High interest rates temporary: Turkish business head

By Sevgi Ceren Gokkoyun, Mustafa Calkaya and Mehtap Yilmaz

ANKARA (AA) - Turkish businesses will continue to invest in the country’s economy, the chairman of Ankara’s Chamber of Commerce said Monday.

Speaking at Anadolu Agency’s Economy Desk, Gursel Baran said, however, that making investments would not be sustainable with the current interest and inflation rates.

"Turkey managed it once and will do so again," he said, adding that he did not believe the interest rates would not be permanent at the current high level.

On Monday, the country's statistical authority reported that the annual inflation rate in February stood at 19.67 percent, down slightly from 20.35 percent in January.

Last October, the annual inflation rate saw its highest level over the past decade, hitting 25.24 percent.

The Central Bank’s policy rate -- its one-week repo rate -- is 24 percent, as the bank will announce its decision on interest rates next Wednesday.

In 2018, interest rates climbed from 8 percent to 24 percent over the course of one year.

Commenting on the coming municipal elections on March 31, Baran said the Turkish economy would not see any troubles after the elections.

Underlining that the Turkish economy was being subjected to idle speculations which he suggested may originate from outside the country.

"Turkey is one of the world's most important countries, and has characteristic features," he said.

Baran noted that the country would continue to work decisively to achieve its long-term targets, adding that hitherto frequent elections would enter a hiatus after March 31.

"I certainly believe that, after fulfilling our roles, Turkey will be among the world's top 10 economies by 2023 [the country's centennial], as President Erdogan says," he said.

Highlighting the recent incentive package to increase employment, Baran said the new campaign boosted morale in the real sector.

According to an official campaign launched last week, the government will pay salaries, taxes and premiums of every new personnel employed by businesses for three months.

Pointing out that hundreds of international flights took off from Istanbul every day, Baran said: "From the capital Ankara, there are only 29 direct flights to 17 countries, and this is not enough."

"Currently, direct flights from Ankara have a seat occupancy rate of 85 percent," he added.

"We ask Turkish Airlines to starts direct flights from Ankara to the U.S., China and the Far East," he said.

Baran also said their efforts will continue to make Ankara an important transfer destination for international flights.

* With writing and contributions by Muhammed Ali Gurtas