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After the Crisis: Mitigating Risks of Macroeconomic Instability in Turkey

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  • Łukasz Rawdanowicz

    (OECD)

Abstract

Turkey is recovering from a severe recession. Once growth gains full speed, the authorities will likely face the challenge of widening external imbalances and of ensuring a smooth functioning of the financial markets. The former will require improving competitiveness, raising domestic saving, attracting more FDI inflows and reducing energy import dependency. Improvements in many of these areas will depend on structural reforms in the labour and product markets. Financial market stability calls for adopting international standards of prudential regulations and reacting pre-emptively to new developments in the financial markets. Mitigating risks of macroeconomic instability will be crucial for embarking on a stable and strong growth path to generate sustainable convergence with the OECD average income level. This paper relates to the 2010 OECD Economic Review of Turkey (www.oecd.org/eco/surveys/turkey). Après la crise : Réduire les risques d'instabilité macroéconomique en Turquie La Turquie se remet de sa récession la plus grave depuis plusieurs décennies. Quand la croissance prendra son plein essor, les autorités devront faire face au défi de l'élargissement des déséquilibres extérieurs et d'assurer un bon fonctionnement des marchés financiers. Concernant le premier défi, il faudra améliorer la compétitivité, augmenter l'épargne nationale, attirer davantage d'investissement direct étranger et réduire la dépendance vis-à-vis des importations d'énergie. Des améliorations dans plusieurs de ces domaines dépendront de réformes structurelles dans les marchés du travail et des produits. La stabilité des marchés financiers requiert l'adoption des normes internationales de réglementation prudentielle et des initiatives à titre préventif pour faire face aux nouveaux développements dans les marchés financiers. Atténuer les risques d'instabilité macroéconomique sera crucial pour embarquer sur un sentier stable et solide de croissance pour rattraper le niveau de revenu moyen des pays de l’OCDE. Ce document se rapporte à l’Étude économique de Turquie de l’OCDE, 2010, (www.oecd.org/eco/etudes/turquie).

Suggested Citation

  • Łukasz Rawdanowicz, 2010. "After the Crisis: Mitigating Risks of Macroeconomic Instability in Turkey," OECD Economics Department Working Papers 820, OECD Publishing.
  • Handle: RePEc:oec:ecoaaa:820-en
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    File URL: http://dx.doi.org/10.1787/5km36j745fbt-en
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    Keywords

    competitiveness; compétitivité; current account deficit; déficit du compte courant; dépendance énergétique; energy import dependence; FDI; financial supervision; investissement direct étranger; modèle de commerce; saving; surveillance financière; trade model; Turkey; Turquie; épargne;

    JEL classification:

    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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