Please do not beat the police
Güven Sak, PhD
13 April 2012
In our experience, civilians do not beat police officers, but the police beat anyone and everyone at a moment’s notice. The other day I saw a brochure in Bern when I was going to the Federal Department of Foreign Affairs of Switzerland. It said, “Please do not use violence against police officers. They are doing their jobs.” At first I thought it was a joke. In our experience, civilians do not beat police officers, but the police beat anyone and everyone at a moment’s notice. In a way, police officers beat citizens as part of the job description. I am constantly complaining and asking why Turkey does not have this or that. It seems this is actually what we are lacking.
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Are problems about FX finance easing?
Fatih Özatay, PhD
12 April 2012
If Europe gets back into a chaos, we will initially face difficulty in meeting the FX requirement even in the case that the current account deficit eases. Critical statistics are announced one after another. Yesterday it was balance of payments figures for February. Here are some striking points: First, the current account deficit has decreased, though not at the desired level. Concerning cumulative figures for the preceding twelve months, the current account deficit had a record high $78.6 billion in October 2011. In February 2012, twelve-month cumulative current account deficit had a value of $75.3 billion. The cumulative of January and February demonstrate a $2 billion drop in the current account deficit.
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Towards a long and dirty war?
Nihat Ali Özcan, PhD
12 April 2012
Things are getting complicated in Syria. As for the Annan Plan, it always looked like a weak text full of optimistic wishes, unprepared for solving the problems or giving a chance to those who wanted to step up to the plate in the next phase. As a matter of fact, Erdoğan did not take it seriously from the start. Parties tried to find new allies or to strengthen existing ones, even if only for the short term. But the truth is that the arrow has come off the bow and internal peace is a remote chance in Syria. As a matter of course, fights will be “long standing” and mostly civilians – women and children – will suffer. Unfortunately, society will disintegrate rapidly by experiencing great traumas. Not only the balances in Syria that were established by force, but also the regional
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Yes, but not enough
Güven Sak, PhD
10 April 2012
The incentive system I was briefed about in Korea was thematic and had a spirit. Unfortunately, ours does not. The new incentive system for industrial investments has been announced. So, let’s discuss if the new incentive system is useful or not. The business world seems to be content with the system. Everyone is stressing how successful the new system is. In my consideration we have a “yes, but not enough” case here. I think that Turkey is not as successful as Korea yet. Let me tell you why I think that this is not enough.
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Output growth slows down as desired
Fatih Özatay, PhD
10 April 2012
Indicators suggest that industrial output growth has weakened and that this trend will most probably continue in March and April. Industrial output growth for February was announced. But first I want to talk about one “confusing” feature of industrial output growth figures. Generally, we assess industrial output with two methods. First, we make a year-on-year comparison, that is, assess the annual growth rates. Also, the Turkish Statistical Institute (TURKSTAT) has recently started to announce seasonally and working-day adjusted industrial output figures which allow month-on-month comparison.
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The New Investment Incentive Package and the Other Turkey
09 April 2012
The new investment incentive package was announced at the beginning of April. According to the initial reflections in the media, everyone is quite content with it. I would be too, if I was an investor here. It seems that the incentive experts of the Ministry of Economy have designed a smart incentive bill that will please investors as much as possible. I don’t think it would have been possible to satisfy this wide an array of demands and views from as many sectors more successfully. We have to congratulate the Ministry. So far so good. But can the new incentive package fulfill its aim of eliminating regional development disparities?
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Incentives
Fatih Özatay, PhD
07 April 2012
The main difference between the new and the old system is that the former incentivizes “strategic investments.” Last week I attended a conference at Uludağ University. During the session following the conference, some fellows explained how a one-paragraph amendment to the old incentive system affected the University. Here it goes: Around 150 engineers employed in an automobile company were working in the Technopolis in the University. The amendment to the incentive system cleared away the advantages of carrying out R&D activities in technopolises located in university campuses and encouraged carrying out such activities within factory premises. As a result, the engineers moved back to the factory. Which option is more beneficial concerning the economy is out of the scope of this commen
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I feel betrayed by the JOBS Act
Güven Sak, PhD
07 April 2012
I feel betrayed because in Turkey, we are trying to enhance our disclosure rules and make corporate accounts more transparent. Just a few days ago, U.S. President Barack Obama signed the “Jumpstart Our Business Startups Now” Act, known as the JOBS Act for short. I see a change here in the way we are looking at things, since the beginning of the financial crisis. The new legislation eases the financial reporting and audit requirements as well as securities markets compliance costs of small and medium size enterprises (SMEs). It is meant to ease access to securities markets for SMEs. Well, that’s some change.
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I felt at home in Moscow
Güven Sak, PhD
06 April 2012
If you asked me, “What did you think about Moscow?” I would say it is a bit from the past. The city has a glory inherited from the past. I do not know if this is about perceptual selectivity. I was in Moscow for one day at the beginning of this week. I saw references to Korea all around me. So I wanted to add another element to the Korea-Turkey comparison: The Koreans adhere strictly to Deng Xiaoping’s advice, “hide your brightness, bide your time,” not caring that he was Chinese and a communist. They work, not just talk. We, however, do not have time to take action as we are busy with telling people what we are planning to do. They identify which sector will be the coinage machine of the future and design huge programs accordingly. We not only just talk, but make people suspicious about o
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The battle was not over yet
Fatih Özatay, PhD
05 April 2012
Growth has been slowing down, which will ease the CPI. Yet, CPI realization will most probably be significantly above the CBT target. Thank God, high inflation rates are now an old story for Turkey. Compared to its own inflationist history, Turkey has been enjoying low inflation rates since the beginning of 2004. But please note that compared to its own history were the rates low. For example, go to the webpage of the Central Bank of Turkey (CBT). At the bottom of the homepage, you will see the annual CPI targets and realizations since 2002. The lowest and the highest CPI rates between 2004 and 2011 were 6.4 percent and 10.4 percent, respectively.
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