In an exclusive report dated October 16, 2023, renowned Turkish journalist Erdal Sağlam delves into the reasons behind the leak of a Bank of America report, shedding light on an unprecedented information breach. According to Sağlam, the core reason behind the sluggish inflow of foreign capital into Turkey is the result of President Erdoğan’s foreign policy choices and the nation’s persistent non-compliance with decisions handed down by the European Court of Human Rights (ECHR).
Drawing from insider information, Sağlam reveals that investors are increasingly voicing their concerns to Treasury and Finance Minister Mehmet Şimşek regarding President Erdoğan’s stances on foreign policy and judicial independence. In Sağlam’s analysis, Turkey’s non-adherence to ECHR rulings stands as one of the most formidable barriers to foreign capital entering the nation, making it a highly relevant concern for international investors. He also points out that the leaked investor notes from Bank of America were strategically disseminated.
Highlighted excerpts from Erdal Sağlam’s insightful comments on the matter include:
“Efforts to Attract Foreign Capital: Mehmet Şimşek is diligently working to lure foreign capital into Turkey. His recent meeting with investors in Morocco left an optimistic impression, with attendees expressing their support. Nevertheless, the critical issue remains the scarcity of incoming investments despite the upbeat sentiment.”
“Foreign Policy as an Impediment: Turkey’s foreign policy choices are increasingly hindering the inflow of capital. Key officials have emphasized this, and recent developments, such as the European Union’s decisions and statements from President Biden, signify a deteriorating international relationship with Turkey.”
“The Unveiling of Bank of America’s Investor Insights: The leaked reports from Bank of America’s investor meetings are eloquently conveying a message concerning President Erdoğan’s foreign policy stances. Whether this information was intentionally disclosed or not is an ongoing debate, and I’ve conducted an in-depth investigation into this matter.”
“Investors’ Concerns: From a technical perspective, they highlight that real interest rates remain elusive, interest rates are persistently climbing, reserves are at alarmingly low levels, and there’s a continuing risk tied to the current account deficit. Additionally, they argue that exchange rates are still undervalued, and foreign investors are demanding more favorable exchange rates.”
“The Trust Factor: Beyond these factors, one of the most significant concerns is a lack of trust in President Erdoğan’s commitment to these policies. Investors appear to be taking a ‘wait and see’ approach, particularly in anticipation of the upcoming local elections. They are closely watching to discern if orthodox policies will be maintained.”
“Bank of America’s Opaque Demands: The investor notes from Bank of America imply additional requests that are not explicitly articulated. These points were conveyed to Mehmet Şimşek, but there is a prevailing sense that this message may not be relayed to President Erdoğan. Consequently, when Bank of America’s investor notes leaked, the President became privy to their contents.”
“The Leak’s Motivation: The intentional leak hypothesis gains credibility when considering the content of the report. It highlights that the non-compliance with ECHR rulings poses a hurdle for capital inflow and identifies European sanctions connected to Mediterranean oil exploration as further obstacles. My sources indicate a growing sense of investor dissatisfaction, suggesting that this sentiment has been intensifying over recent times.”
