S&P Affirms Türkiye’s Successful Economic Plan

People shop at Grand Bazaar in Istanbul, Türkiye, November 4, 2022. REUTERS/Dilara Senkaya
People shop at Grand Bazaar in Istanbul, Türkiye, November 4, 2022. REUTERS/Dilara Senkaya
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S&P Affirms Türkiye’s Successful Economic Plan

People shop at Grand Bazaar in Istanbul, Türkiye, November 4, 2022. REUTERS/Dilara Senkaya
People shop at Grand Bazaar in Istanbul, Türkiye, November 4, 2022. REUTERS/Dilara Senkaya

Credit ratings agency S&P on Friday moved Türkiye’s long-term sovereign rating one notch higher to B+ from B, with a positive outlook, according to a statement late Friday.

The ratings agency then forecasted rising portfolio inflows and narrowing current account deficits over the next two years, alongside declining inflation and dollarization.

“Following local elections in Türkiye, we believe the coordination between monetary, fiscal, and incomes policy is set to improve, amid external rebalancing,” it said.

The agency said Turkiye's policymakers are set to persevere with efforts to reduce elevated inflation through a combination of monetary and credit tightening, less generous wage settlements, and gradual fiscal consolidation.

Türkiye has launched a series of steps meant to cool soaring inflation, which could reach around 75% in May when the government ends its plan to provide a monthly reduction on natural gas bills. Ahead of the 2023 parliamentary and presidential elections, the government has promised discounted natural gas bills for households for a year until May 2024.

S&P Global Ratings raised the country's rating outlook to positive in November in a move to recognize Türkiye’s shift to more orthodox economic policies and the central bank's steep rate hikes, made to rein in inflation, which climbed to 69.8 percent year-on-year in April despite raising the policy rate to 50 percent.

Türkiye ranks fourth in global inflation rates, surpassed by Argentina, Syria and Lebanon.

Fitch Ratings upgraded the country’s credit rating earlier this year to B+ while Moody’s raised its outlook to positive at the same time as affirming its B3 ranking.

Mehmet Şimşek, the Turkish treasury and finance minister, earlier cited his expectations for credit upgrades to continue in March following Fitch’s move.

“The positive outlooks of S&P, Fitch and Moody’s foreshadow further rating increases,” Simsek said Saturday in a post on X, formerly Twitter.

“The positive results of our program are reflected in the decisions of credit rating agencies,” he added.

“We are determined to carry the confidence in our country to the highest level with our strengthened program,” the minister also said.

Meanwhile, Burak Daglioglu, head of theTurkish Presidency Investment Office, said Türkiye last year rose to fourth place in Europe in attracting the most international investment projects.

“The $10.6 billion in international direct investment we attracted in 2023 is the most concrete sign of this success,” Daglioglu noted.

Commenting on a report by audit and consulting firm EY on foreign direct investment (FDI) projects in Europe in 2023, Daglioglu said Türkiye has maintained its steady rise in attracting the most international direct investment in Europe in the post-pandemic period.

He said EY found a significant fall from the previous year in FDI projects in Europe for the first time since the pandemic, blamed on factors such as low economic growth, high inflation, rising energy prices, and geopolitical risks.

He said 5,694 investment projects were announced in Europe, down 4% from the previous year.

The number of projects in Europe was 11% below its level in 2019 and 14% below the 2017 peak, according to Daglioglu.

He added that Türkiye ranked seventh in the European league in 2020 and fifth in 2022. “The country rose to fourth among the top 10 countries, attracting 375 international direct investment projects in 2023. With a 17% rise from the previous year, Türkiye also ranked first among the top 10 countries in terms of growth in 2023,” Daglioglu said.



Saudi Arabia Makes History with Adoption of Riyadh Treaty on Design Law

Photo of the Riyadh Diplomatic Conference on the Design Law Treaty (Asharq Al-Awsat)
Photo of the Riyadh Diplomatic Conference on the Design Law Treaty (Asharq Al-Awsat)
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Saudi Arabia Makes History with Adoption of Riyadh Treaty on Design Law

Photo of the Riyadh Diplomatic Conference on the Design Law Treaty (Asharq Al-Awsat)
Photo of the Riyadh Diplomatic Conference on the Design Law Treaty (Asharq Al-Awsat)

Saudi Arabia has made history by uniting the 193 member states of the World Intellectual Property Organization (WIPO) to adopt the Riyadh Treaty on Design Law. This landmark achievement, realized after two decades of deliberation, underscores the Kingdom’s leadership in enhancing the global intellectual property system.

The announcement came at the conclusion of the Riyadh Diplomatic Conference on the Design Law Treaty, a rare event for WIPO, which has not held a diplomatic conference outside Geneva for more than a decade. It was also the first such event hosted in Saudi Arabia and the Middle East, representing the final stage of negotiations to establish an agreement aimed at simplifying and standardizing design protection procedures across member states.

Over the past two weeks, intensive discussions and negotiations among member states culminated in the adoption of the Riyadh Treaty, which commits signatory nations to a unified set of requirements for registering designs, ensuring consistent and streamlined procedures worldwide. The agreement is expected to have a significant positive impact on designers, enabling them to protect their creations more effectively and uniformly across international markets.

At a press conference held on Friday to mark the event’s conclusion, CEO of the Saudi Authority for Intellectual Property Abdulaziz Al-Suwailem highlighted the economic potential of the new protocol.

Responding to a question from Asharq Al-Awsat, Al-Suwailem noted the substantial contributions of young Saudi men and women in creative design. He explained that the agreement will enable their designs to be formally protected, allowing them to enter markets as valuable, tradable assets.

He also emphasized the symbolic importance of naming the convention the Riyadh Treaty, stating that it reflects Saudi Arabia’s growing influence as a bridge between cultures and a global center for innovative initiatives.

The treaty lays critical legal foundations to support designers and drive innovation worldwide, aligning with Saudi Arabia’s vision of promoting international collaboration in the creative industries and underscoring its leadership in building a sustainable future for innovators.

The agreement also advances global efforts to enhance creativity, protect intellectual property, and stimulate innovation on a broader scale.

This achievement further strengthens Saudi Arabia’s position as a global hub for groundbreaking initiatives, demonstrating its commitment to nurturing creativity, safeguarding designers’ rights, and driving the development of creative industries on an international scale.

The Riyadh Diplomatic Conference, held from November 11 to 22, was hosted by the Saudi Authority for Intellectual Property and attracted high-ranking officials and decision-makers from WIPO member states.