Turkish firms, banks have no debt issues, Albayrak tells U.S. CEOs

Turkish Treasury and Finance Minister Berat Albayrak said the country’s banks and firms have no specific problems with debt.

While the debts of the Turkish private sector total about 65 percent of GDP, other emerging markets have debts of as much as 94 percent, Albayrak told representatives of the U.S. business world during a trip to New York, according to the state-run Anadolu news agency.

“When we add it all up, the Turkish public sector, people and private sector have no specific problem at all on the issue of debt,” he said.

Turkish companies have some $220 billion of unhedged long-term foreign currency loans, the central bank says. The borrowing has raised concern among investors that some firms will be unable to repay their dues after the lira dropped 40 percent against the dollar this year.

The government is taking a proactive approach to resolving the country’s economic problems and will provide support to banks if needed, Albayrak said.

Turkish banks have debts equivalent to 26 percent of GDP, also lower than global averages, Albayrak said. Meanwhile, the Turkish people refrain from borrowing in foreign currency because of the financial crises of the past, he said. Their borrowing totals about 16 percent of GDP compared with a global average of 60 percent, he said.