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Babacan: Turkey will be rid of recession by year-end
This is also what many respected international organizations have put forward in recent reports that predict the path of the global economy based on calculations.
Although the sound measures taken by developed economies have prevented the total collapse of the global economic order, these measures, which included an outlay of trillions of dollars to the markets, will surely increase the burden of debt for these nations, the minister emphasized. He further estimated that the debts of G20 economies may exceed their gross domestic products (GDP) this year.
The public expenditure used to prevent the spread of the problems of financial sectors, which led to the eruption of the global crisis, to the non-financial sector will not only exacerbate inflation in the medium and long run, but will also cause the tax rates in these countries to rise dramatically, Babacan noted. He suggested that the US and EU economies will lag far behind the relatively less-developed economies on the path to the recovery.
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Like virtually every country in the world, Turkey also sustained damage from the economic crisis, the minister said, admitting that the budget deficit and debt stock will rise this year. “Still, these increases will be at tolerable levels,” he noted.
‘No concessions on main principles'
The minister also underlined that the government has never made any concessions in the major principles governing the administration of a sound economy during the crisis. He said the basic criteria which were adopted during the high growth period between 2003 and 2007 were in effect during the crisis, too.
Concessions in these principles, like a deviation from fiscal discipline or heading toward populist policies, would have had a huge cost in the long run, the minister explained.
MÜSİAD President Ömer Cihad Vardan also addressed the audience at the iftar meal, largely to express the association's view on the government's latest democratic initiative, which is being debated widely because of the way it addresses the Kurdish problem. He said the association applauds the government's steps toward spreading peace and mutual understanding among citizens, adding that the work involved will surely contribute to the economic development of the country as a whole. In addition to this, the initiative must encompass all obstacles that have hindered the realization of the country's full potential for many years.
Babacan confirmed these requests in his speech, saying that on the basis of economic stability, there must be a strong democracy. Babacan also emphasized the importance of the continuation of political reforms.
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