While everyone seems focused on the prospects of the emergence of China as one of the world's top economic and political behemoth, one interesting headline that caught my eye is ``Turkey Overtaking Germany No Wishful Thinking on Paradigm Shift"
This from Bloomberg, (all bold emphasis mine)
``Erda Gercek spent 20 years outside Turkey, identifying stock market winners as a fund manager at Citigroup Inc. and Legg Mason Inc. Now he has moved back to his homeland, saying it’s a buy.
“In the time I was away, Turkey went from a highly volatile, boom-and-bust economy to one that’s relatively stable as inflation and interest rates came down,” Gercek, 44, said in an interview from Izmir, south of Istanbul. He said he’s “nurturing future talent,” teaching courses in fund management at Istanbul’s Bilgi University and Izmir Economy University. ``The paradigm shift, as market strategist John Lomax of HSBC Holdings Plc calls it, was engineered by a government that the military and prosecutors say is trying to turn Turkey into an Islamic state. As Prime Minister Recep Tayyip Erdogan fought off pressure from secularist generals who ousted four governments since 1960 and also a lawsuit to shut his party, he reined in government spending, sold state-owned companies and crisscrossed the region to open trade doors for Turkish business."
``The payoff has been average economic growth of 4.4 percent since he was first elected in 2002. Gross domestic product increased at an annual rate of 6 percent in the fourth quarter of 2009, lagging behind only China among the Group of 20 nations, the government said last week. Deputy Prime Minister Ali Babacan said April 2 the economy may have expanded by more than 10 percent in the first quarter.
``Turkey’s $620-billion economy could move ahead of Germany’s to become the third-biggest in Europe by 2050, behind Russia and the U.K., Goldman Sachs Group Inc. economist Ahmet Akarli wrote in a report published in 2008."
Again we see the same source of bullishness, Turkey has essentially been embracing economic freedom.
Turkey is currently ranked 67th in the 2010 Index of Economic Freedom by the Heritage Foundation and has manifested continuing interests to adapt openness since 2004 (shown below-courtesy of heritage).
More from Bloomberg...
``It’s the youth of Turkey’s 73 million people that drives much of the optimism. More than a quarter are under 15 years old and 6.3 percent are over 65, according to the 2009 census. In the U.S., 19 percent are under 15 and over-65s make up 13 percent of the 316 million population, data compiled by Bloomberg show.
``Turkey is also younger than China, where 19 percent of 1.4 billion people are under 15 and 8.4 percent over 65. In countries that share the euro, 17.5 percent are over 65 and 16 percent are under 15.
``Turkey’s demographics “can sustain very high levels of growth,” and there’s “ample potential” to put more young people to work in industries that are more productive, Gercek said. Sustaining 6 percent growth “seems to me to be perfectly achievable,” he said."
So economic freedom looks likely to convert Turkey's demographic trends as a key favorable critical factor for her economy.
Read the rest here
As for Turkey's potential to overtake Germany-that actually depends if current conditions will be sustained or improved. Nevertheless, Turkey should be a good recruit for the European Union.
This from Bloomberg, (all bold emphasis mine)
``Erda Gercek spent 20 years outside Turkey, identifying stock market winners as a fund manager at Citigroup Inc. and Legg Mason Inc. Now he has moved back to his homeland, saying it’s a buy.
“In the time I was away, Turkey went from a highly volatile, boom-and-bust economy to one that’s relatively stable as inflation and interest rates came down,” Gercek, 44, said in an interview from Izmir, south of Istanbul. He said he’s “nurturing future talent,” teaching courses in fund management at Istanbul’s Bilgi University and Izmir Economy University. ``The paradigm shift, as market strategist John Lomax of HSBC Holdings Plc calls it, was engineered by a government that the military and prosecutors say is trying to turn Turkey into an Islamic state. As Prime Minister Recep Tayyip Erdogan fought off pressure from secularist generals who ousted four governments since 1960 and also a lawsuit to shut his party, he reined in government spending, sold state-owned companies and crisscrossed the region to open trade doors for Turkish business."
``The payoff has been average economic growth of 4.4 percent since he was first elected in 2002. Gross domestic product increased at an annual rate of 6 percent in the fourth quarter of 2009, lagging behind only China among the Group of 20 nations, the government said last week. Deputy Prime Minister Ali Babacan said April 2 the economy may have expanded by more than 10 percent in the first quarter.
``Turkey’s $620-billion economy could move ahead of Germany’s to become the third-biggest in Europe by 2050, behind Russia and the U.K., Goldman Sachs Group Inc. economist Ahmet Akarli wrote in a report published in 2008."
Again we see the same source of bullishness, Turkey has essentially been embracing economic freedom.
Turkey is currently ranked 67th in the 2010 Index of Economic Freedom by the Heritage Foundation and has manifested continuing interests to adapt openness since 2004 (shown below-courtesy of heritage).
More from Bloomberg...
``It’s the youth of Turkey’s 73 million people that drives much of the optimism. More than a quarter are under 15 years old and 6.3 percent are over 65, according to the 2009 census. In the U.S., 19 percent are under 15 and over-65s make up 13 percent of the 316 million population, data compiled by Bloomberg show.
``Turkey is also younger than China, where 19 percent of 1.4 billion people are under 15 and 8.4 percent over 65. In countries that share the euro, 17.5 percent are over 65 and 16 percent are under 15.
``Turkey’s demographics “can sustain very high levels of growth,” and there’s “ample potential” to put more young people to work in industries that are more productive, Gercek said. Sustaining 6 percent growth “seems to me to be perfectly achievable,” he said."
So economic freedom looks likely to convert Turkey's demographic trends as a key favorable critical factor for her economy.
Read the rest here
As for Turkey's potential to overtake Germany-that actually depends if current conditions will be sustained or improved. Nevertheless, Turkey should be a good recruit for the European Union.
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