Businesspeople warn of slowdown in Turkish economy

Businesspeople warn of slowdown in Turkish economy

Aysel Alp - ANKARA
Businesspeople warn of slowdown in Turkish economy

AA Photo

The Turkish economy has recently slowed down and many businesspeople have experienced problems in cash proceedings and check clearing, Union of Chambers and Commodity Exchanges of Turkey (TOBB) head Rifat Hisarcıklıoğlu has said. 

Hisarcıklıoğlu warned of “unpleasant surprises” at the 71st General Meeting of the TOBB in Ankara on May 4.
“There has been a slowdown in economic activities in the Turkish market and as businesspeople, we have increasingly faced problems receiving money for our goods and services. We need to accelerate our economic activities,” he said at the meeting, which was also attended by Prime Minister Ahmet Davutoğlu, main opposition Republican People’s Party (CHP) head Kemal Kılıçdaroğlu, and Nationalist Movement Party (MHP) Deputy Group Chair Oktay Vural, as well as TOBB members. 

Hisarcıklıoğlu said Turkey must be “extra careful” in managing its economy as it is located next to risky geopolitical regions. 

“These risks have been putting limitations on our exports, tourism sector, investments and international construction projects, although decreasing oil prices have had a positive impact on our foreign trade deficit,” he added. 

The TOBB head said Turkey had recently been “over-focused on its local agenda” ahead of the June elections, warning of global economic surprises in 2015. 

“We must follow what is happening in other countries. 2015 will be full of surprises for the global economy. We see ups and downs in the economies of the U.S., Europe, Russia and China. Turkey will be affected positively if the recovery trend continues in European economies. Additionally, we see a slowdown in emerging markets’ economic activities, apart from India. The world’s largest 20 economies, which make up some 85 percent of the world’s production activities, grew by 3.4 percent in 2014. But their economic activities are now slowing down … We also see a slowing trend in the Russian economy, despite the recent rebounds in the oil prices,” Hisarcıklıoğlu said. 

“The global economy has been recovering, but in inefficient manner. I warn you all: Be ready for the surprises and keep away from taking any big risks,” he added. 

He underlined that Turkey is now stuck in the notorious “middle-income trap” and needs “transformative steps” to overcome this problem. 

“Only way for us to increase our income per capita … is to produce advanced technologies. We can overcome this trap as long as we define the sectors where Turkey can be stronger and set strategies to take the lead in these sectors with state representatives,” Hisarcıklıoğlu said.

He repeated that Turkey needs a “new growth model” supported by robust structural reforms, and also underlined the need for a comprehensive judicial, educational and tax reform.