Commentary: Turkey’s endemic corporate debt problem7 December 2019
Unbearable corporate debts which are burdening the balance sheets of banks and crimping growth and employment are Turkey’s best kept secret. Despite efforts to shift the debt burden to the shoulders of banks, the winter slowdown in the economy is causing a visible increase in bankruptcies, bankruptcy protection cases and down-sizing.
Ankara refuses to acknowledge the problem, hoping faster growth and extending the maturity of bad loans would solve it. It won’t. Turkey is slowly becoming a haven for zombie companies. Hope that they don’t bite the still healthy banking industry.