Turkey: An Island of Stability & Confidence

A decade ago, when my party, the Justice and Development Party, better known by its Turkish acronym, AK Party, embarked on its journey to govern Turkey, it announced its democratization and development program. The key element of this program in relation to economic policies is a continuous and sustainable economic growth strategy. An integral part, among others, of our strategy has been attracting foreign investment, acknowledging its contribution to economic development. As we have not only included foreign investment in our economic program, we have also implemented effective reforms that have turned Turkey into an attractive destination for foreign investment. Moreover, we have reinforced our economic policies with political stability. In a politically and economically volatile region, Turkey has been an island of political stability and economic confidence.

This hindsight vindicates that our economic policies and reforms have yielded results. During our administration over the past decade, the Turkish economy has grown robustly with an average annual real GDP growth rate of 5%. In the meantime, Turkey attracted more than $120 billion of FDI. Our sound economic policies and reforms have also strengthened Turkey against economic shocks and crises. During the global financial crisis in 2009, many banks had to be bailed out by governments in the US and Europe, whereas not even a single bank required monetary or administrative support from the government in Turkey.

Again, while the recent sovereign debt crisis has engulfed many economies in Europe, Turkey’s public finance indicators have been impressive; Turkey drastically reduced its gross public debt from 74% of GDP in 2002 to 36% in 2012. That is why, though belatedly, Turkey has recently been upgraded to investment grade by major credit rating agencies. Turkey has been the only economy that has been upgraded several notches since the onset of the 2009 global financial crisis. While the crises have caused many economies to struggle with increasing unemployment, Turkey created around 3.5 million new jobs between 2009 and 2012, whereas total employment in the EU-27 countries decreased by 1.5 million.

While the above and many other figures have altogether been a test for our economic policies, the real test for them has been our people’s trust in and approval of our policies. My party won the last three consecutive general elections with landslide victories, increasing its votes in every one of these elections. This approval by our people has encouraged us to implement more reforms and further improve Turkey’s investment climate. As long as we have a political mandate from our people, we will continue to serve them through sound economic policies and reforms. As such, Turkey will continue to be a safe haven for global investors where they can find strong economic confidence backed by genuine political stability that is supported by the will of the people of Turkey.

© The Business Year – September 2013