US firm to link Turkey to $2 trillion funding network

U.S.-based multinational alternative investment company National Standard Finance (NSF) will connect Turkey to a $2 trillion funding network that is set to bring in more foreign direct investment and help boost the economy, CEO Russell A. Duke has told Anadolu Agency.

The NSF has links to large foreign institutional and sovereign investors and has engineered an initiative for Turkey to increase foreign investment and trade, Duke said.

Turkey will first receive a four-year $20 billion investment via the soon-to-be-established Turkish Gulf Fund, which will act as the managing entity between investors, institutions and governments of the Gulf Cooperation Council (GCC) and their Turkish counterparts to develop and invest in projects in Turkey, he said.
“We feel confident that the Republic of Turkey has the opportunity to be a diamond in the rough to invest in long term among emerging economies while also offering more attractive yields to investors than the majority of other global market in the current economic environment,” Duke said.

The fund will benefit Turkey in several ways, he said.

“Turkey’s big problem is that they don’t have liquidity. If you put this kind of liquidity into the market, these will make big movements in the monetary system,” Duke said.

Second, the initiative and the fund will make Western institutional and financial markets, as well as companies, more comfortable with the idea of investing in Turkey, he said, adding that it would also help the Turkish Lira appreciate.

“Once the lira gets stronger, that’s going to be an indication that the economy will be more stable,” Duke said.

In 2015, Turkey’s trade deficit was $63 billion. The investment may also help close the gap in Turkey’s trade imbalance, Duke noted.

The lira fell on Jan. 11 to its all-time lowest against major currencies, as the value of the U.S. dollar jumped to 3.94 against the lira. Duke said he believed this trend would be reversed in three to six months.

“It will be in a more manageable situation, back down to 3.4 range, and then there is a possibility to trend that down further over the next 18 months,” he said.

The initiative and the Turkish Gulf Fund will also aid Turkey by strengthening its relations with GCC countries and the U.S.

“The long term political and economic stability of Turkey is also very important for the stability of the region as well and this is of significant value to us,” he added.

Trump effect

Duke said he believed that under the newly elected Donald Trump administration, strategic relations between the U.S. and Turkey would improve in the short and long term.

“A stronger relationship between the two countries will help to greatly mitigate the political risk of doing business and making foreign direct investment in Turkey by institutional investors,” he added.

Foreign capital will be aimed toward infrastructure projects, as well as real estate, industrial, and energy-related areas in Turkey.

Duke said the NSF had already begun evaluating projects that have the potential to qualify and be structured for institutional capital from international financial markets and that the Turkish Gulf Fund would act as the managing entity for each project.

“The timing for that is already underway to establish that … when the public money starts to actually be deployed, the deployment is going to depend on Turkey’s side” regarding how ready these projects are for investment.