CARLOS E. PIÑERÚACOUNTRY SECTOR COORDINATOR, TURKEY

THE WORLD BANK

MARCH 12, 2012, MADRID

“Turkey: The Role of Small and Medium Enterprises as the Engine of Economic

and Employment Growth”

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Outline of The Presentation 2

A Success Story…Is It?Challenges Remain…Where?

Lessons…for Whom?

A Success Story…..3

“…a good economic performance and lack of economic problems which are enjoyed by Turkey at a time when many European countries suffer many economic problems and crises display Turkey as a shining star here. I’m greatly proud of this situation.”

From High Inflation to Stability

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From Stability to Growth5

Fiscal Consolidation (I) 6

Fiscal Consolidation (II) 7

Open the Economy 8

Willingness to Privatize 9

You Get What You Need 10

Banking Sector Also Key 11

Key Messages:12

Expansionary Austerity Works.Structural Change Needed for Efficiency and Financing.

Banking Sector Restructuring a Must!

Sometimes It Pays To Be Lucky Too…

Is Stability Sufficient?13

How Competitive is Turkey?14

What are the Challenges?15

Hiring People a Critical One…

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Redundancy Costs in Selected Countries(weeks of salary, 2009)

Redundancy Costs in Selected Countries(weeks of salary, 2009)

What is an Investment Climate Assessment?

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What Ails Companies (I)18

What Ails Companies (II)19

Single most severe investment climate obstacles, by firm size

Source: Investment Climate Assessment, World Bank

SMEs at the Heart of the Economy…..

Source: Turkish Statistical InstituteMicro:1-9 Small: 10-49 Medium: 50-249 Large: >249

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Turkish SMEs are Growing Slower…

Growth Rate of Turkish SMEs Relative to Other Countries % (2004-2007)

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Source: Turkish Investment Climate Assessment, World Bank

Time “Tax” a Critical Issue22

Proportion of Management Time Spent on Government BureaucracyProportion of Management Time Spent on Government Bureaucracy

What is Turkey Doing?23

A new Commercial Code.TransparencyAccountability

The Importance of Financial Reporting

Accounting and

Auditing

Development of Capital Markets

Job Creation

Financial Stability

Private Sector Growth

Financial Sector Development

Improved Access to Credit

Financial Information

ECONOMIC GROWTH

What Should Turkey Be Doing?25

Regulatory Reform.Labor Reform.Education.Skills.

Are There Lessons?26

Expansionary Austerity?

Is Stability Enough?

Is It money or Ideas?

Government’s Role?27

Thank YouTeşekkür Ederim

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