Babacan: "Turkey will be among the first countries to recover from the crisis"

In opening remarks at the Seventh International Finance Summit in Istanbul yesterday, Deputy Prime Minister for the Economy Ali Babacan said, "In the '90s, state banks always had liquidity and capital deficits, while today they possess fewer non-performing loans than the sector average. This is testimony to the impressive development of the economic understanding in Turkey." Stressing the role the Turkish financial system's structural strength should play in keeping the nation's economy stable during times of crisis, Babacan said, "All of the relevant institutions put forward measures in a timely matter, and these measures are the reason our financial system is so strong." Babacan said Turkey would be one of the first countries to emerge from the global economic crisis but also stressed the importance of the European economy in this process. "Europe is recovering at a slower pace than global trends," he said. "Next year we expect Europe to achieve near-zero growth. This is especially relevant for Turkey, because Europe is an important export market. The faster Europe recovers, the faster our economy will recover." Babacan said that although some of Turkey’s problems originated from external economic developments, many arose from internal crises. Speaking on the importance of confidence in the economy, Babacan stated that production, consumption and investment are all elusive without confidence. Babacan said he expects employment to increase, with a small drop in unemployment next year. "Firms are holding back on hiring and are trying to boost efficiency," he said. "If there is no global recovery in employment, however, then there will be a delay in the recovery of consumption. We therefore need to focus on increasing employment globally." He added, "Even with a great crisis of this magnitude and even though Turkey’s exports and consumption have shrunk, Turkey has emerged from this crisis as one of the least-affected nations. From this point on we will act with caution, but also have unwavering faith in Turkey’s future." Also speaking at the meeting, Ersin Ozince, the president of the Turkish Banks Association (TBB) and IsBank, highlighted that Turkey’s potential has not changed due to the crisis and that the 2 billion people living in the region still need the country’s entrepreneurial leadership.