Turkey's external gaps growing rapidly

Turkey?s foreign liabilities have jumped by $41 billion while the rise in its foreign assets remained at $4 billion, revealing the vulnerabilities of the country The ?equilibrium? situation in countries? relations with global economy has vital significance. How much a country can cover its foreign debts to global markets and other liabilities with its assets it has contributed to the global economy, in other words, with its investments in the external world and with its domestic gold and foreign currency reserves? If there is a gap in its liabilities versus assets, what is its dimension and where does this stand at its national income?  

This indicator and similar ones, reveal the fragility coefficient of countries. The method to measure this has been determined by the IMF and it collects information from member countries with a handbook.

How much are your assets, how much are your liabilities and thus what is the dimension of your gap or surplus?

In Turkey, the Central Bank produces the International Investment Position (IIP), which is the stock value at a certain date of external financial receivables and financial assets versus external financial liabilities. This statistical data is updated every month.

In IIP, the difference between the total financial assets and total financial liabilities, is named the net international investment position. In other words, the net international investment position is the net of Turkey?s receivables from other countries and Turkey?s debts to other countries. The IIP can be negative or positive.

For Turkey and similar countries, the IIP is generally negative. External assets are not enough to meet external liabilities. This situation changes from year to year....