Credit Guarantee Fund: Will It Juice Economy?
Turkish government introduced a new facility so-called ‘Credit Guarantee Fund’ a couple of months ago to boost the economic activity by spurring lending to small and medium size enterprises where majority of the country’s workforce is employed. As is Clear from its name, this is typically a system of state-guaranteed lending in which the government provides TRY25 billion in cash with the aim of creating a lending base of TRY250 billion with a leverage of 1:10. The guarantee will be...
The Impact of Credit on Turkey’s Growth
Credit impulse is an economic measure first introduced by Deustche Bank economist Michael Biggs. It is simply the change in new credit issued as a percentage of GDP. The conventional method measure used when associating developments in credit with developments in domestic demand is credit growth which actually is the growth in the stock of credit. But one should consider that domestic demand depends on the amount borrowed in a particular period, or the flow of credit. If this...