Reforms key for Europe, Babacan says

MEXICO CITY-Anatolia News Agency

Turkish Deputy Prime Minister Ali Babacan warned European countries about their debt crisis at a reception dinner for the G-20 Summit in Mexico City over the weekend, attended by the G-20 finance ministers and central bank governors.

“It is very important for Greece to follow its reform program for the country to become competitive and re-take its market share,” said Babacan in his speech, following Mexican Prsident Felipe Calderon’s speech.

Babacan stressed the importance of financial consolidation and structural reforms, saying that only with these reforms would the global economic balance be achieved once again. He warned countries to shy away from protectionist measures.

“It is crucial for European banks to lower their risk perception rates. Banks should keep on financing the real economy. This topic is more for the European regulators and they need to be very careful about this,” said Babacan.

He also touched upon the Turkish economy, saying that by 2014 the government hoped to reduce debt to 32 percent of national income and that income disparities in Turkey were quickly being remedied. In terms of growth, Babacan said he expected Turkey to grow by 4 percent in 2012.