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 to Host World Investment Conference on November 25-27

A general view of Riyadh, Saudi Arabia. (SPA)
A general view of Riyadh, Saudi Arabia. (SPA)
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Saudi Arabia to Host World Investment Conference on November 25-27

A general view of Riyadh, Saudi Arabia. (SPA)
A general view of Riyadh, Saudi Arabia. (SPA)

Under the patronage of Prince Mohammed bin Salman bin Abdulaziz Al Saud, Crown Prince and Prime Minister, the World Association of Investment Promotion Agencies (WAIPA) and Invest Saudi will hold the 28th annual World Investment Conference (WIC) in Riyadh from November 25 to 27.

The event will gather global leaders in investment, government, and international organizations to tackle the theme “Harnessing Digital Transformation and Sustainable Growth: Scaling Investment Opportunities”.

On the occasion, Saudi Minister of Investment Khalid Al-Falih said: “Under the wise leadership of Custodian of the Two Holy Mosques King Salaman bin Abdulaziz Al Saud and Crown Prince Mohammed, the Kingdom, driven by its ambitious Vision 2030, has become a premier world investment destination and is experiencing unprecedented growth in overall investment amounts and diversity.”

This year’s World Investment Conference in Riyadh “will be a platform for sharing our nation’s strategic vision with our partners, and an invaluable opportunity to highlight our status as a trusted partner for sustainable economic growth,” he added.

“We look forward to welcoming investment leaders from around the world to forge partnerships that will benefit both the Kingdom and global economies,” he stressed.

Vision 2030 has driven significant economic reforms in Saudi Arabia, attracting substantial foreign investment. Over 28,900 foreign investment licenses have been issued, reflecting the Kingdom's transformation into a major global investment hub.

Key factors contributing to this growth include 100% foreign ownership in specific sectors, streamlined commercial register procedures, simplified visa issuance, and other investor-friendly initiatives that have created a favorable and appealing environment for investors in various sectors, including renewable energy, logistics services, and AI.

The Kingdom's attractive investment landscape has also facilitated the development of a dynamic economy that leads in innovation and growth.

WAIPA Executive Director and CEO Ismail Ersahin said: “WAIPA is excited to bring the 28th WIC to Riyadh, a city that perfectly embodies the future of investment. The conference will provide a crucial platform for Investment Promotion Agencies and investors to discuss emerging opportunities in a rapidly evolving global landscape.”

“We deeply appreciate Saudi Arabia’s vision and leadership, which will ensure that this edition of WIC is an impactful gathering for all participants,” he remarked.

Key highlights of this year’s WIC are a range of conference tracks, such as high-level dialogues with government ministers, insightful sessions on technology, sustainability, and economic cooperation, as well as practical masterclasses for investment professionals, a dedicated entrepreneurship track that will emphasize the transformative role of startups and innovators, and exclusive matchmaking sessions that will facilitate strategic partnerships between investors, SMEs, and potential collaborators.

Participants will also have the opportunity to celebrate the achievements of Investment Promotion Agencies on the Awards Track, honoring innovation and excellence in investment facilitation.

This year’s WIC promises to be a pivotal forum as it aligns with global investment drivers: the disruptive influence of technology and AI, global supply chain resilience, energy transition toward sustainability, and the transformative role of entrepreneurs and startups in reshaping investment landscapes traditionally led by multinational corporations.

Leaders and stakeholders will discuss and explore how these factors are redefining economies and driving forward-looking investment models worldwide.

With its focus on scaling investment opportunities, WIC is designed to equip attendees with the tools, knowledge, and connections necessary to drive meaningful economic impact.