Future growth in Turkey

[Squeaky]

Good evening:

The following appeared in Hurriyet today:

The European Bank for Reconstruction and Development, or EBRD, announced that this year Turkey is expected to be the fastest grower in Eastern Europe.

Updating its 2010 and 2011 expectations, EBRD now expects an average gross domestic product growth for Turkey of 4.7 percent, compared to the 3 percent it predicted in October. The increase rests upon expectations that foreign capital inflows will increase due to upgrades in Turkey’s credit rating.

Turkey will continue as the fastest grower in 2011 with 4 percent, according to EBRD. The bank also decreased the 2009 contraction estimate to 5.6 percent, from a previous 6 percent.

For full details please see: European bank raises Turkey’s growth estimate - Hurriyet Daily News and Economic Review

This is slightly different than expected from the posts seen on this forum lately decrying the efforts of the AK Party suggesting the government was about to completely ruin the country.

I say give credit where credit is due!!!

Cheers

Squeaky

 

[ChrisBobs]

oWell much credit is given
eg by national banks generously to certain corporations with certain in-laws on the board!!!!

The statistics of economic growth applies to certain parameters, but what seems to be the problem and criticism is that the bulldzer apporach to criticism
look at the prime minister saying at a public rally yesterday that media and unions are "agitators"
is he saying those who dare write / offer an opinion or go on strike for their rights -( eg Tekel workers) are against the state?
What about the 13% registered , and the rest unregistered unemployed..where is their growth?
Where is the support for start-up , small business ?
Only for big corporations..
and your article only refers to the flow of foreign capital as lifting the rate.. that is a fickle international phenomena - what does the country have to do with it?

 

[immac]

If you are used to following the financial pages of UK newspapers the contrast with Turkish (English Language) papers is stark. There are few investigative journalists and, as ChrisBobs suggests, little analysis to get behind "good news" stories; so the tourist industry is always booming, the housing market is always robust and the economy is fıt and healthy.
It makes decision making on financial issues very problematic.

Ian

 

[nomaderol]

Good post, ChrisBobs.
Plus, if European Banking had money, they could save Ireland, etc first before saving Turkey. This is a global crisis and world leaders including Erdogan played their parts in the crisis. Global crisis started at the end of 2008, but, I felt crisis in 2007 in Turkey before general elections in Turkey. But, Erdogan and his party had changed the topic from economy to the scarf, president election, etc.

 

[ChrisBobs]

A few more statistics that shows a worrying nosedive as far as per person 'growth' goes
(Hope this works- mmm not really )
Recent economic indicators: 2004 2005 2006 2007 2008(a) 2009(b)
GDP (US$bn) (current prices): 392.2 482.7 529.2 649.1 730.0 593.5
GDP PPP (US$bn) (c): 658.6 747.3 824.9 888.1 915.2 869.1
GDP per capita (US$): 5,862 7,108 7,767 9,422 10,479 8,427
GDP per capita PPP (US$) (c): 9,844 11,006 12,107 12,891 13,139 12,339
Real GDP growth (% change yoy): 9.4 8.4 6.9 4.7 0.9 -6.5
Current account balance (US$m): -14,431 -22,136 -31,893 -37,684 -41,289 -11,064
Current account balance (% GDP): -3.7 -4.6 -6.0 -5.8 -5.7 -1.9
Goods & services exports (% GDP): 23.3 21.8 22.5 22.2 24.1 22.9
Inflation (% change yoy): 8.6 8.2 9.6 8.8 10.4 6.2

Source: Australian Govt Fact sheet on Turkey

 

[Squeaky]

Good afternoon:

I have arrived at the point where I think some members of this forum will never see anything good on certain subjects and will find some reason to "shot down" anything positive that is posted.

For example the comments by ChrisBobs above oWell much credit is given
eg by national banks generously to certain corporations with certain in-laws on the board!!!!

I assume this is reference to my comment that credit should be given where credit is due. I assume I read the same English language papers as he and would really appreciate learning where he obtains information on which to base this comment. Does he really know the relationships of all board members in Turkey? If so does he really think that banks are being dictated to and ordered to support only certain companies who have family members of influential government officials on their boards. Or is this just a negative comment based his need to find something negative to say?

I would appreciate any reference that could be provided to backup this comment.

"The statistics of economic growth applies to certain parameters, but what seems to be the problem and criticism is that the bulldzer apporach to criticism look at the prime minister saying at a public rally yesterday that media and unions are "agitators"

I assume that the comment about "agitators" might stem from Erdogan's comments published in Hurriyet however the remarks I read stated: Erdoğan clearly challenges the military Sunday for the first time, as well as columnists who supposedly supported the military's plans, inviting them to reveal which side they were on. Please see Prime Minister ErdoÄŸan says his government ended civilian fascism in Turkey

I would suggest that this was a mild comment when one considers that there are indications that the military and a large number of journalists were/are formulating plans to overthrow the government. To suggest that there are not journalists who are anti-government and/or agitators against status quo is to hide one's head under the cover and refuse to see daylight.

"is he saying those who dare write / offer an opinion or go on strike for their rights -( eg Tekel workers) are against the state?"

Please see: Prime Minister ErdoÄŸan says his government ended civilian fascism in Turkey which states

Erdoğan also appealed to the workers from the state-owned alcohol and tobacco monopoly Tekel, who are currently staging a protest, telling them that it is the nation and not labor unions that bring parties to power and remove them from office, responding to the protestors’ claims that they can topple the government through their general strike.

The workers were dismissed from Tekel factories following their privatization, and vowed to go on a hunger strike if the government failed to respond to their demands. “Labor unions do not bring parties to power, the nation does; and it is the nation that removes a party from power. Nobody should see themselves as having the power to do this,” Erdoğan said.

While on the subject of TEKEL workers one should understand the background to this strike which is a strike by TEKEL workers who were fired after the business of privatized – that is to say by the company that purchased TEKEL. TEKEL is no longer "STATE OWNED". They were not fired by the government. In all probably the company found that there was a large number of workers who were “featherbedding” and unnecessary for efficient operation.

Please see: Please see Tekel demonstration reveals disagreement in Türk-İş
Having lost their jobs due to factory closures in the wake of the monopoly’s privatization, the employees started a protest in Ankara on Dec. 15, demanding that the government find positions for them with other state institutions or enterprises.

Regarding unemployment – yes the percentage is very high but any figures quoted do not reflect the true situation because of the size of the “black economy” in Turkey.

Where is the support for start-up , small business ?
Only for big corporations.

Please see: Loan support program starts up for Turkish SMEs - Hurriyet Daily News and Economic Review

The application period for a loan support program provided by Turkish Ministry of Industry and Trade will start Wednesday.
The new loan support program, worth 2.5 billion Turkish Liras for a total of 100,000 enterprises, is addressed to tradesmen, craftsmen as well as small- and medium-sized enterprises, or SMEs. The enterprises registered in the database of the Small and Medium Industry Development Organization, or KOSGEB, can apply to 17 banks within the scope of the program agreement starting Wednesday.

Just how much support for Small businesses does one expect? 2.5 billions TL seems like quite a lot to me.

and your article only refers to the flow of foreign capital as lifting the rate.. that is a fickle international phenomena - what does the country have to do with it?

The article I quoted above was not “MY ARTICLE” – it was a direct quote from the Hurriyet article reporting that The European Bank for Reconstruction and Development, or EBRD, announced that this year Turkey is expected to be the fastest grower in Eastern Europe.

Updating its 2010 and 2011 expectations, EBRD now expects an average gross domestic product growth for Turkey of 4.7 percent, compared to the 3 percent it predicted in October. The increase rests upon expectations that foreign capital inflows will increase due to upgrades in Turkey’s credit rating.

Please note that the expected increase in growth rests on the expectation that FDI will increase due to upgrades in Turkey’s credit rating. I would suggest that the performance of the government has a lot to do with the upgrades in Turkey’s credit rating which in turn leads to increased FDI. I don’t think one would be able to credit the opposition CHP or MHP parties for the upgrade in credit ratings. If they can't be given credit who the heck can? Possibly the government???? But then again, we can't have that can we????

Cheers

Squeaky

P.S. ChrisBobs lates post was posted while I was writing this post therefore not included.

 

[nomaderol]

GDP is a meaningless criteria to understand an economy. Because it is not about the distribution. For ex, if Sabanci's wealths were distributed to whole community, then, we could talk about GDP. Saudi Arabia has a good GDP, but, only their palace live comfortably while the rest is poor. What is important is living conditions. Take Turkmenistan. Their GDP maybe as low as 1000 usd, but, they dont pay any money for basical needs such as electricity, water, gas, hospital, etc. Their living conditions are better than any western European country and Turkey. Anyway. Distribution of wealth in Turkey is as bad as in USA or any European country with good GDPs and getting worse. Read world data even in western europe: 80% of capitals are owned by 5% of wealthiest population. Those GDPs, richness are not yours, but, those 5% only.

Edited to say: my this post was a reply to Chris (I didnt see Sneaky's post while I was posting.)

 

[Squeaky]

Good afternoon:

ChrisBob: Would appreciate a link to the source of the latest information published as it in almost unintelligible in the format posted.

Cheers

Squeaky

P.S.nomaderol - accept that it might look like I was being "Sneaky" to post while you were writing you post but I wasn't. My user name is Squeaky, not "sneaky".

 

[nomaderol]

The application period for a loan support program provided by Turkish Ministry of Industry and Trade will start Wednesday.
The new loan support program, worth 2.5 billion Turkish Liras for a total of 100,000 enterprises, is addressed to tradesmen, craftsmen as well as small- and medium-sized enterprises, or SMEs. The enterprises registered in the database of the Small and Medium Industry Development Organization, or KOSGEB, can apply to 17 banks within the scope of the program agreement starting Wednesday.

-------

KOSGEB? All those small and medium size companies have been in crisis. They are taking credits to pay their debts. They have bought manufacturing machines and they have much debt for them. But, where is the buyer? World stopped buying. If you dont have a buyer, it is meaningless to produce. Only field still alive is food sector.

 

[giglets]

Squeaky,

No doubt about it, this is good news for Turkey, considering that the UK economy appears to be sliding back by 0.2% this year.

However, the situation is more complicated than one set of figures on their own.

Unemployment, inflation and the housing sector all seem to paint a more gloomy picture, and it will be interesting to see by how much the "real" cost of living increases this year.

As usual, take your pick from a wide selection of statistics - and you know what is said about statistics!!



Dave

 

[ChrisBobs]

Good afternoon:

ChrisBob: Would appreciate a link to the source of the latest information published as it in almost unintelligible in the format posted.

Cheers

Squeaky

P.S.nomaderol - accept that it might look like I was being "Sneaky" to post while you were writing you post but I wasn't. My user name is Squeaky, not "sneaky".

Hello Squeaky
just came back to the discussion,

Here is one requested link
http://www.dfat.gov.au/geo/fs/turk.pdf
and another as an example
TURKISH BANKS MAKE HUGE LOANS TO FRIEND OF ERDOGAN - The Jamestown Foundation

I would hope that I am not a habitual ' negative commentator' and appreciate your well researched essay in response

however politics and power offer a field day for opposing quotes and response- as you and Erol see!

The pros and cons of the Tekel strike ( and in principal I don't disagree with privatization in Turkey even though it is a tough job) are not my argument-
I am concerned that it is an example of a fairly common theme by politicians in power ( and not just in Turkey) to not answer the argument but to rubbish the people making the opposing argument, to denigrate them as if to say they have no right to say anything.
In the confusion and cross-fire of Ergenekon and now the latest version Sledgehammer - yes there are some journalists involved deeeply,
BUT there are also journalists reporting and commenting ( their job) on all sides, because different media have different policies and so do people.

There has been some recent belated support for SME's that you quote, but as NomadErol says - there are few sectors where established SME's are even holding their heads above water , and that is who it is aimed at, ...start-ups?

But the real point I have to come back to - am I being negative to one example of positive spin on the Turkish economy.
No!
Just not sure why we are exorted to give credit and where the credit is due !
So I rose to the bait!
Well done!
Back to the sources!
:kitapoku::slapme:

 

[botchy123]

Hi,

Observed the posts above and appreciate all the views.

From a person on the ground i have noticed the following.

A majority of UK residents complaining about price increases.

The increase in essential items-

ie.Bread,gas,petrol,electric,cigarettes,beer,residents permits and meat.

Over the last few months some of these have risen by 40%.So the "well off "retired UK citizen is complaining about prices can you imagine the average "Turkish family".

Inflation and falling interest rates at the moment are the biggest problem for Turkey over the next 2 years,and if it does not improve then i fear the worst for this economy.

Just my view

 

[nomaderol]

Squeaky, sorry for typo error for your nick, it wasnt intentional.

Anyway, I consider such media news as "pumping hopes" for economy recovery. But, reality is not so, pumping hopes wont work. I for one in the business/manufacturing field knowing tousands of manufacturing companies who are members of KOSGEB am not optimistic at all. I also know international business well as I am in this field. Most of international businesses nowadays are only UN tenders. Turkey's manufacturing industry is not independent of world business. Europe and USA stopped orders to KOSGEB companies as business is not good there in those countries either. Giving loans to KOSGEB companies will mean nothing, but, paying their debts to the banks which is the only sector now in Turkey that havent lost money. Isn't it strange that they are only the banks in Turkey are still making good profits. Think that AKP is an islamic party and making money from interest rate is haram. Someones have been fooled, I think.

 

[Squeaky]

Good afternoon Giglets:

I thought at the time I wrote my original post that I was posting something that members would welcome as good news considering how much there is in the way of "bad news" concerning Turkey posted from time to time and was very surprised to find that it was not welcomed but seems to have been seen as an opportunity to slag off the government with a mish mash of unsupported comments.

It was for this reason that I took the time to post such a long rebuttal supported by links to my sources.

Yes, I understand that there are "lies and damned lies" but I hope good things will happen in Turkey and welcome the many revelations that are appearing about "the good old days".

Cheers

Squeaky

nomaderol: Only joking about the name but you and I are going to have to arrange a schedule because we both seem to be preparing posts at the same time.

I generally agree with your view about the economy but will do some research into the use of the word "Islamist" government and get back later. I understand about the business about not charging interest but don't quite understand what the government should do about it. Surely they couldn't pass laws to forbid it. I wonder if the government is actually in any businesses that charges interest. In any case I imagine that the cats would surely be among the pigeons if the government were to pass laws to stop interest payments. Wow, that would really create some noise about Turkey becoming like the Iranian style government. Does Iranian banks etc charge interest?

A whole new subject to think about!!!!

Cheers

Squeaky

 

[Squeaky]

Good afternoon:

Have had some problems today keeping up with the posts - I clicked on this subject and found a post from Giglets which I tried to answer and while posting that found one from Nomaderol had slipped in and after posting a post script found two from Botchy123 and ChrisBob were above his. Might have been something to do with opening a page on a tab that was open but will try to make sure I have the very latest post in future before posting a reply.

ChrisBob: Thanks for your reply. When I noticed that one of your sources was the The Jamestown Foundation I immediately suspected that it was something from Gareth Jenkins and for once was correct. I have read a number of his articles which are very negative towards the Ak Party and seen another by someone which dissected one of his blogs and literally tore it apart pointing out how he had phrased his comments in a way to create a negative impression when they could just as well been more positive. Think this is now referred to as "Spin Doctoring".

I don't doubt that there is "hanky panky" going on with AK Party supporters - that would simply be too much to ask from any politician but hope that there is less now than there was in the past. In any case I think all this business about coup plots etc can only be good for Turkey and it's citizens. Frankly is even a small bit of it is true I find it scary. Maybe I am naive but I have always trusted the military and police and if there were illegal acts blamed it on the individual, not the system and upper authorities.

I wish I could find out more about this man and his background because I believe he is a former employee of the Dogan Media Group as his articles take a very similar line as many of the DGM journalists. I suspect that his name would have been on the "pro coup" list of the Sledgehammer coup paper.

Cheers

Squeaky

 

[giglets]

Good afternoon Giglets:

I thought at the time I wrote my original post that I was posting something that members would welcome as good news considering how much there is in the way of "bad news" concerning Turkey posted from time to time and was very surprised to find that it was not welcomed but seems to have been seen as an opportunity to slag off the government with a mish mash of unsupported comments.

It was for this reason that I took the time to post such a long rebuttal supported by links to my sources.

Yes, I understand that there are "lies and damned lies" but I hope good things will happen in Turkey and welcome the many revelations that are appearing about "the good old days".

Cheers

Squeaky


Squeaky,

I started my reply with an agreement that the Turkish economy would grow a hell of a lot more than the UK's - indeed, Good News!

I then, merely pointed out the obvious - growing unemployment, large quantity of unsold housing stock, which will, inevitably, hold back the general market and restrict capital growth, rising inflation which will definitely impact on the spending power of most families, as wages will not keep up with prices.

Is there anything mentioned which you think is either exaggerated or untrue?



Dave

 

[nomaderol]

I understand about the business about not charging interest but don't quite understand what the government should do about it. Surely they couldn't pass laws to forbid it. I wonder if the government is actually in any businesses that charges interest. In any case I imagine that the cats would surely be among the pigeons if the government were to pass laws to stop interest payments. Wow, that would really create some noise about Turkey becoming like the Iranian style government.

No, squeaky, not like that. AKP's main economy application, since they are in charge, has been on interest rates. They have done nothing for real sectors, i.e. for manufacturing sectors. Banks have benefited much from this government. Laws have protected banks more than any other business sector. Some can say this was due to 2001 local Turkey crisis in that some banks had gone banktrupcy. But, AKP gone further, protected banks by laws much more than any sector, therefore, they are the only banks making profit during this global crisis now. AKP's economy has been virtual as it has been based on interest only. Banks are doing belly dance in Turkey. But, their these happy days too will pass. I am hearing that unpaid credit cards increased double, unreturned loans doubled, etc. Erdogan had said "global crisis past us tangentially", all AKP supporters clapped his this word considering a success. But, their former economy minister walked in an istanbul bazaar some months ago and confessed that they were not aware of things out of Ankara as they were happily putting their salary 15000 lira per month in their pockets. AKP really not aware of real sector that is in coma. Turkey havent felt crisis much as it is also an agricultural industry country, compensated the loss in other industries. But, I am not expecting a good crop this year as the weather isnt going well for crops (late winter, etc). If this happens, see their yells of rural people who voted for AKP. Actually, they started to voice their disappointments last year. AKP didnt give good bottom prices for many agricultural products. They can't. They dont have money. They are pleaing IMF, but, if IMF had money, they could help Iceland, Ireland, USA, etc.

 

[Robert]

I started a thread a while ago called INTEREST--ING RATES.
I argued that Turkish interest rates would rise during 2010, and asked for members views. Most people took the oposite view, some even sugesting further falls in rates.
I felt that the Turkish ecomomy was in a far better position to weather the finacial storm because its banking system . I still think the same, Turkey will get through this crisis faster and in a much stronger position that most countries.
and I still think that rates will be higher at the end of the year than now.
Advance Turkey!!!!!!!!!!!!
SENI SEVIYOURUM:first:

 

[nomaderol]

Robert, like many expats, you too probably living on interest rates. But, sorry, people are unable to pay their debts (credit cards, loans, etc) to the banks and the banks will be in trouble sooner or later. Hope this happens and you withdraw your moneys and play with me, in real business. (lol)

 

[Robert]

robert, like many expats, you too probably living on interest rates. But, sorry, people are unable to pay their debts (credit cards, loans, etc) to the banks and the banks will be in trouble sooner or later. Hope this happens and you withdraw your moneys and play with me, in real business. (lol)

thou asumeth too much!!