that she personally attended the ceremony of signing the Protocols. “It was a brave decision by the two Presidents aimed at complete normalization of relations,” Secretary of State mentioned meanwhile expressing concern over their non-fulfillment.

    “You know that the signed documents have not been fulfilled yet, and there are some problems. I am happy that irrespective of the difficulties coming, certainly, from Turkey, Armenia is ready to continue the process,” Hillary Clinton declared. She mentioned that under the circumstances Armenia’s decision was impressive and praiseworthy, and they appreciate Armenia’s readiness to continue the process.

    Using football terminology Secretary of State concluded: “The ball is now in Turkey’s field.” She also added that the American side also encourages Turkey to undertake some steps.

    US Secretary of State Hillary Clinton said that the US believes that the Armenian-Turkish normalization will bring peace, stability and prosperity to the region. The steps taken to this end will contribute to the normalization of relations between the two states, said Hillary Clinton during a joint briefing with Armenian Foreign Minister Edward Nalbandian in Yerevan.

    “Though the Protocols have not been ratified yet, but President Sargsyan stated that Armenia is ready to continue talks with Turkey as soon as it makes a step forward, and we hail this statement. The US agrees with this point of view, and we estimate positively the Armenian leadership’s statement,” stressed Clinton.

    For his part, Edward Nalbandian noted that Armenia is ready for a dialogue with Turkey without preconditions as soon as Ankara is ready for it.

    ‘Despite the fact that Turks were, and remain unready to establish relations with Armenia without preconditions, it is very important for us to feel the attitude of the US administration on the matter,’ RA President Serzh Sargsyan said during the meeting with Secretary of State Hillary Clinton.  He also expressed gratitude to President Barack Obama and the Secretary of State for their attempts to normalize Armenian-Turkish relations.

    In her turn, Hillary Clinton thanked the Armenian leader for his personal contribution to the improvement of relations with Turkey.

    News.am, PanARMENIAN.Net,  Panorama.am