The Turkish Treasury close to launch Islamic rent certificates
ANKARA - Anatolia News Agency
Finance Minister Şimşek (L) gives a seat to the Deputy PM Babacan at a joint press conference at the Prime Ministry yesterday.
Turkey should assume its place in the fast-growing market of rent certificates that are compliant with Islamic law, Deputy Prime Minister Ali Babacan said yesterday.“We find [developing the sukuk market] important in terms of the diversification of financial sources and investment options for both national and international investors. The Turkish Treasury’s move to issue rent certificates will encourage the private sector as well. We have completed regulations on rent certificate issuance,” he said at a joint press conference with Finance Minister Mehmet Şimşek.
The total issuance of rent certificates in the world had amounted to $170 billion as of today, Babacan said at the meeting, which focused on issues discussed in the Cabinet and the Economy Coordination Committee. The deepening of the rent certificate market is important for Istanbul’s bid to become an international finance center, he said.
“We think it will not be only a national market, but a regional and global market. These certificates will be traded on the Istanbul Stock Exchange [İMKB] everyday,” he said.
Şimşek said the regulation would lift obstacles against international funds that are active in Turkey. Only the domestic revenues of these funds will be subject to taxation, he said, adding that portfolio managers could participate in these funds up to a total of 20 percent. A number of local participation banks are waiting for the sukuk issue to replace their some government bonds, which are doubted to be interest-based.
A fee of 100 liras will be charged on cell phones brought in from abroad, Şimşek also said at the meet.
Retirement system to see big change
ANKARA - Anatolia News Agency
The government plans to launch a new individual retirement system, whereby the government will contribute an additional 25 percent of the amount an insuree deposits in the pension system, said Deputy Prime Minister Ali Babacan.
The regulation will encourage insurees to stay in the system, Babacan said. The new system will start after a three-month transitional period following the enactment of the regulations. The government contribution is not tax deductible. “The insurees will be entitled to 15 percent of the government contributions in the third year. The ratio will rise to 35 percent in sixth year, 60 percent in the tenth year and 100 percent at retirement. The maximum amount of government contribution will be limited to 25 percent of annual gross salary,” Babacan said.
The updated individual retirement system will increase domestic savings, and this will result in the lowering of the risk premium of Turkey, he adde.
