The gross debt stock of Turkey's central government in September increased by 18% y/y and 2.7% m/m to stand at TRY843bn (€195bn), the Turkish treasury said on October 20.
Annual debt growth in September was also the highest rate registered this year.
The Turkish government’s debt stock rose 12% y/y to TRY760bn by end-2016.
The domestic debt stock rose by 2% m/m to TRY524bn at the end of September, while the external debt stock expanded by 3.8% m/m to TRY319bn.
The government’s budget was stretched by a set of economic stimulus measures brought in during the build-up to the April 16 referendum that officially narrowly voted to bring in an executive presidency. The cumulative budget deficit rose by 163% y/y to TRY31.6bn across January-September.
The government’s central budget shortfall estimate for 2017 is 2% of GDP, or TRY61.7bn, according to the latest Medium Term Programme unveiled on September 27. Turkey’s budget deficit widened 25% to TRY29.3bn last year.
Fitch Ratings on July 21 affirmed its “junk” rating on Turkey's sovereign debt, citing political and regional geopolitical risks as well as the danger that economic stimulus measures could undermine its fiscal performance.
“Turkey's ratings balance high external financing vulnerabilities, pronounced political and geopolitical risks and high levels of inflation and macroeconomic volatility against low public debt ratios backed by a long commitment to fiscal stability and strong growth performance,” Fitch said in its July 21 statement.