The international rating agency S&P Global Ratings has upgraded Turkey’s long-term foreign and local currency ratings to “B+” from “B”.
The ratings outlook is “positive,” according to a press release from S&P.
“We expect that following the municipal elections held in the country, the Turkish authorities will continue to fight inflation aggressively through tightening monetary policy and gradual fiscal consolidation,” the agency’s experts say.
S&P predicts a decline in Turkey’s current account deficit over the next two years, along with weakening inflation and slowing dollarization of the economy. At the same time, the agency’s analysts believe that the country’s inflation rate will remain double-digit until early 2028.
The Central Bank of Turkey is likely to keep the key interest rate at the current level of 50% until the end of 2024, according to S&P.
“We could upgrade Turkey’s rating again if the country’s balance of payments continues to improve, inflation slows, and domestic savings in Turkish lira increase, allowing the country to rebuild its foreign exchange reserves,” the agency said in a press release.
S&P may change the outlook on Turkey’s ratings to stable if pressure on the country’s financial stability or state budget increases, for example, if the lira’s depreciation fails to stop, or if the authorities abandon inflation control measures.
Earlier, Experts Club and Maksim Urakin released a detailed video analysis of how economic and political life is developing in Turkey, more detailed video analysis is available here – https://youtu.be/SUqOMFI5HbI?si=uEIZZOORj65VElUQ
You can subscribe to the Experts Club YouTube channel here – https://www.youtube.com/@ExpertsClub
Contrary to forecasts, Ukrainian corn has started to rise in price on world markets due to increased demand from China, Turkey, Egypt and the European Union, according to the analytical cooperative “Pusk”, created within the framework of the All-Ukrainian Agrarian Council (AAC).
“The expectations of the trade that with the arrival of a new corn crop from Argentina on the world market, demand and prices for Ukrainian grain would fall, did not materialize. Argentine new crop is sold at higher prices than Ukrainian corn. We can predict a rise in prices for corn from Ukraine in the coming weeks,” the analysts said.
According to them, China is actively contracting Ukrainian corn. Other importers, such as Turkey, Egypt, Italy, and Spain, have also started buying a lot of Ukrainian corn. In seaports, the conditional prices for it have risen to $142-145/ton and have been increasing for a week and a half. The supply is sinking, while demand is stable.
“It can be predicted that amid demand, prices will add $2-3 per tonne per week and reach at least $150/tonne on a CPT basis by the end of March,” the experts emphasized.
They said that in April, the main factor of corn price changes will be the information on the grain harvest in Brazil. In April, there will be more reliable information about the harvest in Brazil: the planted areas, soil moisture, and crop condition. This will affect the global market. If the drought continues in Brazil and the harvest is reduced, the price will rise. But for now, this is one of the scenarios. In case of rainfall in Brazil, the situation on the global corn market will be different.
On a DAP basis, Ukrainian corn is traded for delivery in March-April to Italy, Austria and Germany in the range of $192-197/ton, Pusk summarized.
An agreement between the Government of Ukraine and the Government of Turkey on the establishment of a system for the electronic exchange of preliminary information on goods and vehicles moving between the parties was signed in Istanbul on Friday as part of a meeting between President of Ukraine Volodymyr Zelenskyy and President of Turkey Recep Tayyip Erdogan.
“According to the document, information exchange will be carried out between the State Customs Service of Ukraine and the Ministry of Trade of Turkey. Based on the agreement, a system of electronic exchange of preliminary information will be created, through which a predetermined set of data will be exchanged in electronic form,” the press service of the President of Ukraine reports.
It is noted that the information received by the customs authorities of the parties will help speed up the movement of goods and vehicles across the borders of both states, as well as counteract customs offenses.
On behalf of Ukraine, the agreement was signed by Defense Minister Rustem Umerov, and on behalf of Turkey – by Trade Minister Omer Bolat.
Ukraine’s Ministry of Communities, Territories and Infrastructure Development has agreed with Turkey’s Ministry of Transport and Infrastructure to extend the liberalization of freight transport, the ministry’s press service said on Thursday. According to the ministry, the “transport visa-free zone” or liberalization of freight transport with Turkey, includes bilateral freight traffic and transit traffic, the ministry said.
“Of all the exports we deliver to Turkey, about 15% are by road transport. Turkish companies import to us exactly by road transport almost 60% of the total volume of goods,” said Deputy Prime Minister for Reconstruction – Minister of Community Development, Territories and Infrastructure Alexander Kubrakov.
As a result of the agreement, the parties no longer need permits for cargo and transit transportation. At the same time, permit-free passage is also valid for the entry of empty trucks.
In addition, the Ministry of Transport agreed with the Turkish side to increase the number of permits for cargo transportation to/from third countries and bus transportation to 3,500 permits and 400 permits, respectively.
“We are working on the possibilities of performing irregular bus transportation – we have agreed on 400 permits for such trips. In the near future, part of these permits will be delivered to Ukraine for issuance to carriers,” – emphasized Deputy Minister of development of communities, territories and infrastructure Sergiy Derkach.
As reported, liberalization of freight transport is available with 35 countries, including the European Union. Last year, the team of the Ministry of Recovery managed to agree on the possibility with Norway, North Macedonia and extend the relevant agreement with Moldova.
The Forum for the Reconstruction of Ukraine is taking place in Istanbul. It began with a meeting between Turkish Trade Minister Omer Bolat and Minister of Transport and Infrastructure Abdulkadir Uraloglu and Vice Prime Minister of Ukraine Oleksandr Kubrakov.
“We held fruitful meetings with Omer Bolat and Abdulkadir Uraloglu, who organized the Ukraine Reconstruction Forum, an initiative that promotes cooperation in the recovery and development of the affected regions. This demonstrates a strong commitment,” Kubrakov wrote on social network X.
He noted that the forum will help increase the trade potential of the countries, expand logistics and foreign economic relations.
“We have a common goal: The Black Sea should become a zone of cooperation, trade and economic growth. It is important to attract private investment in infrastructure rehabilitation. This year, projects aimed at restoring energy, housing, critical and social infrastructure are prioritized,” Kubrakov said.
The Turkish Minister of Trade, for his part, emphasized that the experience gained from successful projects implemented by Turkish contractors in different regions of the world to date will become a cornerstone of cooperation between the two countries, especially in the reconstruction of Ukraine.
“In addition, together with Kubrakov, we have made important assessments of increasing the volume of mutual trade and strengthening economic relations between the two countries,” he wrote in X.
Turkey, Romania, and Bulgaria will sign a joint agreement in January 2024 to counter the mine threat in the Black Sea, Turkish National Defense Minister Yashar Güler said, TRTHaber reported on Saturday, December 16.
“Within the framework of the Trilateral Initiative, launched under the leadership of our country against the mine threat in the Black Sea, on November 22-23, we held the third round of the meeting of the Task Force on Mine Action in the Black Sea, hosted by our ministry. We are also planning to hold a signing ceremony in Istanbul on January 11, 2024, with the participation of the defense ministers of the three countries,” said Yasar Güler.
The minister emphasized that Turkey responsibly and impartially implements the Montreux Straits Convention, which ensures balance in the Black Sea, and is determined to continue to do so.
