Why the growth slowdown in Turkey now?
Güven Sak, PhD
30 October 2016
Have you seen the Putinphone? Caviar, a Russian jewelry company, has designed a limited edition of them on the occasion of the 63rd birthday of the Russian president. It looks like the iPhone 6, except Putin’s face is encrusted in gold on the back, as is the seal of the Russian presidency and a few lines of the country’s national anthem. This is all on top of a titanium base that is supposed to reflect the national will of the Russian people, as embodied by their omnipresent president. Here’s the rub though: When you turn the phone on, it’s just a regular iPhone, “designed by Apple in California” and manufactured by Foxconn in China. That’s because there are two types of countries in the world: Countries that make iPhones and countries that make iPhone covers. It’s a pity that Russ
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A small but decisive step towards rule of law in Turkey?
Güven Sak, PhD
23 October 2016
“The power to become habituated to his surroundings is a marked characteristic of mankind,” writes John Maynard Keynes in the opening sentence of The Economic Consequences of the Peace. “Very few of us realize with conviction the intensely unusual, unstable, complicated, unreliable, temporary nature of the … organization by which Western Europe has lived for the last half century.”
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Why is the Turkish Lira rapidly depreciating?
Güven Sak, PhD
16 October 2016
According to the latest round of the World Values Survey, only 11 percent of Turks believe that “most people can be trusted”. In Germany, that number is 45 percent. When it comes to trusting others, Turks are at the bottom of the list. Yet in comparison to others, Turks save less and borrow more. The current account deficit stands testimony to that. So Turks are surrounded by people they don’t trust, but don’t build up financial security around them. Sounds like a recipe for anxiety to me.
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Increasing inflows into Turkey after downgrade
Güven Sak, PhD
09 October 2016
Moody’s downgraded Turkey to a speculative level on 22 September. That makes two such grades, the first being S&P’s decision soon after the attempted coup in July. Moody’s downgrade was based on the “weakening in previously supportive credit fundamentals, particularly growth and institutional strength.” So, one would expect foreign fund outflows from the country as investors shy away from Turkish assets. Yet, like a slap in the face of Moody’s and S&P analysts, portfolio investors are flocking in. Foreign investors bought a net of $618 million worth of stocks and bonds in five trading days through September 30. That’s the highest inflow in the last 7 weeks, mind you. So, foreign investors reacted to Moody’s downgrade by buying more Turkish assets.
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Why I don’t have a photo with Shimon Peres
Güven Sak, PhD
01 October 2016
I first met the late Shimon Peres more than 12 years ago. Israeli disengagements on Gaza were just a theoretical construct under discussion then. I was there to find a way to privatize the peace process. The idea wasn’t mine, but that of Peres, so who better to talk to about it? He was then Minister of Development for Negev, Galilee and provided generous support a process we came to call the “Ankara Forum,” and effort to use connections of business to drown out the conflict. Peres’ support lasted throughout his Presidency.
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