Turkish prime minister in New York quest to soothe investor concerns

Rıza Canikligil NEW YORK

AA Photo

Prime Minister Ahmet Davutoğlu has sought to reassure some of the world’s leading investors about political and economic stability in Turkey during his meetings in New York. His bid to brush off escalating concerns about the investment climate in Turkey follows a series of increasingly strident remarks from President Recep Tayyip Erdoğan about the Central Bank’s policies.

“Turkey is an island of stability,” Davutoğlu told a group of investors and bankers during a luncheon organized by Goldman Sachs on March 4, as part of his New York visit accompanied by Turkey’s top economy officials, Deputy Prime Minister Ali Babacan, Finance Minister Mehmet Şimşek and Economy Minister Nihat Zeybekci.

The delegation, which also includes Istanbul Mayor Kadir Topbaş and Foreign Ministry Undersecretary Feridun Sinirlioğlu, held separate meetings with Citi and Bank of America Merrill Lynch.

President Erdoğan’s increasingly aggressive salvoes against the Central Bank and its governor, Erdem Başçı, have included claims that all those who are against low interest rates are guilty of “treason” against Turkey.

Against this backdrop, Davutoğlu used two main arguments to try to calm investor worries.
Firstly, he highlighted that Turkey is “immune” to the turmoil engulfing the surrounding region, describing the country as “an island of stability.”

“We experienced a new kind of distress after the Arab Spring. There six or seven fragile countries around Turkey such as Syria, Iraq, Lebanon, Ukraine, Yemen and Libya. When we look at these, Turkey stands out as an island of stability,” he said.

Secondly, Davutoğlu sought to emphasize “political stability” in Turkey and to persuade investors about the ruling Justice and Development Party’s (AKP) commitment to economic reforms.

“Political stability and economic stability are linked to each other. Turkey has both of these values,” he said.

 “We have steered through three general elections, two presidencies, and two referendums. Our party has emerged victorious from all of these. You see that our prime minister and president changed just before a new election, but it did not affect stability even a little,” Davutoğlu stressed.

The prime minister said he is “confident” that his party will come out on top after the June 7 elections too, saying the AKP expects to get around 48 to 52 percent of the vote.

“The party closest to us has around 20 to 22 percent of the vote. So there is no concern,” he said.

Davutoğlu praised Turkey’s economic performance, dubbing it “a promising country for future.”

“Despite many problems, we have grown at an average of 5.5 percent over the past 12 years. Our national income has multiplied by three-and-a-half times [in nominal terms]. The value of our economy rose to $840-$850 billion from $230-$240 billion in 2002, when we came to power,” he said.

Meanwhile, addressing a separate meeting with representatives of Turkish associations, Davutoğlu claimed that investors in New York do not perceive Turkey as a turbulent country.

“Nobody talked about Turkey as a country in crisis, nobody expressed doubt about Turkey’s future perspective,” he reportedly said.