Turkey beats growth forecasts in 2017: data

Istanbul (Shutterstock)
Updated 29 March 2018
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Turkey beats growth forecasts in 2017: data

ANKARA: Turkey posted surprisingly strong economic growth last year, official statistics showed Thursday, confirming the country’s status as one of the world’s fasted growing economies.
GDP growth came in at 7.4 percent in 2017 from the previous year, but even the strong figure did little to prop up the Turkish lira which has suffered from political concerns as well as worrying inflation and current account figures in recent months.
Thursday’s growth figure came in above the market consensus of 7.25 percent, but fell just short of a forecast by President Recep Tayyip Erdogan who said in December he expected the economy to grow by 7.5 percent in 2017.
Growth was 3.2 percent in 2016 when a series of terror attacks and a July coup bid aimed at unseating Erdogan negatively affected the economy which only returned to strength last year.
In the fourth quarter alone the economy grew by 7.3 percent year-on-year, after a revised 11.3 percent increase in the third quarter.
Data from the Turkish Statistics Institute (TUIK) showed that growth was driven by the industrial, services and construction sectors.
Turkish Economy Minister Nihat Zeybekci welcomed the “spectacular achievement” in a statement, saying that it meant Turkey now ranked first among the G20 economies.
One of Erdogan’s senior advisers Hatice Karahan said on Twitter that “sound government policies supported this success along with an improvement in confidence,” adding the focus would now be on reforms.
Meanwhile, London-based emerging markets economist Timothy Ash said in a note that the 7.4 percent figure “puts Turkey well at the top of the European growth stakes, and I guess in the same stratosphere as the likes of China and India.”
Turkey’s growth figure was higher than China’s of 6.9 percent for 2017.
Yet, the Turkish lira has lost over five percent of its value against the dollar since January.
In late morning Thursday, the currency was steady against the greenback on the day, at 4.00.
Inflation last month was at 10.26 percent, which is double the Turkish central bank’s target.
William Jackson, senior emerging markets economist at Capital Economics in London, said last week in a note that the lira’s sharp decline earlier in March “reinforced concerns about the risks posed by the widening current account deficit.”
Economists have also raised concerns about overheating in the economy and the sustainability of the fast pace of growth.


Gulf stocks extend losses on tanker attacks

Updated 17 June 2019
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Gulf stocks extend losses on tanker attacks

  • Cautious mood among investors as fears of military confrontation rise

DUBAI: Stock markets in the Gulf extended losses on Sunday reflecting a cautious mood among investors following last week’s oil tanker attacks. 

The attacks on the tankers in the Gulf of Oman on Thursday raised fears of a military confrontation in a vital shipping route for global oil supply and heightened tensions between Iran and the US, which have been in a standoff over Iran’s nuclear program. 

The Saudi index had dropped 1.6 percent on Thursday and fell a further 0.6 percent on Sunday after slight gains in early trade. Most Saudi banks were down, despite Sunday’s announcement by Saudi British Bank that its merger with Alawwal Bank was completed. 

HIGHLIGHTS

• Gulf stocks reverse early gains.

• Gulf of Oman tanker attacks dampen investor mood.

• Saudi banks mostly down despite SABB-Alawwal merger.

The two banks have combined to create the country’s third largest lender, becoming a single listed company after regulatory approvals. SABB’s shares shed 0.1 percent. Alinma Bank, however, gained 0.4 percent, and was one of the stocks registering the highest trading volume on Sunday. 

In the UAE, the Dubai and Abu Dhabi indexes fell 0.7 percent and 0.2 percent, respectively. The Dubai market had risen earlier in the day, boosted by DAMAC Properties and Union Properties, which closed up 2.2 percent and 0.5 percent, respectively. But heavyweight Emaar Properties, the largest developer in the emirate, fell 2.5 percent, weighing on the index. 

Dubai’s telecom operator Du (Emirates Integrated Telecommunications Co) shed 0.4 percent, reversing earlier gains, after it said the UAE sovereign wealth fund Emirates Investment Authority had increased its stake by buying 463.3 million shares from Mamoura Diversified Global Holding and General Investments. 

In Abu Dhabi, blue chip companies Aldar Properties, First Abu Dhabi Bank and Abu Dhabi National Oil Company for Distribution, led losses, dragging down the main index. The other Gulf markets were all in the red, except for the Bahrain index, which rose slightly. 

In Egypt, the index gained 0.2 percent, boosted by a 4.5 percent gain by Pioneers Holding Company for Financial Investments. The company said one of its divisions, Arab Dairy Products, had received a letter of intent from a Netherlands based company about a plan to buy it.