Turkey threatens credit rating agencies
Turkey’s top leaders have threatened to cancel the contracts of credit rating agencies Fitch and Moody’s as financial markets get nervous at the prospect of Turkey being downgraded.
As the clock ticks for crucial reviews of the Turkish economy by major credit raters, the country’s top leaders are already fuming at the agencies. President Recep Tayyip Erdogan set the tone last week, targeting Fitch Ratings and Moody’s Investors Service.
“Turkey faces no risk of an economic crisis. The [agencies’] statements are politically motivated. They are void of any economic and scientific basis,” Erdogan told journalists on a flight back from Qatar. “They’ve done it before, and I severed ties with Standard & Poor’s. If they go on with this attitude, I’ll tell the prime minister to sever ties with them as well. We’ve gained nothing from them. We owe them nothing for where we stand today. Both you and I are aware of what’s going on behind the curtains.”
Prime Minister Ahmet Davutoglu followed suit. “The credit rating agencies are making incorrect assessments. They issue messages for the slightest of tensions,” he said. “We expect them to make objective assessments that don’t mislead the markets. Turkey won’t keep silent if they create an anticipation of a crisis through manipulative reports.”
And Deputy Prime Minister Ali Babacan, who is in charge of the economy, said, “Those agencies are trying to feel Turkey’s pulse with teams of two or three people. Meanwhile, there are many investors putting billions of dollars in Turkey. Most of them have their own assessment teams — 10 people, for instance, working in the field, meeting with hundreds of people and getting an in-depth understanding of the country. That’s how they make their decisions to invest. Hence, we expect rating agencies to work with larger teams and grasp Turkey’s realities through deeper analyses before deciding their grades.”
