World Bank praises Turkey for ‘steps in right direction’
A World Bank official this week praised Turkey’s recent economic policies as “steps in the right direction,” signaling a potential turnaround in a five-year economic crisis that saw historic lows for the Turkish lira, accompanied by record high inflation.
There is now hope for progress, following decisions by Central Bank Governor Hafize Gaye Erkan to raise interest rates to combat inflation and increase taxes to close the budget deficit.
“We believe that the monetary policy tightening … , the unwinding of distortive financial regulations and the fiscal revenue measures to curtail the fiscal deficit being pursued by the Ministry of Finance are steps in the right direction,” said Humberto Lopez, World Bank country director for Turkey.
Inflation remains high at 58.9%, and the tax hikes disproportionately hit the poor, as Adam Lucente reports, but there are signs of a path to recovery.
“While recent economic indicators show a mixed picture, Turkish assets have displayed strong performance, signaling renewed investor confidence,” writes Piero Cingari for Al-Monitor Pro.
Meanwhile, the news was less promising on Turkish accession to the European Union. EU Commissioner for Neighborhood and Enlargement Oliver Varhelyi, in a visit to Ankara this week, said that Turkey must implement democratic reforms to revive its stalled membership bid to join the bloc, as Ezgi Akin reports.
Turkish President Recep Tayyip Erdogan has linked his country’s EU membership negotiations to approving Sweden’s accession to NATO .
Source : Al-Monitor