Turkey has been called the most vulnerable among developing economies
In 2013 current account deficit in Turkey significantly exceeded analysts’ estimations and made up 8% of GDP. In 2012 deficit primarily financed by short-term capital amounted to 49.5 bln dollars, according to Financial Times.
Tim Ash, Head of Emerging Markets Research at Standard Bank, considers the country’s deficit arises concern, including shortage of 8,3 bln dollars last December. This information proves the country goes back to the economic model existing till 2012, before exporting gold to Iran.
Tim Ash also acknowledged that amount of direct foreign investments totaling 9,6 bln dollars in 2013 dropped twofold as compared with that five years ago. Simultaneously, it heavily affected foreign investments; foreigners are damping Turkey’s stocks and bonds – an alternative to deficit refinancing. The banks of Turkey had to cover deficit in funds with credits from abroad.
Currently, Turkish economy is aimed at achieving short-term gains, not possessing more reliable funding sources.
