Turkey Country Report Mar21 - March, 2021

March 3, 2021

Erdogan cut the Biden administration’s comb over the PKK. Now, he will play them like a fiddle.

Erdogan is smarter than all of them when it comes to playing issues off against each other and the sense is clearly that he’ll wangle a role in the Biden world without having to give much away when it comes to annoyances such as democracy.

However, his base at home is sliding under his feet due to growing hunger. Domestic politics and social reactions will be Erdogan’s main trouble in the coming period.

Stakes in official GDP growth release for 2020 rose to about 2.5%. Even a higher figure may be released. 5% for Q1 2021 is in the making.

It seems that the central bank will not come up with a surprise at the next rate-setting meeting on March 18, but the policy rate will not remain at 17% after the June 17 meeting. April 15 and May 6 are the other rate-setting meeting dates, and an early attempt will not be a surprise. All expectations are based on the current conditions and it should not be overlooked that a sharp depreciation in lira or some political development may shift the scene to the opposite direction.

In the last week of February, Turkish markets crashed due to sharp sell-off in EM assets.

In February, foreigners sold Borsa Istanbul equities while they bought domestic government bonds. If the policy rate is cut in the coming period, investors in domestic government bonds will write profits, but USD-basis returns will depend on a possible lira depreciation that would follow the rate cut under normal conditions.

Akbank was ‘in the market to renew a $604mn syndicated loan at 100% rollover rate’.

Oil-indexed prices in Turkey’s natural gas import contracts are on track to increase considerably in Q2 compared to Q1.

Expressions of interest (EoI) applications in the second round of the risk sharing mechanism (RSM) for geothermal resource validation in Turkey will be collected by March 5.

Rent-a-car app Yolcu360 topped Deloitte Technology Fast 50 Turkey 2020 ranking.

2020 financials and dividend plans season at Borsa Istanbul is progressing. Deadline to submit 2020 financials stands for March 11.

Global Liman will on March 26 hold a meeting with bondholders to restructure $250mn of 6-year eurobonds (XS1132825099) due November 14.

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