Şimşek was speaking yesterday at a CEO Club meeting organized jointly in İstanbul by business and economy magazines Capital and Ekonomist. He noted that both Turkey and the rest of the world had begun to exit the recession before economies contracted any further thanks to viable monetary and fiscal policies. However, Şimşek said that careful deliberation was needed before lifting stimulus measures taken by governments in a bid to tackle the recession. Noting that the economic situation is still fragile, the minister explained that the debt-to-gross domestic product (GDP) ratio, which rose by 20 percentage points in world economies during the crisis, is predicted to increase by 20 points more in the next four to five years. Interest rates are also not expected to regain their pre-crisis levels by 2012, he stressed, underlining that it would take years to return to pre-crisis economic activity. In an assessment of Turkey’s outlook, Şimşek pointed out the country’s sound financial system and said the situation was positive for Turkey. “Turkey overcame the crisis well and successfully passed the stress test,” he noted.
Turkey made a solid start to the year, Şimşek said, adding that he believed this year the country would easily exceed its targets.” Turkey’s credit ratings were raised by several international rating agencies, he said, attributing this to the government’s practices to reduce exchange rate risk and public sector debt stock by a significant amount, along with special incentives introduced in a bid to support investments during the crisis. Furthermore, Turkey is the first country to unveil a middle term exit strategy from the crisis, he said.
