Post-Referendum Turkey Sees Sharp Drop in Inflation, Unemployment By Year-End

Published May 4th, 2017 - 05:00 GMT
Turkey predicts a drop in the country's inflation rate and unemployment by end-2017. (File photo)
Turkey predicts a drop in the country's inflation rate and unemployment by end-2017. (File photo)

Turkey will see a single-digit inflation rate by the end of 2017, Deputy Prime Minister Nurettin Canikli predicted on Wednesday. 

Turkey's annual inflation rate increased in April, the Turkish Statistical Institute (TurkStat) reported on May 3, 2017. Consumer prices in Turkey rose 11.87 percent year-on-year in April from 11.29 percent in March, TurkStat said.

Read more: Turkey's Inflation Rate Still Stuck In Double-Digit Territory

“We will see this [drop] not only in inflation but also in unemployment at the end of the year,” Canikli told journalists in London where he was holding a series of meetings.

Stating he had met investors and those interested in doing business in Turkey, Canikli said direct investment had gathered pace in recent years.

Turkey, which failed to attract an average direct investment of $1 billion before 2002, has become a country which attracted $12 billion as of the end of 2016.

He also said direct investment, which had reached $22 billion in some years, naturally fell in recent times due to geopolitical and regional risks but insisted Turkey was still a country with great potential to attract business.

The deputy prime minister said developments in Turkey and in the region could be presented differently to foreign markets. He said direct contact was being made with investors to inform them of the situation in Turkey.

Speaking about Turkey’s new presidential system, Canikli said markets had welcomed the continuity of stability.

“The rising value of the Turkish lira and the historic records seen in Borsa Istanbul are the indicators showing that the presidential governance system was the correct regulation for Turkey and the economy,” Canikli said.

Read more: What Does Turkey's Referendum Mean For Foreign Investors?

He was also critical of credit rating agencies, describing them as being far from rational and saying their latest decisions were tailored for political targets, with no scientific or rational basis.

Canikli said Turkey had registered growth of 3.5 percent in the fourth quarter but credit ratings had not been renewed.

He added that all indicators were pointing to growth in 2017 and the state’s priority in the near term was to lower interest rates as they have a significant effect on inflation.

By Gokhan Kurtaran

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