Agency will be formed with partnership from BRICS countries who often face sanctions from West, banker says
A local credit rating agency will direct foreign investments to Turkey in the coming years, chairman of the Participation Banks Association of Turkey said.
"An independent rating agency which has high acceptability and understands the market requirement will strengthen Turkey," Metin Ozdemir told Anadolu Agency.
The agency has been on the cards for sometime.
The Banking Regulatory and Supervision Agency (BDDK) prepared regulations for the agency, which will be established with the partnership of BRICS -- Brazil, Russia, India, China and South Africa -- countries.
"We can achieve this target by following principles, gaining reputation and establishing an independent supervision and administration structure," he added.
He noted that establishing the agency with the partnership of BRICS countries, which have one-fifth of the world economy, will go a long way.
"We expect objective and economy-based remarks from international rating agencies -- Moody's, StandardPoor's, Fitch -- instead of political views," he said.
Otherwise, he added, their evaluation would lose credibility.
International agencies' ratings -- based on the economy, politics and social risks -- help investors choose a country and determine borrowing costs, he noted.
Ozdemir said international agencies' subjective and non-transparent evaluation decreases confidence.
During the last year, western credit rating agencies dropped Turkey's credit ratings several times arbitrarily, he recalled.
He added: "Establishing a new credit rating agency is also in the best interests of BRICS countries which often face western-based sanctions and financial stresses."
The national credit rating agency's priority will be providing service to all the countries, he said.
Ozdemir stressed Turkey needs to grow over 8 percent annually to reach its 2023 targets -- $2 trillion GDP and $500 billion exports.
"To make Istanbul one of the most important financial centers in the world, we continue to work for Istanbul International Financial Center Project," he said.
In its medium-term program published last October, Turkey aimed to establish a local credit rating agency.
With Turkey's record growth rate -- 7.4 percent both in 2017 and the first quarter of 2018 -- the rating agencies' negative decisions on Turkey's economy were slammed as biased by Turkish leaders.
Nihat Zeybekci, then-economy minister, said: "We do not find rating agencies' assessments reasonable, they are speculative and manipulative."
Mehmet Ali Akben, head of the BDDK, said Turkey has made regulations to allow the formation of an independent and local credit rating agency sometime in 2018.
"The new measure provides regulations for licensing credit rating agencies and their activities," he stressed.
"Some regional and international rating agencies have requested information, and want to participate in the local agency," he added.
