--------- AMP -----------
Sunday , November 18 2018

‘Kuwaiti investments in Turkey are stable’ – ‘Growth figures optimistic’

Deputy Foreign Minister Khaled Al-Jarallah

KUWAIT CITY, June 4: As the Turkish lira continues to fall to high records against the dollar on fears of the ability of the Turkish central bank to fight inflation Kuwait’s investments in Turkey are “under surveillance,” reports Al-Anba daily quoting a government source. The source added that the Kuwaiti investments in Turkey are estimated by about two billion dollars, more than 60 percent of them are owned by about 300 Kuwaiti companies with investments of $ 1.6 billion. He pointed out that about $ 400 million represent the Kuwaiti investments in Turkey owned by individuals. Those investments are varied but most of them are real estate investments.

The Kuwaiti official, who declined to be named due to the sensitivity of his position, said that despite the concern of many companies and individuals about their investments in Turkey after the decline of the Turkish lira, their investments are still at safe levels so far. He pointed out about 70 percent of the total Kuwaiti investments (companies and individuals) are in the real estate sector, which is strong in the face of major crises over the past 10 years, while the remaining 30 percent are diversified in shares and stocks in companies operating in different sectors such as clothing, food and mining. Turkey is seeking to cut borrowing costs to boost investment and stimulate the economy through a $34 billion stimulus package to help the Turkish companies.

According to official Turkish data, the volume of trade exchange between the two countries was about 1.2 billion dollars in 2016, amid expectations to reach $3 billion by 2020. The number of registered Kuwaiti ownership of Turkish real estate in 2010 was about 1,640 properties and about 6,000 properties in 2017. Kuwait is ranked 11th in terms of Turkish companies operating in Kuwait which carries out about 34 projects worth 6.5 billion dollars. In this context, Professor of Economics at the University of Kuwait, Dr Hassan Al-Saadi, said the Kuwaiti investments in Turkey are safe since most of them are in the real estate sector for the purpose of self consumption and therefore have no direct effect on them unless liquidating these properties and transferring them to liquid funds.

Dr Al-Saadi told the daily a majority of individual Kuwaiti purchases of real estate are based on ownership rights and are not based on indebtedness, considering that the purpose of buying is consumption and not investment. Dr Saadi sees that the reason behind the deterioration of the Turkish lira is a result of curtailment of the Turkish role and its ambitions, the matter that reflected negatively on the economy. The latest decline in the Turkish lira, which analysts called “historic,” came days after official data showed Turkey’s annual inflation rate was still above 10 percent. The looming trade war between the United States and China has exacerbated Turkish lira problems as Beijing plans to impose customs duties on more than 100 US products.

The recent Turkish statistical data showed that Kuwaitis ranked fourth after the Iraqis, Saudis and Iranians in terms of foreigners buying real estate in Turkey last April. According to data released by the Turkish Statistics Agency, Kuwaitis bought 116 properties in April and the Iraqis 337 properties. The Saudis bought 252 properties, the Iranians owned 138 properties and the Afghans 112. The Kuwaiti Deputy Foreign Minister Khalid Al-Jarallah on concerns about Kuwaiti investments in Turkey said, “No, we have no worries about our investments in Turkey, the situation there is still stable, and the growth figures achieved by the Turkish government are optimistic.”

Check Also

Seven pillars core Kuwait Vision 2035 – Kuwait plans $6.6bn industrial city

GOVERNMENT SHIFT FROM PLAYER TO FACILITATOR KUWAIT CITY, March 21: H.E. Khaled Al-Roudan, Minister of …

Translate »