Risk Analysis of Emerging Countries Case Study: Turkey

Details

Supervisors

Defraigne, Jean-Christophe

Faculty

Louvain School of Management

Degree label

Master [60] en sciences de gestion (horaire décalé)

Abstract

The development risks for Turkey are examined in this study through the lenses of economy, socio-political developments, relations with alliances, and information domain. The economic domain carries major risks for Turkey. GDP growth, inflation and unemployment are all worsening. The trends in external debt and current balance shortage, exchange ratio problems, economic mismanagement, and politicization of central bank can lead to major liquidity and debt problems. Energy dependency -especially over reliance to Russian energy- is likely to be a major issue in light of Ukraine crisis and increasing cost of energy. On the socio-political domain, polarization and economic inequalities are eroding trust, and even worse, leaders of main groups view it in their benefit to fuel polarization for the rally under the flag effect. For alliances, Turkey’s balancing act for Russia and NATO is not sustainable and likely to come to an end. Turkey-EU relations are to be expected to continue on a more transactional and case-by-case manner, which works well for both sides. On the education domain, Turkey is facing mismanagement due to politically motivated moves on the education system, which will hurt Turkey’s development in the decades to come. A combination of the issues above, exacerbated by global shocks can result in a crippling effect, especially considering the social and political unity required to overcome these problems may themselves be compromised.