2018年-IMF国际货币组织全球_Turkey_2018_Article_IV_Consultation_82页_2mb

IMF 2018 Article IV Consultation with Turkey Summary

Core Content

The IMF conducted a 2018 Article IV consultation with Turkey, which concluded on March 30, 2018. The consultation highlighted both the economic recovery and the underlying risks facing the country. The staff report, press release, and statement by the Executive Director for Turkey were released as part of the process.

Main Economic Developments

• Growth Recovery: After a slowdown in 2016, Turkey experienced a strong rebound in 2017, with real GDP growth averaging 7.4% year-on-year. This was driven by large fiscal stimulus, increased credit impulse, and a sharp rise in exports.
• Inflation and Imbalances: Inflation reached nearly 12% in 2017, well above the target. The economy showed signs of overheating, including a positive output gap, high inflation, and a current account deficit of over 5% of GDP.
• Fiscal and Quasi-Fiscal Policies: Fiscal policies became more expansionary, with the fiscal deficit increasing in 2017. This was due to temporary tax cuts, wage subsidies, and employment incentives. Contingent liabilities also rose due to high public-private partnership (PPP) activity and state loan guarantees.
• Monetary Policy: The central bank (CBRT) tightened monetary policy by increasing the effective cost of funding to banks by almost 500 basis points since November 2016. However, inflation remained high, and the real effective policy rate stayed close to zero.
• Financial Sector: Bank capital levels remained high, but some buffers were decreasing. The Credit Guarantee Fund (CGF) played a key role in boosting credit growth, but its impact waned by year-end. The headline non-performing loans (NPL) ratio remained low at 3%, but a broader definition of impaired loans suggested emerging weaknesses in loan quality.

Outlook and Risks

• Growth Projections: In 2018, economic activity is expected to decelerate to around 4.5% of GDP. Inflation is projected to remain above target, and the current account deficit is expected to stay elevated.
• Downside Risks: The medium-term outlook faces several risks, including:
  • Large external financing needs and limited foreign exchange reserves.
  • Increased dependence on short-term capital inflows.
  • Widening negative net international investment position (NIIP).
  • High corporate exposure to FX risk.
  • Potential for accelerating inflation if policy adjustments are inadequate.
  • Geopolitical tensions and domestic political uncertainty, especially ahead of the 2019 elections.
• Upside Risks: US dollar weakness and Euro strength could help reduce the burden of external debt servicing.

Policy Discussions

A. Monetary Policy

• The IMF recommended frontloaded monetary tightening to contain inflation, re-anchor expectations, and support the Lira.
• A shift to more conventional monetary instruments would improve transparency and effectiveness.
• Central bank independence was emphasized as crucial for maintaining credibility.

B. Fiscal Policy

• Fiscal and quasi-fiscal stimulus should be contained to avoid overburdening monetary policy.
• PPP activities need to be carefully managed and monitored.
• State loan guarantees should be gradually reduced to cases of clear market failure.
• Sustained measures are needed to achieve a general government primary surplus in 2018, including broadening the revenue base, improving VAT efficiency, and reducing public wage rigidities.

C. Financial Sector Policies

• The banking sector requires stronger oversight and governance, particularly in line with the FSAP recommendations.
• Macroprudential policies should be revisited, especially for the highly leveraged corporate sector.
• The Credit Guarantee Fund should be better targeted and its use limited to SME foreign currency borrowing.

D. Contingency Planning

• The IMF called for improved contingency planning to address potential external shocks and financial vulnerabilities.

E. Structural Reforms

• Structural reforms should focus on:
  • Increasing labor market flexibility to reduce unemployment and lower output costs of disinflation.
  • Strengthening the business climate to improve the composition of external inflows and rebuild buffers.
  • Reforming the voluntary pension system to increase domestic savings.
  • Promoting female labor force participation and addressing skills gaps.

Key Information

• Economic Context: Turkey's growth has outperformed its peers since the global crisis. However, recent expansionary policies have led to overheating and imbalances.
• External Position: Turkey's current account deficit widened to over 5% of GDP, and the real effective exchange rate depreciated by around 10%.
• Fiscal and Debt Risks: Public debt remains low, but contingent liabilities are rising. External debt is sustainable at 50% of GDP but sensitive to exchange rate and liquidity risks.
• Investor Sentiment: Turkish financial markets are sensitive to international investor sentiment, which was negatively impacted by the 2016 emerging market selloff.
• Refugee Integration: The authorities were commended for integrating a large number of refugees into the labor market.

Conclusion

The IMF acknowledged Turkey's strong economic performance but stressed the need for macroeconomic rebalancing, fiscal prudence, and structural reforms to address the overheating and build long-term resilience. The focus should be on reducing inflation, managing external risks, and improving the business and labor environments to support sustainable growth.