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Azerbaijan's investments in Turkey to double, says ambassador
Azerbaijani investments in Turkey, currently standing at $9bn, are expected to reach up to $20bn, Turkish ambassador to Azerbaijan Erkan Ozoral told Azernews in an interview published on April 28.
Turkey and Azerbaijan are close commercial and diplomatic partners. So much so that diplomats from the two countries often use the expression "one nation, two countries" to describe their relationship. Much of the Azerbaijani investment in Turkey is driven by state oil company Socar, which is building a refinery and huge petrochemical production complex on Turkey's Aegean coast and a network of interconnected gas pipelines known as the Southern Gas Corridor. Meanwhile, Azerbaijan is an important destination country for Turkish consumer goods.
Some 2,600 Turkish companies operate in Azerbaijan's telecommunications, banking, insurance, consumer goods and agribusiness sectors. At $7.9bn, Turkish investment in Azerbaijan is nevertheless lower than Azerbaijani investment in Turkey. The trade turnover between the two countries amounted to $1.67bn in January-September 2016.
According to Ozoral, Ankara and Baku are seeking to boost trade to up to $15bn per year. Once Azerbaijan increases its gas exports to Turkey from the Shah Deniz II offshore gas field in 2019, trade will undoubtedly increase. Azerbaijan already exports some 6bn cubic metres of gas to Ankara per year; the figure is to double starting in 2019.
Moody’s expects Russia, Turkey debt ratios to rise over next two years
Public debt in both Russia and Turkey is set to rise over the next two years, although the increases will be modest as a share of GDP, Moody’s Investors Service said in report published on April 27, Reuters reported.
However, the rating company expects both countries' debt ratios to increase gradually in the next two years. In February, Moody’s upgraded Russia’s outlook to stable, and in March it lowered Turkey’s rating outlook to
negative from positive.
“Russia and Turkey face common growth challenges, despite differing exposure to the commodity cycle... Credit ratings for Russia and Turkey reflect a deterioration in previously supportive credit fundamentals, including their growth potential,” Moody’s argued, according to the news service.
The rating company expects real GDP growth of about 3% in Turkey over the next four years, twice that of Russia's 1.5%, underpinned by Turkey's more favourable demographics.
In April, The International Monetary Fund revised Russia’s GDP growth forecast to 1.4% for 2017, up from the 1.1% and 1.2% expected previously while it lowered its GDP estimate for Turkey to 2.5%.
Moody’s warned earlier this month that the narrow Yes vote in the controversial April 16 referendum weighs on Turkey’s creditworthiness.
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