​Hotel Transition at Crossroads

TURKEY - In Brief 24 Jul 2019 by Atilla Yesilada

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Our muses permitting, in a few days, the Global Source Partners Turkey team will issue its flagship Quarterly Report. By its very design the Quarterly is concise and forward-looking. The humble Politics Author felt the need to explain his view of the coming 12 monthsin detail to make sure nothing gets lost in the necessary compression forced by the brevity of the Quarterly Report. The Reality and Erdogan’s view Our baseline scenario for the next 6-12 months has changed very little since the beginning of the year.Erdogan Administration’s unorthodox economic policies and the habit of constantly picking up fights with key allies has damaged economic sentiment, precipitating a near-permanent state of subpar growth and high inflation.The length of the recession has exacerbated the corporate debt problem, which has been shifted to the shoulders of banks via forced restructurings, rendering them, in turn, unable to support revival of activity with fresh loans. President Erdogan and his chief economics maestro Albayrak don’t view the economic panorama as described above.For them, thanks to the friendship with Trump and draconian (not to say unfair) actions taken to scare markets and players into submission, the devastating currency attacks had been averted.With a four-year election free period ahead and Fed and ECB appearing poised to activate the printing press once again, Mr. Erdogan intends to deploy even more radically heterodox measures to boost economic growth and put down his new rivals, namely Istanbul mayor Ekrem Imamoglu, and his erstwhile lieutenants Messrs. Ali Babacan and Prof. Ahmet Davutoglu. Erdogan doesn’t have four years to “set things right” As we have claim...