Sevin Ekinci

TurkeyNovember 2011

Main Subjects

• Economic Prospects for 2012

• Politics- A new constitution

• Governmental system-AKP targets 2023

• Foreign Relations (EU, Cyprus, ME, NA)

Economic ProspectsA Relative Advantage

Economic ProspectsA Relative Advantage

Economic ProspectsA Relative Advantage

Economic ProspectsA Relative Advantage

Economic ProspectsA Relative Advantage

Economic Prospects

• Proactive monetary policy

The objective of macroprudential policy is to reduce systemic risk by

1. Reducing the pro-cyclicality of the financial sector

2. Improving its resilience to adverse shocks; by explicitly incorporating the inter-linkages between, and common exposures of, all institutions

Proactive monetary policy yielded its return

Economic Prospects: lower credit use would ease current account deficit

We have more positive prospects than market consensus

Politics

• A new Constitution

Process:Debates between AKP-CHP-BDP-MHPJoint opinions of AKP-CHP-BDP-MHP

Most likely scenario:A referendum by end-2012 which overrules presidential system.

Governmental system• AKP targets 2023Medium-Term Economic Program covers 2012-2014; no ambition yet strong fiscal policy projections.Next elections-2014 (presidential); 2015 (parliamentary)

• Can they achieve to their 2023 target?Well it is conditional… On domestic and International developments (EU, Cyprus, Israel, Middle

East and North Africa)

Foreign Relations

• How the economy works in Turkey

• EU• Cyprus• Middle East• North Africa• Israel