The downturn has not been comfortable for Turkey. Exports are collapsing. Unemployment is high, at around 15%, and rising. Youth unemployment, at around 25%, is particularly worrying, undermining one of the macro economic factors Turkey has going for it – its young population. It is in the process of negotiating an IMF loan, a stark reminder of its economic problems. And it has an illustrious history of economic problems morphing into political ones. Yet optimists can look at the situation through a different set of indicators, revealing a more...Read more
To purchase printed copies or a PDF of this report, please email leonie.welss@lseg.com and shahid.hamid@lseg.com
Turkey has long been in negotiations with the IMF for a loan that will take the pressure off its public finances and give it more options in dealing with the global downturn. But failure to reach an agreement before now has led many to conclude that the government does not really want a loan, or is unwilling to accept the conditions that would be attached to it. But does it have any choice? Solomon Teague reports.
A skillful and opportunistic borrower, Turkey has always been clever at spotting the right time to come to market to achieve its financing requirements. But as investors look to cut back their emerging market exposures to minimal levels, the sovereigns gain could be the loss of other Turkish asset classes. Savita Iyer-Ahrestani reports.
Corporate bonds have never been a major feature of the Turkish financial landscape, but some are predicting it could rear its head in the second half of the year and beyond, filling the vacuum left by the shriveling loan markets. But the path to fruition for this new market will not be smooth: risk adverse investors are more inclined to stick with what they know at times of high uncertainty. Savita Iyer-Ahrestani reports.
Amid a crisis that is global in nature, there is only so much that can be done to insulate your own national market. But Turkey’s banks could barely have done more to ensure the loan market remains open to its corporates. And the banks also look well placed to secure at least a proportion of their own needs from their foreign counterparts. Solomon Teague reports.
There is no denying the last 12 months have been a rough ride for the Turkish equity market. Look a little closer, however, and the omens are pretty good: although there has been a downward trend, at least the market has remained orderly, while the continued presence of many foreign investors shows a long term commitment to the country that will stand it in good stead. Solomon Teague reports.
Turkey has a long history of rampant inflation and aggressive currency movements. The vulnerability of the lira was at the root of the Turkish financial crisis of 2001, after an unsustainable build-up in public debt, exacerbated by a negligible export industry and political turmoil. But now the lira, like so many other aspects of Turkey’s financial markets, shows signs of having come of age. Solomon Teague reports.
The financial crisis may have severely impacted the emerging Turkish securitisation market but a trickle of deals is still coming through. Market participants, meanwhile, are hopeful that relatively strong fundamentals will help the market recover. By John Ferry
A Diversified Payment Right is the right of an onshore bank to receive payments from an offshore bank because a payment order has been initiated by a person, company or institution situated offshore in favour of a person or entity situated onshore. For example, the payment order could be initiated by overseas workers sending money back to their families in the local jurisdiction, or it could be payment by an importer situated offshore for goods or services provided by an exporting company in a local jurisdiction. Payment orders can either...
Regulation, once an unfortunate afterthought, has become a topic for debate at dinner tables around the world. Light touch regulation has fallen out of favour and looks set to be replaced by a more intrusive, tougher form of oversight – of which the Capital Markets Board of Turkey has long been a proponent. What does Turkey’s regulator have to teach the rest of the world? Solomon Teague finds out.