U.S. Official Highlight's Turkey's Economic Progress

Oil pipeline "catapulted" Turkey into energy markets, historic inflation tamed

Turkey is making difficult but necessary economic choices that have led to "unprecedented growth, low inflation and stability" while also assuming a position of major importance in the energy sector, a senior State Department official says.

E. Anthony Wayne, assistant secretary of state for economic and business affairs, addressed the American Turkish Council Conference on March 28 in Washington.

The United States wants to work with Turkey to "shape ... a future in which Turkey plays an ever increasing role in regional peace, stability and prosperity, in which Turkey is both anchored in Europe and a bridge to the East," Wayne said in remarks released April 3.

Progress in the past 12 months includes the opening of talks to join the European Union, Wayne said. Turkey also stands to prosper from the December 2005 opening of the Baku-Tiblisi-Ceyhan (BTC) pipeline, which brings oil from Azerbaijan through Georgia to Turkey's Mediterranean port of Ceyhan. One of the many goals of the pipeline is relieving a bottleneck of oil shipping through the Bosporus, where in the winter of 2003-2004 oil tankers were backed up 30 days or longer.

"Turkey overnight has been catapulted into world attention as the crucial link between Caspian Basin and Central Asian energy reserves and European and world markets," Wayne said.

Inflation in Turkey has gone from a high of 70 percent in 2002 to below 8 percent at the end of 2005, Wayne said. At the same time, real gross domestic product grew by nearly 8 percent in 2004 and 5 percent in 2005.

Turkey in 2005 posted $9.6 billion of major foreign direct investment (FDI) after years of attracting very low FDI levels, Wayne said. He encouraged Turkey to "further spur investment by eliminating policies that discourage investment." For example, Pepsi, Coca-Cola and other major U.S. soft drink companies have invested more than $500 million in Turkey and have created more than 7,000 jobs since 2000, despite "discriminatory 'cola taxes'" as high as 47.5 percent, Wayne said.

Source: U.S. Department of State

judythpiazza@gmail.com

   _   _