Turkey

#Turkey sees inflow of angel investments surge 66% in 2019

Turkey saw $102 million worth of angel investments come into the country in 2019, a 66% year-on-year increase, amid efforts to improve venture capital and angel investment fields in the country. Turkey is the fourth largest angel investment country in Europe with 141 angel investors. The two-day congress on angel investment hosts hundreds of participants from 92 countries and 132 international speakers in 24 panels. As part of the WBAF's World Congress 2020, agreements were signed with the Mali government, the Mexican Foreign Affairs Ministry, the Royal Academy of Science International Trust, the Antalya OIS and the Antalya Technopark, the Three Cultures Foundation, the World Free Zones Association, the World Association of Women Entrepreneurs and Bahrain Entrepreneurs Organization.

Turkish Islamic banking set for fast growth after slow start

According to Moody's Investors Service, Turkey's Islamic banking assets are set to double within 10 years from a low level as government initiatives drive growth in the sector. Turkey's Islamic finance sector currently is smaller than other large Muslim countries. The main reason is the relatively small number of Islamic banks and their limited distribution networks within Turkey. Islamic banks are called participation banks in Turkey and are regulated by the Banking Regulation and Supervision Agency (BRSA). They are required by law to become a member of the Participation Banks Association of Turkey (PBAT). Between 2014 and 2015 the Turkish government established two new state-owned participation banks and a new one in 2019. Turkey's ambition is to establish Istanbul as a global financial center. It aims to raise the share of financial services in Turkish GDP to 6% by 2023 from 3% at the end of 2018.

#Turkey's Islamic banking assets expected to double in 10 years - Moody's

According to Moody's Investors Service, Turkey's Islamic banking assets are expected to double in the following 10 years as a result of government initiatives and new regulation that push the sector's expansion. With just over 5.8% of banking assets at the end of September, Turkey's Islamic finance sector is currently smaller than other large Muslim countries. Evolving regulation and supervision, as well as plans to equalise tax treatment for equivalent financial activities of commercial and Islamic finance institutions are expected to boost the sector. Turkey established three new state-owned Islamic banks from 2015 to 2019. Furthermore, the state-funded $2.6 billion (2.36 billion euro) International Financial Centre in Istanbul (IIFC) is scheduled to open in 2023.

AAOIFI partners with Turkish Islamic banks to promote Islamic finance

The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) has signed an MOU with the Participation Banks Association of Turkey (TKBB) to collaborate in the promotion of Islamic finance in Turkey. AAOIFI and TKBB agreed to work in areas of common interest, such as the meaningful exchange of information and conducting joint capacity-building programmes. Osman Akyüz, the Secretary General of TKBB, said that they would also focus on increased representation of Turkish experts in AAOIFI’s boards and committees. AAOIFI Secretary-General Omar Mustafa Ansari emphasized the role of TKBB for the growth of Islamic finance in Turkey and assured the full support of their initiatives and activities.

Don't believe media buzz about Arab buying spree in #Turkey

Turkey has been talking a lot about Arab purchases in the country. Most recently, the issue of Arab acquisitions has made headlines as part of a simmering controversy over a government plan to build an artificial waterway in Istanbul as an alternative to the Bosporus. Sheikha Moza bint Nasser, the mother of the Qatari emir, is among the buyers who have reportedly purchased 4.4 hectares of land in the area. While real estate sales to foreigners account for less than 3% of Turkey’s export revenues, Gulf investors hold only 9% of direct foreign investments in the country. In sum, any media buzz suggesting an Arab buying spree in Turkey is overblown.

Experts say the odds are against gold dinar

Prime Minister Dr Mahathir Mohamad brought an idea of a gold dinar as an international reserve currency for Muslim countries in preference to the US dollar as the dollar was sometimes unstable. Nazari Ismail, a professor of economics at Universiti Malaya thinks, that the idea is not reliable, as countries as Saudi Arabia, Qatar, Pakistan and Indonesia would be not interested in the prime ministers proposal.

Leaders call for use of alternative currency among Muslim countries against US Dollar

At the ongoing Kuala Lumpur Summit 2019, leaders of the Muslim world have pressed for alternative currency for use in trade and seek independence from US Dollar. Turkish President Recep Tayyip Erdogan said Muslim countries should try to create new transaction systems. He added that Islamic finance needs to be part of the agenda just like in Malaysia. Meanwhile, Iran's President Hassan Rouhani was of the view that Muslim nations should come up with a new own cryptocurrency. Malaysia's Prime Minister Tun Dr Mahathir Mohamad also believes that a united cryptocurrency is needed for Muslim states, as a cryptocurrency can cut through bureaucratic and market fluctuations. He added that utilising cryptocurrency or national currency would help attain independence from over-reliance on the US dollar.

#Qatar reaches out to Shariah market in #Malaysia, #Turkey

Qatar has taken the lead in reaching out to Malaysia and Turkey through which the country aims to be the dominant player in the global Shariah financial landscape. Under the proposed plan, Turkey would cover Islamic finance needs in Europe, Qatar would serve the greater Middle East and North Africa and Malaysia will continue to serve the Asian markets. The London Stock Exchange is currently a global venue for the issuance of sukuk, while Hong Kong and Luxembourg have also made inroads but Qatar believes the market should be led by Muslim countries. Qatar Financial Center (QFC) Authority CEO Yousuf Mohamed al-Jaida has a vision to cover the entire globe’s Islamic financial transactions between three financial centres, Doha, Istanbul and Malaysia, therefore he sees a need to share platforms and technology.

#Turkey, #Malaysia, #Qatar can pioneer in Islamic finance

Ready to be taken to the next level, the burgeoning sector of Islamic finance is ready to take root in new regions through Turkey, Malaysia and Qatar. According to Yousuf Al-Jaida, CEO of the Qatar Financial Centre, Malaysia could act as a gateway for Islamic finance into Asia, with Turkey into Europe and Qatar the Middle East and Africa. He stressed that Malaysia was ready with its legal framework to facilitate the sector, while Qatar and Turkey need to step up and do more for the sector. Al-Jaida said these three countries could form a large platform to share experience, technology and knowledge. He is optimistic and sees a bright future, as Islamic finance is now growing at an even quicker pace than conventional finance.

#Turkeys unexpected rise to the top of global crypto adopter

When thinking of countries that are ahead of the curve in crypto adoption, Turkey might not be the first place that springs to mind. However, Turkey has undoubtedly become a crypto giant, and with President Recep Tayyip Erdogan recently announcing that testing of the digital lira is to be finalized in 2020, crypto is destined to become even more popular. While the country’s government was initially reluctant to embrace cryptocurrencies, the people had always found utility in it. The online payment sector in Turkey had been ready to adopt crypto, but the first opportunity only came when PayPal was banned in the country. Turkey’s Ministry of Industry and Technology announced plans to establish a national blockchain infrastructure. Turkey has a vision of making Istanbul a financial center, and all institutions are working toward that end.

Albaraka Turk issues TRL 600 million dual-tranche #Sukuk

Albaraka Turk Katilim Bankasi has issued TRL 600 million dual-tranche Sukuk through its subsidiary Bereket Varl?k Kiralama Sirketi. While the targeted total amount of the issuance was TRL 450 million, the total amount reached TRL 600 million. The certificates had two different tenors as 98 days and 147 days and the size of each tranche was TRL 450 million and TRL 150 million respectively. Malek K. Temsah, Albaraka Turk’s Assistant General Manager of Treasury, said that the uniqueness of this transaction was in its dual-tenured nature, which offered investors additional flexibility.

MICROFINANCE PAPER WRAP-UP: “Analysis of the Strategy of #Microfinance for Financial Inclusion of Refugees,” published by the European Microfinance Network

Turkey is host to an estimated 4 million refugees, more than are living in any other country. This paper assesses “the feasibility of microfinance as an appropriate strategy for the financial inclusion of refugees in Turkey.” The authors identify some of the risks of lending to refugee populations and steps that can be taken to mitigate them. Borrowed funds may be used for unapproved purposes such as to repay other debts. This may be mitigated by visiting the borrower’s place of work to assess how the credit is to be used. Excluding local residents from lending programs can create resentment. This may be mitigated by issuing loans to groups whose members span both the local and refugee populations. Refugees may move away, making recovery of loan repayments more challenging. This can be mitigated by assessing a loan applicant’s level of integration into the local community.

KFH-Turkey... Robust Financial Position, Very High Liquidity Ratios

Group Chief Executive Officer at Kuwait Finance House(KFH), Mazin Saad Al-Nahedh, emphasized that KFH-Turkey enjoys robust financial position and very strong liquidity ratios as per the regulatory authority’s requirements in Turkey and Kuwait, not to mention as per the international standard Basel III.

Istanbul to host refugee economic inclusion conference

Istanbul is hosting a two-day conference to discuss the economic inclusion of young refugees in their host communities. The conference is set to bring together more than 150 stakeholders from the MENA region, policymakers, international and national NGOs, private sector, academia, and entrepreneurs. Participants will discuss various methods for enhancing economic inclusion of refugees and host communities in the Middle East and North Africa (MENA) region. The two-day program will be held in partnership between the Dutch International NGO Spark and Islamic Development Bank (IsDB), with the Islamic Solidarity Fund for Development (ISFD) and the Dutch Ministry of Foreign Affairs as sponsors.

#Turkey's Takasbank reveals blockchain platform to transfer gold

Turkey’s Takasbank launched its blockchain-based electronic platform for trading gold called BiGA. The project aims to enable people to transfer physical gold stored at the Borsa Istanbul Stock Exchange via digitized gold units on a blockchain. Although the units will have the same form and function as physically backed stablecoins, their value will be tied to the traded goal. The bank will provide users with a wallet to store the tokens, and BiGA can eventually be used as an e-commerce payment option. Notably, the word “BiGA” is the Turkish abbreviation for one gram of gold. Earlier this week, New York-based Paxos Trust Company has launched PAX Gold, a gold-backed Ethereum token, with approval from the New York State Department of Finance Services. One PAXG token will be supported by one fine troy ounce of London Good Delivery gold stored in professional vault facilities in London.

Istanbul meet discusses development challenges

The Islamic Development Bank (IsDB), the Islamic Solidarity Fund for Development (ISFD) and the United Nations Development Program (UNDP) have organised a two-day meeting in Istanbul. Several managers from organizer institutions are giving speeches on many issues such as saving children, poverty in Africa, socio-economic issues, Islamic and alternative finance, innovation and blockchain opportunities and partnership with the private sector. Gerd Trogemann, the manager of UNDP's Istanbul Regional Hub, stressed that all partners have to work together for bringing solutions to development challenges. The partners should go beyond organizational borders and build networks and platforms of partnerships, as each partner has different levels of reach, approaches and solutions.

#Turkey: Islamic economy institute to hold int'l studies

Turkey's first institute on Islamic economy and finance aims to conduct international academic studies in Istanbul. University president Erol Ozvar said the Marmara University Institute of Islamic Economics And Finance (MUISEF) will expand its studies with further academic research. MUISEF is the first of its kind in Turkey in terms of being an academic institute. Ozvar added that the instruction language will be in English and will provide training on Islamic economy and finance for graduate and doctoral students coming from different disciplines. The institute was established under a joint protocol with the Finance Office of the Turkish Presidency and serves the purpose of making Istanbul a "finance center".

Scientific heritage of Fuat Sezgin to be appreciated at symposium

The International Fuat Sezgin Islamic Science History Symposium will be organized in Instanbul from June 13 to June 15 with the theme of "Fuat Sezgin's Scientific Heritage." Various Islamic science history experts from all over the world will discuss both their works and the contributions of Fuat Sezgin to the world of science. Sezgin was one of the most respected historians of Islamic science and the recipient of the Presidential Culture and Art Grand Prize before his death last year at the age of 94. Studying Islamic sciences and Arabic at Istanbul University, Sezgin was expelled from the university after the 1960 military coup and worked in Germany as a visiting professor at the University of Frankfurt. In 1982, Sezgin founded the Institute for the Arabic-Islamic Sciences and established a museum showcasing over 800 copies of scientific tools. A similar museum named the Museum for the History of Science and Technology in Islam was opened in Istanbul in 2008 in Gülhane Park.

Turkish banks and investors disagree on bad loan talks

Turkish lenders disagreed on almost everything with potential investors when they met for the first round of talks about unloading a pile of bad loans. Investors demanded a 30% discount on the face value of the loans and an ownership stake, but the Turkish banks refused to write-off the loans and wanted to restructure them instead. While the government plans to carve out non-performing energy and real-estate loans, attendees disagreed so that some of the participants questioned whether there would even be more talks. Bank capital ratios are being squeezed after companies requested about $28 billion of debt-restructurings after a 28% plunge in the lira against the dollar last year.

Prominent Turkish bankers, businesspeople see no macroeconomic reason for currency volatility

For Turkey's bankers and businesspeople it has been impossible to explain the high volatility in the exchange rate over the past few weeks. The fundamentals of the Turkish economy are solid and macroeconomic indicators fail to account for the recent slide in the Turkish lira, which dropped by more than 40% since the beginning of this year. These fluctuations are seen as manipulations on the Turkish lira and economy, as part of an economic war waged against Turkey by U.S. President Donald Trump. The U.S. dollar tumbled nearly 5% against the Turkish lira on Tuesday. European shares rebounded Tuesday as the Turkish currency firmed. The Central Bank introduced measures on the Turkish lira and the foreign exchange market (FX) liquidity management. The bank said it would provide all the liquidity needed by banks and closely monitor markets and prices, while raising collateral FX deposit limits for lenders' lira transactions from 7.2 billion euros ($8.2 billion) to 20 billion euros.

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