Apparently, Turkey is de facto in war against Russians and Syrians in Idlib. I really don’t know what I should write about what’s happening there under these saddening circumstances. But, I’ll try my best.
An event called “Wednesday Meetings” is held on every Wednesday of the month at Altınbaş University where Mahfi Eğilmez, Işın Çelebi and I are welcomed to join and talks about the latest economic developments throughout Turkey and the world. Last Wednesday, Nazlı Bolak gladly accepted to act as moderator for us due to Professor Eğilmez’s prior commitment to address a conference. This time the topic of the meeting topic was the impact of Coronavirus on the latest Brexit updates.
Let me offer a brief summary of our last meeting: There is a close relationship between the rise in global trade and GDP growth and the virus outbreak is deeply affecting the global trade, which poses a major risk to the world economy. As I have often mentioned in my commentaries for TV100, world GDP growth will decline only by 0.1 points is the outbreak ends in April, in which case, Turkish GDP growth will decrease by 0.5 points.
However, the global economy is expected to decline by .5 points, which is more than expected, in the event that the outbreak cannot be stopped until the end of the year. In such case, Turkey’s economy may fall below the target by at least a percentage of 5%. Before the Coronavirus outbreak, I had forecasted that Turkey’s economy would grow 4-5 percent by 2020. But, if the outbreak lasts until the year-end, our GDP growth rate may fall back to 2.5%.
Other than that, U.S. corporate debt is surging more than 50% while the low levels of interest rates mitigate some of the risks associated with high debt levels according to the World Bank. One in 5 US companies is a zombie at risk of default but they still don’t know it.
Here’s what I think about the Brexit: UK imports are worth USD 690 billion. Brexit will quite definitely impact EU and Turkey’s exports to UK in the most negative way. But I do believe that Turkish companies will find a way to sell goods to United Kingdom. That’s what the current figures show at least.
Işın Çelebi, on the other hand, spoke about even more catastrophic developments. According to Professor Çelebi, global weapons sales are hitting record highs while, or more accurately, as a result, regional conflicts keep growing. Interestingly, the incidence rate and the prevalence of disease outbreaks around the world are growing as well. In his speech, Çelebi has often raised the following question: “Is this the revival of the Cold War?”
About the Brexit, Işın Çelebi affirmed his belief that the UK leaving the EU will significantly improve UK economy over the next 5 years. He also added that he expects, over the upcoming period, Northern Ireland to join the Republic of Ireland in order to remain within the European Union.
“Over the next period, the European Union will cease to be a political union and become an economic union as it was supposed to be to begin with, and France and Germany will not be able to stop this transformation” I guess this statement of Çelebi was the one that struck me as the most interesting.
Believe me; I could barely hold my pen while I was trying to write down this article. But we all have our duties to fulfil. Listening to news about our young soldiers killed at some foreign land deeply affects us with sadness. May they rest in peace and love…
