Turkey Plans to Ramp Up Borrowing in 2020 as Budget Woes Mount

(Bloomberg) -- Turkey plans to raise 357.2 billion liras ($62.5 billion) of debt in 2020, a 50% increase compared to projections for this year, according to the Treasury’s borrowing strategy published Thursday.

The more aggressive borrowing target comes after an economic slowdown hit tax revenue in 2019, while a heavy debt repayment schedule next year threatens to strain government finances.

Key Insights

• Turkey plans to borrow 299.6 billion liras from the domestic market and redeem 287 billion liras, which will take the so-called debt rollover ratio to 104%, according to Bloomberg calculations. That’s down from an expected 121% this year.
• The Treasury plans to borrow $9.6 billion in international markets in 2019, up from this year’s target of $8 billion
• The government will also sell a lira-denominated sukuk in February, April, September and November

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• For more on Turkish government’s economic targets, click here.
• This year, the Treasury planned to raise less cash through local-currency debt sales than it redeemed for the first time since 2016, but those plans fell through amid mounting fiscal pressures

To contact the reporter on this story: Cagan Koc in Istanbul at ckoc2@bloomberg.net

To contact the editors responsible for this story: Onur Ant at oant@bloomberg.net, ;Lin Noueihed at lnoueihed@bloomberg.net, Constantine Courcoulas, Paul Abelsky

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