Turkey’s energy and automotive sectors are suffering from exorbitant debt and low demand, respectively, in the face of a continuing recession.
Turkey’s energy sector has $12-13 billion worth of loans that require restructuring, out of a total $70 billion total sector loans, lender Garanti Bank’s deputy general manager Ebru Edin said, according to Reuters.
Some of the loans that are in need of restructuring could pose an issue after the restructuring, Edin said, adding that the planned energy sector fund will be managed by a portfolio management company.
Garanti Bank, Turkey’s third largest bank by asset size, has financed several energy projects in Turkey. Some $23 billion of the sector’s total loans have already been paid, Edin said in a televised interview on Bloomberg HT.
Turkey is largely dependent to other countries for energy, and the national currency’s poor performance affects the sector directly.
The lira slid from 5.55 on April 3 to 5.98 on Friday against the US dollar.
Meanwhile, sales of passenger cars and light commercial vehicles in Turkey slid 56 percent year-on-year in April to 30,971 vehicles, the Automotive Distributors’ Association (ODD) said on Friday.
Sales dropped 48 percent in the first four months of the year, the association said, despite extended tax cuts by the government to encourage purchases.