With the release of the International Monetary Fund’s (IMF)’s report on the fourth and fifth review for Turkey’s standby agreement, the state of the country’s finances has come under fresh scrutiny from market observers, with ongoing concern over the size of the current account (CA) deficit. Strong economic growth coupled with high oil prices has helped account for growing debt over recent months, according to the report, but alarmism would be misplaced following closer inspection of the CA issue and overall resilience of the economy, say local analysts. Current account deficit causing concern The size of the current account deficit is nonetheless causing concern, with analysts expecting a whopping $31 billion in early 2007. Yet, Turkey’s success at enduring the global run on emerging market economies in May and June 2006 was notable, thanks to such macroeconomic buffers as the floating exchange rate, the independence of the central bank, a
