Eni rig sails for Morocco after Turkey blocks Cyprus search

An employee walks by banners with name and sign of energy firm Eni at Strovolos area in capital Nicosia, Cyprus. (AP)
Updated 27 February 2018

Eni rig sails for Morocco after Turkey blocks Cyprus search

NICOSIA: An Italian drillship blocked by the Turkish navy from exploring for gas off Cyprus was on Tuesday headed for Morocco, a website monitoring sea traffic showed.
The Saipem 12000 vessel, chartered by Italian giant Eni, anchored off the Cypriot port of Limassol after it was forced on Friday to abandon its mission following a two-week standoff with Turkish warships.
Ankara bitterly opposes attempts by the Greek-majority Republic of Cyprus to exploit resources in the waters off the divided island, insisting it is protecting the rights of the Turkish-Cypriot community.
The Marine Traffic website that measures ship movements around the globe estimated that the vessel should arrive off the coast of Morocco by March 9.
An Eni spokesman reiterated a statement by the firm’s boss that the drillship “would head to Morocco and return to Cyprus when conditions allow.”
Cypriot Energy Minister George Lakkotrypis on Monday said the postponement of the test drilling was a “setback” but the government would continue with its energy search as planned.
The latest spike in tensions over energy resources has complicated efforts to restart talks aimed at reunifying Cyprus after they collapsed last year.
Cyprus has been divided since 1974 when Turkish troops invaded and occupied the northern third of the island in response to a Greek military junta-sponsored coup.
EU member Cyprus argues that the island’s untapped energy riches belong to the state and the wealth would be shared with the Turkish-Cypriot community once the island was reunified.
Turkish President Recep Tayyip Erdogan warned foreign energy companies not to “overstep the mark” in the Mediterranean after Turkey’s navy blocked the Italian vessel on February 9, claiming they were carrying out maneuvers.
Cyprus expects more exploratory drills in the second half of 2018 by US giant ExxonMobil and its partner Qatar Petroleum.


$8bn blow to Erdogan as investors flee Turkey

Updated 55 min 46 sec ago

$8bn blow to Erdogan as investors flee Turkey

  • Overseas holdings in Istanbul stock exchange are at lowest in 16 years

ANKARA: Foreign capital is flooding out of Turkey in a massive vote of no confidence in President Recep Tayyip Erdogan’s economic competence.
Overseas investors have withdrawn nearly $8 billion from Turkish stocks since January, according to Central Bank statistics, reducing foreign investment in the Istanbul stock exchange from $32.3 billion to $24.4 billion.
As recently as 2013, the figure was $82 billion, and foreign investors now own less than 50 percent of stocks for the first time in 16 years.
“Foreign investment has left Turkey for several reasons, both internal and external,” Win Thin, global head of currency strategy at Brown Brothers Harriman, told Arab News.
“Externally, investors fled riskier assets like emerging markets during the height of the coronavirus pandemic. Some of those flows are returning, but investors are being much more discerning and Turkey does not seem so attractive.”
In terms of internal factors, Thin said that Turkish policymakers had made it hard for foreign investors to transact in Turkey. “This includes real money clients, not just speculative.
“By implementing ad hoc measures to try and limit speculative activity, Turkey has made it hard for real money as well. Besides these problems, Turkey’s fundamentals remain poor compared to much of the emerging markets.”
Erdogan allies claim international players are manipulating the Istanbul stock exchange through automated trading, and have demanded action to make it difficult for them to trade in Turkish assets.
Goldman Sachs, JPMorgan, Merrill Lynch, Barclays and Credit Suisse were banned this month from short-selling stocks for up to three months, and this year local lenders were briefly banned by the banking regulator from trading in Turkish lira with Citigroup, BNP Paribas and UBS
JPMorgan was investigated by Turkish authorities last year after the bank published a report that advised its clients to short sell the Turkish lira.
MSCI, the provider of research-based indexes and analytics, warned last month that it may relegate Turkey from emerging market status to frontier-market status because of bans on short selling and stock lending.
With the market becoming less transparent, overseas fund managers, especially with short-term portfolios, are unenthusiastic about the Turkish market and are becoming more concerned about any forthcoming introduction of other liquidity restrictions.
The exodus of foreign capital is likely to undermine Turkey’s drive for economic growth, especially during the coronavirus pandemic when employment and investment levels have gone down, with the Turkish lira facing serious volatility.