ANKARA: Turkish banks should continue to support any company that shows the “slightest sign of life”, Deputy Prime Minister Nurettin Canikli said, as part of a $65 billion loan guarantee programme aimed at reviving struggling firms. Canikli’s comments at the Turkish Union of Chambers and Commodity Exchanges on Wednesday evening highlight the government’s drive to use credit to boost the flagging economy. President Tayyip Erdogan, who has described himself as an “enemy” of interest rates, has called on banks to keep lending or face reckoning.
The government said in December it would guarantee 250 billion lira ($65 billion) in loans to help struggling firms. So far, there have been requests for 40 billion lira of funding through the programme, Canikli said. “We said to banks that they should definitely give support to any company which has the slightest sign of life to get it back on its feet. The initiative here is with us not the bank. There is no risk to banks.” “The Treasury is giving a guarantee. If there is a problem despite all this we will intervene immediately,” he said. Investors are not as optimistic. A Reuters poll this month suggested that economic growth will fall well short of government targets in the three years to 2018, underscoring widening concern about what was once one of the world’s most promising emerging markets.
