End of ‘domestic ceasefire’ undermines investments in Turkey: Rating agency

ISTANBUL - Reuters

Credit rating agency JCR Eurasia Rating’s head, Orhan Ökmen, says the end of the state “domestic ceasefire” is undermining Turkey’s place as an investable country, referring to the recent spike in military and police operations against armed groups inside the country.

“The state of ‘domestic ceasefire’ in Turkey has been ended by the existing government, which also initiated this transition period. With this move, one of the biggest reasons that enabled Turkey to be in the league of investable countries has been weakened,” Ökmen said in a written statement. 

The agency set the rating for Turkey as “BBB-“and the rating’s outlook as “stable.” 

Ökmen described the possibility of snap elections as “waste of time,” adding that the end of the ceasefire has made the country more vulnerable to violence amid militant reactions from the Islamic State of Iraq and the Levant (ISIL). 

“Political risks will have highly destructive effects, specifically on consumer demand, production and employment in Turkey,” he said. 

Ökmen also said Turkey has become closer to third world countries because of its lowering standards in judicial freedom, the separation of legislative and executive powers, and the freedom of press. 

“The deepening moves of the financial sectors could not be complemented with moves to make the public sector more accountable and make the reel sector more transparent. Without the necessary structural and judicial reforms in these fields, political instability will continue,” he said.