Global crisis begins to worry Turkish top officials

Despite its fast recovery from the global economic crisis, Turkey should be ready for negative outcomes from the current problems faced in the U.S. and European economies, Deputy Prime Minister Ali Babacan warned Wednesday.

“We hope that the right decisions are made in Europe and that the political concerns over the debt limit in the United States will be solved,” Babacan said during a press meeting in Ankara with World Bank head Robert Zoellick. “If these [issues] are solved there will be no problem, but if not, we should be prepared for [possible] negative scenarios as well,” he said.

The deputy prime minister made his comments when asked about remarks by the ruling party’s deputy president, Bulent Gedikli, who said Tuesday that a new crisis was nearing for the global economy. Gedikli called for Turkish people to be cautious, saying: “Hold on to what you’ve got. Don’t spend too much.”

Babacan also said the government was considering the situation in Europe and the entire world while preparing its Medium-Term Economic Program, according to an Anatolia news agency report Wednesday. The World Bank chief also warned that the crisis in Europe might affect the Turkish economy.

Economic growth had slowed in the region due to developments in European economy – something that could affect Turkey’s exports and direct foreign investments in the country, Babacan said. “However, I believe that Turkey’s economic program is very strong,” he added.

Zoellick said, however, that the fact that some countries were growing rapidly and others slowly could pose a problem for Turkey in the future.

“Rising economies might be exposed to inflation problems in such a situation. As a fast-growing country, Turkey should be alert to inflation risks,” he said.

According to Zoellick, Turkey is important for both the regional and global economy. Strong growth in emerging economies, notably Turkey, could be a background factor supporting eurozone countries as they fight a debt crisis, he said, according to a report by Agence France-Presse on Wednesday.

Zoellick said the aim of his vis was to discuss with Turkish authorities what the country could do to reach its goals and to identify areas where the World Bank and Turkey could cooperate.


/Hurriyet Daily News/