IFR Turkey Special Report 2015

At a crossroads: To say that Turkey is at a crossroads and must choose its future direction is simply to state an age-old truth: it always has been. Geographically, Turkey is at the crossroads of Europe and Asia, an ornate doorway between two regions. The EU’s endless debates over the merits of letting it join have only emphasised its unique location – while fuelling its frustration.

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Stories in Special Report

Unready! Unsteady! Go?

Turkey is failing to make the most of lower oil prices. With growth slowing, inflation rising and unemployment making a comeback, investors are beginning to fret.

Fitfully fragile

Better co-operation and co-ordination between the Turkish government and the central bank would be a good place to start for the country to find a better level of economic stability.

All the world’s a stage

The AKP’s march towards what looks like a fourth successive election victory has fed fears that Turkey is becoming increasingly authoritarian. But while it is increasingly inclined to look elsewhere for its political inspiration and partnerships, its relationship with Europe continues to define its economic success.

Shifting equilibrium

Investors flocked to Turkish assets in the second half of last year, seeing the country as a direct proxy for Russia minus the sanctions. Yet they’re departing now in droves, worried by a troubled economy, a rudderless government and yet more political uncertainty.

Ironic appeal

Strong fundamentals and a favourable regulatory environment have attracted an influx of foreign investment in Turkey’s banking sector, but opinion is split on whether a slowdown in growth will dampen investor appetite.

Beyond willpower

Islamic finance is slowly becoming a force in Turkey – but it needs more supply to match the clearly rising demand. Elsewhere, we’re seeing a host of products rise in popularity, from CoCos to project finance to SME covered bonds.

Learning to gaze inwards

Turkey’s local currency debt markets only started to develop about five years ago before issuance started to take off in 2012. As with many new markets it has faced considerable challenges in its early years, not least persistent inflation and high rates, but bankers hope a maturing pension fund industry will increase interest in the sector.

Flying high, feeling down

After new legislation in 2013 to make PPPs more attractive to foreign investors, Turkey has seen European banks pile into its infrastructure projects.

Caravan at the crossroads

Political risk in Turkey is rising up the agenda of investors as elections approach and the president grows more autocratic.

Caught in a trap

The IMF is among bodies that have warned that Turkey could languish in a “middle-income trap” unless it reforms key sectors such as the labour market.

Special Report

Special Report

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