Turkey has more to do for upgrade: S&P

ISTANBUL

‘There are some issues that are not compatible with our criteria to have an investment grade,’ the Standard & Poors Turkey manager has said. REUTERS photo

Standard & Poor’s is going to review Turkey’s credit rating within the year, the agency’s Turkey regional manager, Zeynep Holmes, told broadcaster CNBC-e, adding that this should not be perceived as an indication of a rating upgrade.

“Turkey has a lot to do for a rating upgrade,” Holmes said yesterday, adding that the country’s gross domestic product (GDP) levels and current account deficits were important determinants.

She also noted the per capita income in Turkey, which is around $10,000, is still below other investable countries.

Holmes’ remarks came just a few days after the agency unveiled its report on Turkish companies, in which it said Turkish companies had become more competitive thanks to low-cost borrowing.

S&P is currently the only rating agency among the top three that has kept Turkey’s rating one notch below investment grade at BB- plus with a stable outlook. Moody’s joined Fitch Ratings in a recent decision and upgraded Turkey’s credit rating to investable level.

The agency will hold a seminar on June 4 in Istanbul that will be attended by S&P EMEA chief economist Jean-Michel Six, and Holmes said this meeting was not an indicator of a potential rating upgrade.