notices - See details
Notices
O
Osman (not verified)
3rd July 2024 | 8:17pm

An unnecessary emphasis is placed here on the Turkey's relatively high capital stock level as an alleged reason for Turkey's problems. On the contrary, the recent loose monetary policy has caused a sharp uptick in the private consumption in the composition of Turkish GDP. Claiming that the high investment Turkey has enjoyed in recent decades has been anything but detrimental to its growth prospects looks quite unfounded, since for an emerging economy an ideal & sustainable growth should be driven mainly by investments, not by private consumption. Essential problem regarding Turkey's investment level is not whether it has been too high, but how it has been financed (which is through a high level of foreign borrowing). Boosting the savings rate and allocating more resources to investments rather than private consumption will render the Turkish economy more robust and stable.