Fitch Ratings has upgraded Turkey’s credit rating on stronger fiscal policies and reduced financial risks.
Turkey’s ratings have been increased one notch to B+ from B with a positive outlook, the agency said on Friday.
“The upgrade reflects increased confidence in the durability and effectiveness of policies implemented since the pivot in June 2023, including greater-than-expected front-loading of monetary policy tightening, in reducing macroeconomic and external vulnerabilities,” Fitch said.
“Inflation expectations have eased and external liquidity risks have moderated, reflected by more favourable external financing conditions, higher reserves and a narrowing current account deficit.”
Last month, Turkey named the central bank’s deputy governor Fatih Karahan as its head following the resignation of Hafize Gaye Erkan, signalling a continuation of the transition to more investor-friendly, orthodox economic policies that Ms Erkan put in place.
Under Ms Erkan, the central bank abandoned an ultra-low interest rates policy that President Recep Tayyip Erdogan had advocated for years and focused on increasing interest rates to address rising inflation.
“The central bank has tightened monetary conditions through a combination of larger-than-expected interest rate hikes to 45 per cent, absorption of excess liquidity through reserve requirements and deposit auctions, and targeted credit policies,” the rating agency said.
As a result, inflation expectations have eased, and “overall credit growth has slowed, but it remains high for household loans,” it added.
Fitch expects inflation to average 58 per cent in 2024 and finish the year at 40 per cent, above the central bank's intermediate target of 36 per cent. Inflation is forecast to fall further to 29 per cent in 2025 amid continued tightening of the monetary policy.
International reserves stood at $131 billion at the beginning of March, $32 billion higher than June 2023, according to the agency.
Turkey’s current account deficit is forecast to fall to 2.6 per cent of GDP in 2024, from 4.2 per cent of GDP in 2023 and further to 2.2 per cent of GDP in 2025 as growth in tourism receipts continues, and tight monetary policy and trade growth with its main partners are maintained.
Turkey is strengthening its trade ties. Its non-oil trade with the UAE grew by 103.7 per cent year-on-year in 2023, the highest among the top 10 trading partners after the two countries in September put their Comprehensive Economic Partnership Agreement into effect.
It is also strengthening its ties with Saudi Arabia, the Arab world’s largest economy.
“Growth was resilient at 4.5 per cent in 2023, but we expect that a tighter policy mix weighing more forcefully on domestic demand and private consumption after the first quarter of 2024, combined with relatively weak external demand, will result in growth slowing to 2.8 per cent in 2024,” Fitch said.
Growth could then pick up to 3.1 per cent in 2025 on improved growth prospects for Turkey's main trading partners, according to the agency.
Turkey's economy is forecast to grow 3.1 per cent in 2024 and 3.2 per cent in 2025, the International Monetary Fund said in its January report. Its economy expanded by 4 per cent in 2023.
How will Gen Alpha invest?
Mark Chahwan, co-founder and chief executive of robo-advisory firm Sarwa, forecasts that Generation Alpha (born between 2010 and 2024) will start investing in their teenage years and therefore benefit from compound interest.
“Technology and education should be the main drivers to make this happen, whether it’s investing in a few clicks or their schools/parents stepping up their personal finance education skills,” he adds.
Mr Chahwan says younger generations have a higher capacity to take on risk, but for some their appetite can be more cautious because they are investing for the first time. “Schools still do not teach personal finance and stock market investing, so a lot of the learning journey can feel daunting and intimidating,” he says.
He advises millennials to not always start with an aggressive portfolio even if they can afford to take risks. “We always advise to work your way up to your risk capacity, that way you experience volatility and get used to it. Given the higher risk capacity for the younger generations, stocks are a favourite,” says Mr Chahwan.
Highlighting the role technology has played in encouraging millennials and Gen Z to invest, he says: “They were often excluded, but with lower account minimums ... a customer with $1,000 [Dh3,672] in their account has their money working for them just as hard as the portfolio of a high get-worth individual.”
UK-EU trade at a glance
EU fishing vessels guaranteed access to UK waters for 12 years
Co-operation on security initiatives and procurement of defence products
Youth experience scheme to work, study or volunteer in UK and EU countries
Smoother border management with use of e-gates
Cutting red tape on import and export of food
The line up
Friday: Giggs, Sho Madjozi and Masego
Saturday: Nas, Lion Bbae, Roxanne Shante and DaniLeigh
Sole DXB runs from December 6 to 8 at Dubai Design District. Weekend pass is Dh295 while a one day pass is Dh195. Tickets are available from www.soledxb.com
Killing of Qassem Suleimani
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UK's plans to cut net migration
Under the UK government’s proposals, migrants will have to spend 10 years in the UK before being able to apply for citizenship.
Skilled worker visas will require a university degree, and there will be tighter restrictions on recruitment for jobs with skills shortages.
But what are described as "high-contributing" individuals such as doctors and nurses could be fast-tracked through the system.
Language requirements will be increased for all immigration routes to ensure a higher level of English.
Rules will also be laid out for adult dependants, meaning they will have to demonstrate a basic understanding of the language.
The plans also call for stricter tests for colleges and universities offering places to foreign students and a reduction in the time graduates can remain in the UK after their studies from two years to 18 months.
Dust and sand storms compared
Sand storm
- Particle size: Larger, heavier sand grains
- Visibility: Often dramatic with thick "walls" of sand
- Duration: Short-lived, typically localised
- Travel distance: Limited
- Source: Open desert areas with strong winds
Dust storm
- Particle size: Much finer, lightweight particles
- Visibility: Hazy skies but less intense
- Duration: Can linger for days
- Travel distance: Long-range, up to thousands of kilometres
- Source: Can be carried from distant regions
Boston%20Strangler
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Sole survivors
- Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
- George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
- Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
- Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
COMPANY PROFILE
● Company: Bidzi
● Started: 2024
● Founders: Akshay Dosaj and Asif Rashid
● Based: Dubai, UAE
● Industry: M&A
● Funding size: Bootstrapped
● No of employees: Nine
Volvo ES90 Specs
Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)
Power: 333hp, 449hp, 680hp
Torque: 480Nm, 670Nm, 870Nm
On sale: Later in 2025 or early 2026, depending on region
Price: Exact regional pricing TBA
What can victims do?
Always use only regulated platforms
Stop all transactions and communication on suspicion
Save all evidence (screenshots, chat logs, transaction IDs)
Report to local authorities
Warn others to prevent further harm
Courtesy: Crystal Intelligence
The Little Things
Directed by: John Lee Hancock
Starring: Denzel Washington, Rami Malek, Jared Leto
Four stars
Top%2010%20most%20competitive%20economies
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ESSENTIALS
The flights
Emirates flies from Dubai to Phnom Penh via Yangon from Dh2,700 return including taxes. Cambodia Bayon Airlines and Cambodia Angkor Air offer return flights from Phnom Penh to Siem Reap from Dh250 return including taxes. The flight takes about 45 minutes.
The hotels
Rooms at the Raffles Le Royal in Phnom Penh cost from $225 (Dh826) per night including taxes. Rooms at the Grand Hotel d'Angkor cost from $261 (Dh960) per night including taxes.
The tours
A cyclo architecture tour of Phnom Penh costs from $20 (Dh75) per person for about three hours, with Khmer Architecture Tours. Tailor-made tours of all of Cambodia, or sites like Angkor alone, can be arranged by About Asia Travel. Emirates Holidays also offers packages.
